How Ford Is Addressing One of Its Biggest Problems


Sheryl Connelly is the head of Ford's Global Trends and Futuring Division, where she separates trend from fad and helps the auto maker determine what global changes will influence the market in years to come.

A full transcript follows the video.

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Brendan Byrnes: One of the things, with the Information Age, a lot of millennials, the younger buyers, Gen-Y, they say they'd rather own maybe a smartphone. There are less drivers. Less people are getting their licenses among the millennials. More people are moving into cities.

Is this a trend that you're watching carefully, and what kind of things can you recommend? On the product side, they decide what goes into the cars, but what are you seeing as far as people moving away from cars, especially young people, and how that affects Ford?

Sheryl Connelly: We've been talking about this inside of Ford for a long time. The Department of Transportation issued a report a few years ago that basically said 70% of all 16 year olds do not have their license. That's a challenge. That's going to be a challenge for a car manufacturer that wants them to have their license, and to drive.

We explored it. There's no clear-cut answer as to why this is happening, so I'll run you through some of our theories on it, one of which is that it's harder to get your license today than it's ever been before. The states have a graduated system, and that's changing, but that can't explain all of it, because the numbers are down for 17-18 year olds and 19 year olds.

We think economics play a role. When I got my driver's license, it was free. It was offered through the local high school, but today it can cost anywhere from $200-800 to get private driving lessons. Then to add a teenage driver, for a family to take on that cost, is also equally expensive.

That's part of it, but I don't think that's the whole story. You've already alluded to what I think is probably the biggest driver, is this ubiquitous connection of technology.

We have devices that make us feel like we are with people, even though we are physically apart. That virtual connection means that we don't always have to be together. We have text messaging, Skype, Twitter; things that make us feel like we're in company with our friends.

We also know that what the car means to people today is evolving. If you were a baby boomer, when you came of age a car was a gateway purchase.

Brendan: It was freedom.

Sheryl: Yeah. It was freedom, it was independence. It meant that you had arrived. You were officially an adult. But if you ask my daughters, they would say the gateway purchase into adulthood is a cell phone, and that is freedom and independence.

That's a new context that we're trying to bring into it. The way that Ford is dealing with that is that we're making sure that our cars are much more than just transportation. For those who want it to be a status symbol, and are drawn to the engineering and the exquisite design, we'll still deliver that.

But for those customers that aren't in tune with that, we need to make sure that we're delivering it as a lifestyle enabler. We do that through bringing in platforms like SYNC, which let you pair any Bluetooth device with it, so you engage on your cell phone or your MP3 player through voice activation and hands free.

We also are engaging with more communications with millennials. Marketing used to be a monologue, and now it's a dialogue. It's a two-way discussion, so we're leveraging that.

A couple of years ago when we were bringing the Ford Fiesta over from Europe and we were going to launch it here in the U.S., we took people that were very influential in the social media space. I think they were 100 Fiesta agents, and we let them drive a Fiesta for six months.

All that we asked was that they report, share the word, document their experience; good, bad, or indifferent. Just tell us what you think.

That was really powerful because young people, as you said, are so tech-savvy, they're marketing-weary. They've been inundated with messages their whole life, so that word of mouth, that authentic voice of someone who's interacted with the product, is a way that we reach young people that we haven't done in the past.

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Brendan Byrnes owns shares of Ford. The Motley Fool recommends Ford. The Motley Fool owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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