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Boomers Aren't Dead Yet: Insights Report October 2013


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Do you realize Brad Pitt and Madonna are Baby Boomers? Yep. This report will make you look at Boomers differently. See what your brand can do to reach a generation that is 80 million strong!

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Boomers Aren't Dead Yet: Insights Report October 2013

  1. 1. 2 don’t foRget the BooMeRs TO STAY FRESH AND RELEVANT, MARKETERS OFTEN SEEK THE NEXT BIGGEST CONSUMER TARGET... ...CULTIVATING RELATIONSHIPS NOW THAT DRIVE TOWARD LONG-TERM BRAND LOYALTY. The most recent generation to see this attention — and one worthy of focus with their significant purchasing power and social influence — is the Millennial segment (age 18-34). We wrote about them in our last paper, and agree that they are a massive generation that is set to change the face of marketing as we know it. Yet, we CAN’T FORGET THE BABY BOOMERS. These consumers (born 1946-1964) are the parents of “generational influence” and proved to be one of the most marketingfriendly consumer groups in history. THEIR SIZE AND PURCHASING POWER CARVED THE PATH UPON WHICH MILLENNIALS NOW WALK, and taught marketers a thing or two about the value of paying attention to the wants and needs of the people buying their products and services. THIS GENERATION IS ALIVE AND WELL, with still critically important “chops” in their share of purchasing power — THE “SILVER TSUNAMI” that, while it may be slightly different in the types of products and services in which they are interested, is still impactful and worthy of continued attention. In general, there are some misperceptions that exist about Baby Boomers, as well as some still-strong marketing opportunities that speak to the VALUE THIS GENERATION STILL HOLDS.
  2. 2. 3 BooMeRs hAven’t stopped BooMIng MYth: Boomers have already lost significant size and spending power and share of the market. ReAlItY: Boomers number roughly 80 million and exert considerable financial control of the marketplace (and will continue to do so for years to come). 50 50 BY 2017, % BOOMERS ARE SET TO 70 34 15 CURRENTLY, BOOMERS CONTROL % ADULT POPULATION WILL BE AGED WHILE THE 18-49 POPULATION IS EXPECTED TO GROW 12 % BY 2030, the 50+ OF ALL INCOME. U.S. DISPOSABLE INHERIT O F T H E U. S. $ + POPULATION WILL GROW % TRILLION IN THE NEXT 20 YEARS. Source: Nielsen and BoomAgers Report, 2012.
  3. 3. 4 theY ARen’t who You thInK theY ARe While much research has been conducted over the years to understand and predict Boomer behavior, they have proven to be highly adaptable to change. Much of what you might have thought about Boomers may be inaccurate or dated. MYth MAnY BelIeve BooMeRs ARe… ReAlItY But In ReAlItY, BooMeRs ARe… …following traditional pathways to retirement and looking to settle down. …bridging the gap between their careers and retirement with non-traditional activities. …“set in their ways,” less active and less open to change. …seeking new experiences and building new connections that enrich their lives. …stingy with their money and losing significance as consumers. …influential consumers willing to spend their hard-earned money on things that matter. …increasingly out-of-date and out-of-touch with modern society. …young-spirited, fighting to stay current and relevant.
  4. 4. 5 new pAthwAY to RetIReMent tRAdItIonAl lIfe stAges educAtIon Previous generations have followed a sequential pathway through three distinct life stages: education, then work, then retirement. woRK BooMeR lIfe stAges RetIReMent Boomers have rewritten the traditional path and blurred the lines between life stages. In effect, they are exercising their freedom of choice, while still remaining committed to their goals. educAtIon • “If I stop learning, I stop living.” Many Boomers seek opportunities for continued learning and knowledge, not only to sharpen skills for their current job, but to set the stage for personal enrichment and pleasure. • As of 2012, 45% of adults aged 45-64 participated in adult education. MetLife Mature Market White Paper, 2012 woRK • Financial strains resulting from the Great Recession, their children’s education costs and elderly parent caregiving, many Boomers are postponing retirement. • The number of workers over 65 is expected to grow by 80% by 2016. U.S. Bureau of Labor Statistics RetIReMent • Boomers are dipping in and out of retirement, mixing later life leisure with ongoing work life to help themselves financially and stay active and relevant. • 80% say they will continue working, even upon retirement. Del Webb Survey, 2013
  5. 5. 6 gRowIng oldeR Boomers are changing the face of aging. It is not about gettIng older, but finding ways to gRow older. • As the healthiest, happiest, most educated, and most active generation ever to come into retirement, Boomers are not ready to settle down as they age. 49% • Instead, having come of age during a period of activism and social reform, they aren’t just open to change, they are accustomed to it, often seeking ways to elevate their experiences. • Rather than the traditional move to golf course communities upon retirement, 38% 28% 24% Boomers are looking for living arrangements that foster active lifestyles. 21% + chAngIng geogRAphY: Relocating to cities with vibrant culture, outdoor activities and social happenings. 14% 1996 2011 + lIvIng Young: Looking for exciting and healthy activities that promote physical/mental well-being. NEW ENTREPRENEURS BY AGE + cultIvAtIng new: Building new relationships, experiences and connections to expand and grow in all areas of their life. KAUFFMAN INDEX OF ENTREPRENEURIAL ACTIVITY, 2012 Activities that enhance health and well-being. 59% Travel. 51% Age 55-64 • Although many continue to work even after retirement, not all are Nearing retirement, Boomers plan to focus on: 62% Age 45-54 Reinvention and self-discovery. 51% Spending time with family. DEL WEBB SURVEY 2013; TRILOGY LIFESCAPE SURVEY doing so out of necessity. + In 2011, Boomers produced the most new entrepreneurs of any generation, demonstrating their need for enrichment and continued learning. + 51% plan to avoid boredom and maintain a sense of purpose by working. 46% say they “like to work.” Del Webb Survey 2013
  6. 6. 7 old MeAns gold While Boomers face financial constraints, their ability and willingness to spend money has not been reduced, but is simply more pragmatic and discerning toward what matters most. pRActIcAl decIsIons dRIve choIce of RetAIleRs foR BooMeRs - 60% MoRe thAn MIllennIAls. MILLENNIALS BOOMERS • Unlike their parents, BooMeRs gRew up In A post-wAR peRIod of optIMIsM And 50% Affluence, resulting in deep-seated “consumerist” values that persist today. 80% • However, having faced a variety of fortunes and misfortunes in their lives, they demonstrate pRActIcAlItY and sAvvIness in their decision-making. Source: The Brodeur Partners’ Retail Relevance 2012 Study. • While MARKeteRs ARe depRIoRItIzIng the potentIAl of thIs geneRAtIon As “consuMeRs,” the reality is that they must keep fighting for their attention. • Contrary to popular belief, Boomers are no MoRe oR less BRAnd loYAl oR pRIceconscIous thAn otheR geneRAtIons. • However, to cultivate a relationship with them, Boomers expect to Be RewARded foR theIR coMMItMent to brands. BOOMERS REPRESENT… 62 80 % AUTO SALES % LUXURY TRAVEL J.D. POWER AND ASSOCIATES’ AUTO OFFLINE MEDIA REPORT, WINTER 2012 NIELSEN AND BOOMAGERS REPORT, 2012. BOOMERS PURCHASE CLOSE TO 50 % of All cpg pRoducts, But less thAn 5 of Ad dollARs ARe tARgeted to theM. % Source: Nielsen and BoomAgers Report, 2012. • As their children finally move out of the house and they move into later life, BooMeRs ARe looKIng foRwARd to spendIng theIR hARd-eARned MoneY on theMselves. • Over 2/3 plan to spend more time on their hobbies post-retirement. • In particular, they are attracted by activities and brands that are updated versions of pRoducts theY gRew up wIth — enabling them to tap into the happy emotional times of their youth.
  7. 7. 8 eldeRlY, schMeldeRlY… The media is sending mixed signals about the Boomer generation — presented as either incapable and out-of-date or shown in unrealistic scenarios that are not true to life. Boomers are fighting to dispel these portrayals with their pocketbooks and the brands they choose. • Beginning in the 1960s, marketers began targeting Boomers. • With attention now being shifted to younger generations, BooMeRs + Similar to Millennials, Boomers were targeted because ARe often dIsAppoInted BY Ads they deem patronizing and of their large size and influence on culture (sex, drugs, and rock & roll). + Brands like Pepsi and Levi’s aligned themselves with America’s free-spirited youth and this “new generation.” that depict them as “older than they feel.” • Early Boomers (ages 58-67) will not even think of themselves as “old” until they are nearly age 80. MetLife study of Oldest Boomers, 2013 • BooMeRs wAnt to Be ReAlIstIcAllY RepResented. + “Brad Pitt and Madonna are my age. Does the world look at them as being old?” + 55% of Boomers agree that if they feel advertising is relevant to them and their lifestyles, it has significant impact on their purchasing decisions. Source: © 1964, Pepsi-Cola Company 1960s Pepsi ad targeted at Early Baby Boomers. • BooMeRs ARe eAsIlY ReAchABle BY MAnY of the sAMe tools used foR YoungeR geneRAtIons — while late to the game, they are now the fastest growing generation for social media and smartphone usage. + 52% use social media sites, with Facebook dominating. 50% CHARGING Source: Pew Research PIP Report, 2012 Source: Pew Research Smartphone Ownership, 2013 50% CHARGING + Nearly 50% of Boomers are smartphone users. Source: Boomers do not relate to ads that appear fake or unrealistic.
  8. 8. 9 how do we engAge BooMeRs? MotIvAtoRs iNDepeNDeNce • coNstaNt stiMulatioN • tHirst for KNowleDGe • connectIon oppoRtunItIes • eNaBliNG a BalaNceD life • coNtiNueD learNiNG • Variety New experieNces • social coNNectioNs • pHysical/MeNtal eNricHMeNt • • eleVateD Quality of experieNces • eNGaGeMeNt • creatiVity outlets practicality + iNDulGeNce • atteNtioN aND wooiNG • appreciatioN for loyalty • • NostalGia • exclusiVe offeriNGs aND cHoice • rewarDs respect aND Value • releVaNce • coNNectiVity • • acKNowleDGeMeNt • realisM • youNG-as-you-act iNclusiVity
  9. 9. 10 Commitment to BOOMER Relevance APPLIED MOTIVATORS / CONNECTION 3New/Quality of Experiences 3Young-As-You-Act Inclusivity 3Connectivity 3Respect and Relevance toyota avalon toyota venza • In 2011, Toyota launched a campaign for Venza, which satirized • Toyota recently launched a new Avalon campaign targeting misconceptions about Boomers’ tech incompetence and boring younger Boomers, in an attempt to lower the average Avalon lifestyle. owners’ age from 67. • Toyota was effective in celebrating the outgoing and active nature of Boomers, in contrast with younger consumers’ tech obsession. • Success was achieved, with over 70% of Venzas sold to Boomers. • The “Let’s Go Places” tagline encouraged Boomers to try new experiences. • The campaign utilized optimized messaging for tablets and mobile devices, knowing that boomers are tech-savvy. Source: Source:
  10. 10. 11 innovation FOR boomers • Heineken utilizes its Ideas Brewery to crowdsource innovation. The April 2013 “Challenge” asked consumers around the world to APPLIED MOTIVATORS / CONNECTION 3Variety/Thirst for Knowledge 3Exclusive Offerings 3Physical/ provide ideas for a new beer concept targeted at people age 60+ that would fit their lifestyle wants and needs. • This brand demonstrated keen insight on the mindset of this target via the categories in which ideas had to flow to qualify for the $10,000 prize. + Quality experiences + Learning and re-discovery + More time for social activities • The winning idea was “Fahrenheit 60+,” a series of new tastes/brews with a unique story behind each within the Heineken brand. Mental Enrichment 3New/Quality Experiences Source:
  11. 11. 12 connectIng: nutRItIon And nostAlgIA • Declining category sales (fewer children and Millennials who sit down for cereal at breakfast) is driving cereal manufacturers to find ways to make their products relevant again in expanded ways with adults. Specifically with Boomers who are still engaged with this product for breakfast and as a snack. ApplIed MotIvAtoRs / connectIon 3RewARds 3nostAlgIA 3BAlAnced lIfe 3connectIvItY • Specific brand actions are leveraging trends among Boomers — happy nostalgic memories and increasing interest in health and nutrition. + Lucky Charms is a brand “built” on Late Boomers (introduced in 1964), and with still-remaining value from a nostalgic standpoint to this generation. New communication that helps adults remember “how good of a cereal it is” are resulting in increased sales and growth in usage by adult audiences, including Boomers. — “We know that adults have always loved Lucky Charms and by reconnecting them with the brand, we have reignited their love of one of their favorite things from childhood.” (Carla Vernon, General Mills’ Marketing Director for Lucky Charms.) + Kellogg’s is introducing multiple products with nutrition-based innovation, including: Raisin Brand Omega-3 and Special K MultiGrain. Its Kashi brand will roll out a new Heart to Heart product with flax and omega 3. • These brands are attempting to stay relevant and evolve with consumer wants/needs. Source:
  12. 12. 13 pItfAlls of IgnoRIng BooMeR InsIghts • In April 2013, Amazon launched its 50+ Active & Healthy Living store, a hub for Boomers to shop for health, beauty and ApplIed MotIvAtoRs / connectIon 3 pRActIcAlItY And vARIetY 3 AcKnowledgeMent ReAlIsM Young-As-You-Act InclusIvItY entertainment products. • Items grouped on the site are likely accurate in their practicality for this audience, and the site does, in fact, contain items for both young and old consumers, such as health/exercise, technology and travel. • However, it also is “loudly visible” in what could be perceived as “products for the elderly,” i.e., mobility, incontinence, wrinkle creams, hair coloring. • Amazon has received significant negative feedback from those who feel the brand is generalizing the “needs” of the 50+ age group. • The concept has legs, and depending on Amazon’s success with this idea, other retailers may follow suit. However, based on comments from the retail industry and consumers across multiple independent resources, additional work is needed to better align the concept with the reality of this consumer segment. Source:
  13. 13. 14 If nothIng else, Know thIs… • In the mad dash to engage with Millennials, DON’T FORGET ABOUT BOOMERS — they are an important consumer group. • Opportunities for products/services and engagement exist with this generation that go far beyond a narrowed focus on “gray hairs.” • They represent A LARGE POPULATION BASE THAT HAS TREMENDOUS SPENDING POWER. • To be successful, marketers must understand their emotionally-charged motivators, and implement actions that will relevantly connect and cultivate loyalty. This means: – DON’T STEREOTYPE this generation and the products and services they need. – Don’t use IMAGERY AND COMMUNICATIONS CHANNELS that are not in touch with the reality of this consumer base. – Remember their YOUTHFUL MINDSET, which helps them feel and stay “young” longer. – Respect their value and acknowledge their practical and DISCERNING DECISION-MAKING EXPERIENCES. – Engage with them in ways that REWARD THEM WITH CHOICES, inclusivity, creativity outlets and new/elevated experiences that enhance their lives.