Thoughts on Millennials from a Millennial
By Christopher Gerber, Associate Digital Editor
August 30, 2012
Filed under Chris Gerber
The dream of a house with a big lawn and three-car garage with a sports car or truck to fill it is on its way out with Millennials, who don’t have the same desires and spending habits as their parents and grandparents.
At least, that’s according to The Atlantic editors Derek Thompson and Jordan Weissmann in an article from the magazine’s September issue titled “The Cheapest Generation: Why Millennials aren’t buying cars or houses, and what that means for the economy.”
Thompson and Weissmann write that two important economic stimulators, the housing and transportation markets, have propelled the economy out of recessions since World War II, and since the 1980s the young adult generation has contributed by buying new cars and houses. But Gen-Y? Not interested.
Ford learned that when it gave away 100 cars to influential Gen-Y bloggers. Despite broadly shared love for the car, and after a blip where car sales were way up, young buyers stopped caring and sales dropped 38 percent. The editors claim that this is due to shifts in priorities and preferences from houses and cars to technology and gadgets. But, as seen in the testimonials many young people sent in response to The Atlantic article, it may not be that Millennials are finding new things to buy but are instead afraid of what could happen if they take on debt.
In the past 14 years, three bubbles have burst before our eyes: Dot coms, financial and housing. I think this has made Millennials, my generation, a little gun-shy about pulling the trigger on any big loans. Kids have seen what happened when their parents took on massive debt to purchase the homes of their dreams — on the assumption that they would not only retain their value but become an investment to be cashed in upon retirement. The market shift in the past few years has caused everyone, especially young Americans, to rethink that proposition. And today, many see their own friends who graduated years ago still working the job they had in college and wonder about their own job security in the next six months.
If the entire generation of Millenials, approximately 80 million Americans or one-third of the U.S. population, has or will probably decide to abandon the purchases that sustain the economy, how can we convince them to purchase a boat? What will it take to change their mind about debt as a death sentence?
For adults who graduated college in the 2000s, many are already managing debt levels on par with a mortgage thanks to student loans. Essentially, my generation is being told to incur a mortgage and then graduate and start looking for another. After years of facing worries about how to get funding to go to college, and then worries about how to pay it back, Millennials are less willing to jump in and experience that all over again, choosing instead to rent, travel and make smaller purchases like tablets, smartphones and computers.
It doesn’t mean a death sentence for boating, but it’s definitely a concern. Ford battled this by being the largest supplier to car rental service Zip Car. Noticing that for Gen-Y it’s more important to have access to things than to own them, Ford supplied the cars on the assumption that if they’re driving a Ford, they’re more likely to buy one eventually.
One way boating can combat the decline in an ownership society is by increasing access, mainly through boat clubs. I know a lot of Millennials who love the idea of spending a day out on the water, being out on the lake in the sun with friends and maybe doing some wake boarding. But most are living in apartments in the city and driving older cars, with no place to store a boat or even a vehicle that could haul it around. They love boating, but ownership just doesn’t fit into their lifestyle. It requires bigger changes and commitments to their lives than they can convince themselves to take, at least in the short term.
For the past several decades, baby boomers have been driving the economy with a “sell it to me and I’ll buy it” attitude that fueled the purchase of houses and then bought stuff to fill those houses. As Millennials age from the “up and coming” generation to the “here and now” generation, a lot of industries, particularly ours, will have to figure out how to get them access to the boats and activities they want before it’s too late to kindle their interest and convince them that one day, they’ll want drive off the lot with it.