Driving Auto Lending Among Baby Boomers

For many Baby Boomers, seeking new thrills as they enter retirement is a top priority, at least that’s what a new report finds from the Transportation Research Institute at the University of Michigan. In the study, adults ages 55 to 64 were more likely to purchase a new car than other age groups, which puts some weight behind the news reported last spring that Boomers surpassed Generation Y in car buying. The findings showcase the importance of marketing to this powerful age group for auto lenders. Michael Sivack, University of Michigan professor and author of the study, writes “marketing efforts that focus on drivers 55 to 64 years old should have the highest probability of success per driver.”

In other words, Baby Boomers just might be a credit union’s best member–at least when it comes to auto loans. Many members are turning to credit unions for lower rates and high customer service in auto loans. In a recent study done from Jeffry Martin, president of auto buying CUSO (Credit Union Service Organization), 42 percent of his company’s sales were made by the Baby Boomers while the Millennials held a scant ten percent of the sales. Credit unions need to strike a balance between boomers and Millennials and structure their loan programs, service capabilities, and marketing to appeal to both groups. Understanding that the Boomers currently have greater purchase power and higher credit quality is important. These members are better established and have had time to save more money than younger generations.

Photo Source: Credit Union Times

Photo Source: Credit Union Times

Credit unions can make the most of this market opportunity by creating winning auto loan packages for the Baby Boomer demographic. Robert C. Davis and Associates focuses on making a positive impact on credit union clients and has succeeded, most recently with the Police and Fire Federal Credit Union. Currently, credit unions enjoy 40 percent offer acceptance rate. If your credit union needs to improve the amount of offers coming in, Bob Davis has an exclusive approach proven to reach members, called the Quality Conversation. In training for this technique member service representatives (MSRs) learn how to ask members about their financial needs in a friendly, non-threatening manner. MSRs also learn how to build rapport and trust and increase the level of satisfaction a member takes away from the experience. Showing genuine interest in a member’s needs and asking key questions to evoke a response will help speed auto loan offers into 2014.

With more than 30 years of experience in management and call center training, Bob Davis and Associates provide customized training packages that can teach MSRs how to reach out to critical demographics and convert calls into offers for auto loans. To learn more about how your credit union can make the most of the market advantage in auto loans, visit the Credit Unions industry page.