Chasing a demographic

"Chariotoflove" (chariotoflove) 08/04/2016 at 13:02 • Filed to: cars for geezers

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Stories like the one on the !!!error: Indecipherable SUB-paragraph formatting!!! I just read on the FP always make me shake my head in wonder. Companies talk about wanting to get a younger average buyer. For instance, the average age of a Corvette buyer is in the upper 50s, and they want it lower. Cadillac, and every other maker of expensive cars says the same thing.

So GM, you’re chasing that lucrative market of rich, childless 30 somethings that have cash to burn on a two-seat, $60K+ sports car? All 14 of them? How is that niche market the answer to profitability? The rest of the world has to save up for a few decades and wait until the kids are out of the house with college paid off before they can afford to indulge. And what do you care how old they are, as long as they buy? These cars are supposed to be aspirational. That means you have to work toward them.

Reading the comments in that story, I have to give credit to LongbowMkII, who said essentially the same thing, making me feel I’m not alone in my disbelief.

Smallbear wants a modern Syclone, local Maple Leafs spammer > Chariotoflove 08/04/2016 at 13:11

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Chevy needs more awesome geezer cars so the rest of us can buy them used.

Chariotoflove > Smallbear wants a modern Syclone, local Maple Leafs spammer 08/04/2016 at 13:16

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Exactly! And the older the average buyer, the sooner they shuffle off and leave us their cool cars to buy at estate sale prices, right?

SidewaysOnDirt still misses Bowie > Chariotoflove 08/04/2016 at 13:17

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GM used to do it right.

jariten1781 > Chariotoflove 08/04/2016 at 13:18

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I don’t think the concern is the age demographic, per se, it’s that the demographic gets older every generation of vehicle. If they could consistently sell to the 55-60 crowd they’d be ok...instead (guessing at numbers) one generation sold to the 45-50 group, next to 50-55, next to 55-60. That’s unsustainable since we have a tendency to cease living at some point or another.

Chariotoflove > SidewaysOnDirt still misses Bowie 08/04/2016 at 13:20

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My pants just got really tight.

DrScientist > Chariotoflove 08/04/2016 at 13:21

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halo effect?

while old geezers buy corvettes, an unattractive target ends up buying malibus and equinoxes or whatever.

when that 30something childless rich guy buys a carrera gts, an attractive market ends up buying macans and panameras.

attractive/unattractive here means from a marketing perspective, ie, are we going to be able to sell them additional options and gear, are they going to become brand loyal.

If gm actually wants to do this, they need to make the mid engine corvette like a GT-R or even one-up the GT-R with its video game inspired functions. hell, make it so far from your grandfather’s concept of an automobile, that no one >40 years old will even know how to operate it.

SidewaysOnDirt still misses Bowie > Chariotoflove 08/04/2016 at 13:22

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That’s what happens when you look at a car from a company that builds excitement.

Chariotoflove > jariten1781 08/04/2016 at 13:28

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I guess that makes sense, but it goes toward the larger problem of whether you area making good cars if you can’t keep an audience from shrinking. It’s not the language I’m hearing from the car makers when I read. They seem to be wanting younger buyers so they can keep them as repeat buyers over their lives, only that’s not a reasonable expectation if the cars start out too expensive to buy until you’re older.

Chariotoflove > DrScientist 08/04/2016 at 13:34

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Sure, you make a good point, but that market is so small that GM might as well hire a bunch guys to drive Corvettes around their favorite markets as PR and accomplish the same goal.

I worry that if Chevy goes mid-engined that, rather than reposition the Corvette’s identity to younger generations, they will lose what separates the Corvette and makes it special.

Chariotoflove > SidewaysOnDirt still misses Bowie 08/04/2016 at 13:36

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The Ghost of Oppo > Chariotoflove 08/04/2016 at 13:46

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How does targeting a slightly younger demographic for a car that is out of the price range of most people, make it any less inspirational?

And you know who they mean when they say younger people? Pro athletes, movie stars, and musicians. People who are, for lack of a better term, trend setters.

samssun > Chariotoflove 08/04/2016 at 13:49

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They want to start with a younger demographic so they keep buying cars for decades. I’ve been showing my dad the CTS and ATS for years now and he just shrugs because to him a Cadillac will always be something his grandfather might drive while wearing white pants in Florida.

Yes there’s a much smaller market of 30-somethings who can pay 50k for a CTS, so they try to get them into a 35k ATS instead. For Chevy the path might be something like buying a 4-banger Camaro, then eventually moving up to a Corvette, but a viable SS option would be great for guys who need more doors for family.

Chariotoflove > The Ghost of Oppo 08/04/2016 at 14:03

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I think that targeting a market that you expect to be able to buy your car when they get old enough to afford it is fine as part of a long-term business plan. I think targeting a mass-production car to get a group of younger people, of whom smaller numbers can buy your car, means you get a smaller market and so a smaller potential pool of profits.

The celebrity trend setters are great for marketing. There are not enough of them to sustain profitability for a car like the Corvette.

Kent > Chariotoflove 08/04/2016 at 14:04

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I agree with you. As long as Corvettes are selling well (which they are) then why should it matter to GM how old the average buyer of Corvettes are? Business is business. The only reason the Corvette exists is to make money, which is exactly what it’s doing.

Chariotoflove > samssun 08/04/2016 at 14:09

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Yeah, the pipeline thing was how GM thrived for generations. It makes sense to me to say, “we want to position models to get buyers into our brand earlier in their careers.” I don’t get as much the thinking that “we need to get the average age of buyer for this model lower” when it’s priced out of the reach of the lower age group. That’s kind of an uphill battle to profitability.

The Ghost of Oppo > Chariotoflove 08/04/2016 at 14:48

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Maintaining long term sustainability and profits is about changing strategies and attracting new buyers. What is the saying? Something like, “what are the 7 most dangerous words in business? We have always done it that way ”. The demographic isn’t staying the same, it is getting older, THAT is a problem. You can’t just sit around hoping that there will always be this one niche group of people with enough money to buy your product, you look to expand to new markets(even if they are smaller) while retaining the traditional buyers.

It isn’t like changing the Vette to mid-engined will kill off all of the 55+ buyers. A universal theme of older people buying sports cars is to feel young again, having actual young people driving them can’t hurt.

The Ghost of Oppo > Chariotoflove 08/04/2016 at 15:05

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Also, if you want to talk long term sustainability, look at the Vette’s sales numbers. Sales of the C7 spiked in the last half of 2013 and all of 2014. Then in 15 fell 5% despite the release of the Z06 and it being the highest total sales year in US history. Now through 2016 sales are down 20%. That is not the kind of curve you want your product lifecycle to follow, especially a one that traditionally has an 8-10 year run. You need to find buyers for those post launch years when the hardcore enthusiasts and the “been saving for years” aspirational buyers are not coming into the show rooms.

samssun > Chariotoflove 08/04/2016 at 20:26

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I think it’s a combination of perception/marketing (ie my Dad will never consider a Cadillac because it’s an old man’s car) and trying to extend further downmarket to start that trade-up cycle.