The Demographic Impact of Changing Lifecycles

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The Demographic Impact of Changing Lifecycles

  1. 1. The  Demographic  Impact  of  Changing  Lifecycles   Observa(ons  &  Predic(ons   JOEL  BEVIN   8  December  2010  
  2. 2.  Global  popula?on  trends    Genera?ons  and  life  phases  of  the  future    Marke?ng  to  future  genera?ons    Income  and  consump?on  trends  of  the  future  2   8  December  2010  
  3. 3. Key  messages    The   social   and   economic   success   of   each   na?on   will   be   individually   influenced  by  global  demographic  trends.    Lifecycles   have   changed   markedly   over   the   last   half   century   and   we   must   plan  for  similar  changes  over  the  next  half  century.    As  the  habits,  behaviours  and  spending  paLerns  of  each  genera?on  change,   so  to  will  the  marke?ng  model  used  to  reach  each  target  market.    Combining   demographic   trends   with   the   changing   lifecycle   helps   us   understand  the  who,  how,  what,  when  and  why  ques?ons  that  form  the  basis   of  demographic  marke?ng.  3   8  December  2010  
  4. 4.  Global  popula?on  trends    Genera?ons  and  life  phases  of  the  future    Marke?ng  to  future  genera?ons    Income  and  consump?on  trends  of  the  future  4   8  December  2010  
  5. 5. World  popula?on   1900-­‐2100   War   Baby  boom   Capacity   Figh?ng  rather  than   Making  up  for  lost  ?me…4  billion   Humanity  peaks…expected   reproducing...1  billion  extra   added  over  the  50  years  to  2000   to  top  8.9  billion  in  2068   people  over  the  50  years  to  1950   9   8   7   6  Billions   5   4   3   2   1   0   1900   1910   1920   1930   1940   1950   1960   1970   1980   1990   2000   2010   2020   2030   2040   2050   2060   2070   2080   2090   2100   Source:  United  Na9ons  Popula9on  Division,  2010   5   8  December  2010  
  6. 6. 0  –  14   2010  to  2050   Rank  2010   2010   2010-­‐2050   Growth   Country   Economic  and  demographic   (Rank  2050)   (million)   (million)   Posi9ve  growth  due  to  a   higher  birth  rate  of   stagna9on  throughout   Decline   1  (1)   India   375   -­‐73   Mexican  migrants   much  of  Europe   2  (2)   China   265   -­‐50   No  change   3  (3)   Nigeria   68   11   4  (8)   Indonesia   64   -­‐12   5  (4)   United  States   63   6   6  (6)   Pakistan   59   5   7  (7)   Bangladesh   55   -­‐2   8  (10)   Brazil   53   -­‐8   9  (9)   Ethiopia   38   13   10  (5)   Congo   33   31   11  (12)   Philippines   32   -­‐4   12  (17)   Mexico   31   -­‐9   13  (14)   Egypt   25   -­‐1   14  (18)   Viet  Nam   24   -­‐3   15  (24)   Russia   21   -­‐5   16  (22)   Turkey   20   -­‐3   17  (16)   Tanzania   19   4   18  (21)   Iran   19   -­‐1   19  (15)   Kenya   17   7   20  (31)   Japan   17   -­‐6   High  third-­‐ Top  20   1,299   -­‐100   world  birth   Remainder   560   65   Economic  development   rate  remains   Chinese  one-­‐child  policy   World   1,859   -­‐35   in  South  America  drives   in  Africa   and  Asian  development   the  birth  rate  down   sees  birth  rate  decline  Source:  United  Na9ons  Popula9on  Division,  2010   6   8  December  2010  
  7. 7. 15  –  64   2010  to  2050   Rank  2010   2010   2010-­‐2050   Growth   Country   Declining  workforce  in  China,   (Rank  2050)   (million)   (million)   A  shrinking  workforce…may  force   Japan  and  Russia…a  risk  to   Decline   1  (2)   China   973   -­‐114   Europe  to  open  borders  to   future  economic  growth?   2  (1)   India   780   336   working-­‐age  migrants   3  (3)   United  States   211   37   4  (6)   Indonesia   161   29   5  (10)   Brazil   132   28   6  (4)   Pakistan   107   89   7  (7)   Bangladesh   105   66   8  (15)   Russia   102   -­‐36   9  (5)   Nigeria   86   107   10  (21)   Japan   82   -­‐30   11  (12)   Mexico   72   10   12  (14)   Viet  Nam   62   14   13  (11)   Philippines   57   38   14  (25)   Germany   54   -­‐13   15  (17)   Turkey   53   11   16  (16)   Iran   52   12   17  (13)   Egypt   50   30   18  (9)   Ethiopia   49   73   19  (27)   Thailand   46   -­‐5   Workforce  expands   20  (28)   France   41   -­‐1   in  Africa…the  new   Top  20   3,276   682   Expanding  workforce  in   global  labour  pool?   the  Americas…supported   Remainder   1,241   674   Increasing  workforce   by  high  birth  rate  and   makes  south-­‐east   World   4,518   1,356   liberal  immigra9on  policy   Asia  the  outsourcing  Source:  United  Na9ons  Popula9on  Division,  2010   hub  of  the  world   7   8  December  2010  
  8. 8. 65+   2010  to  2050   Rank  2010   2010   2010-­‐2050   Country   (Rank  2050)   (million)   (million)   The  post-­‐WWII  spike  in  births   Growth   1  (1)   China   132   304   created  the  genera9on  of   2  (2)   India   75   216   Baby  Boomers…the  first  one   re9ring  next  year  in  2011   3  (3)   United  States   52   64   4  (6)   Japan   37   18   5  (11)   Russia   22   10   6  (10)   Germany   21   11   7  (4)   Indonesia   16   51   8  (5)   Brazil   16   47   9  (13)   Italy   16   9   10  (14)   France   14   11   11  (15)   United   13   10   Kingdom   12  (18)   Spain   10   11   13  (8)   Mexico   9   27   14  (30)   Ukraine   9   2   15  (7)   Pakistan   8   29   16  (9)   Bangladesh   7   27   17  (20)   Thailand   7   14   18  (21)   Rep.  of  Korea   6   14   19  (29)   Poland   6   6   20  (12)   Viet  Nam   6   23   Re9rees  draw  on  social  security  and   Top  20   482   904   health  care…worsening  dependency   Remainder   153   354   ra9os  (re9red  person  per  worker)  may   threaten  social  order  and  economic   World   635   1,258   growth  around  the  world  Source:  United  Na9ons  Popula9on  Division,  2010   8   8  December  2010  
  9. 9. United  States  –  age  profile   1950,  2010  and  2050  2050   19%   61%   20%   N  =  439  m  2010   20%   67%   13%   N  =  307  m  1950   27%   65%   8%   N  =  152  m   Younger   Older   0-­‐14   15-­‐64   65+  Source:  United  Na9ons  Popula9on  Division,  2010   9   8  December  2010  
  10. 10. China  –  age  profile   1950,  2010  and  2050  2050   15%   61%   24%   N  =  1.41  b   20%   72%   8%   N  =  1.35  b  2010  1950   34%   62%   4%   N  =  555  m   Younger   Older   0-­‐14   15-­‐64   65+  Source:  United  Na9ons  Popula9on  Division,  2010   10   8  December  2010  
  11. 11. India  –  age  profile   1950,  2010  and  2050  2050   18%   67%   14%   N  =  1.66  b   31%   64%   5%   N  =  1.22  b  2010  1950   37%   59%   3%   N  =  372  m   Younger   Older   0-­‐14   15-­‐64   65+  Source:  United  Na9ons  Popula9on  Division,  2010   11   8  December  2010  
  12. 12. Japan  –  age  profile   1950,  2010  and  2050  2050   11%   53%   36%   N  =  101  m   13%   64%   23%   N  =  128  m  2010  1950   35%   60%   5%   N  =  83  m   Younger   Older   0-­‐14   15-­‐64   65+  Source:  United  Na9ons  Popula9on  Division,  2010   12   8  December  2010  
  13. 13.  Global  popula?on  trends    Genera?ons  and  life  phases  of  the  future    Marke?ng  to  future  genera?ons    Income  and  consump?on  trends  of  the  future   8  December  2010  13  
  14. 14. The  Lifecycle   1950   CHILDHOOD   RESPONSIBILITY   LIFESTYLE   0   20   21   59   60  • Large  tradi?onal  family   • Adulthood  –  begins  drinking  and  vo?ng   • Re?rement  is  planned  structure   • Chooses  a  career  and  wife  (both  for  life)   • Shorter  lifespan  and  • Limited  independence   • Income  used  to  maintain  household   reduced  consump?on  14   8  December  2010  
  15. 15. The  Lifecycle   2010   CHILDHOOD   EXPERIENTIAL   RESPONSIBILITY   LIFESTYLE   0   14   15   29   30   59   60   • Independent  but  lives   • Begin  family  with  dual   • Officially  re?red  but  • Smaller  family   at  home   incomes   remains  working  • Focus  on   • Con?nues  educa?on   • Meaningful  career  sought   • Focus  on  health  to  educa?on  &  extra-­‐ • Experiments  with   • Begins  to  plan  for  re?rement   maintain  independence  curricular  ac?vi?es   careers  &  lifestyles   • Global  network  15   8  December  2010  
  16. 16. The  Lifecycle   2050   CHILDHOOD   EXPERIENTIAL   RESPONSIBILITY   CONSOLIDATE   LIFESTYLE   0   9   10   29   30   59   60   79   80   • Delayed  responsibility   • Con?nues  to  • Childhood   allows  freedom   • No  expecta?on  to  begin   work  (personal  &   • Independent  shortened   • Personal  &    professional   family   financial  reasons   • Financial  &  • Demands   purpose  merged   • Diverse  lifestyles  which   • Transient  lifestyle   poli?cal  power  independence   • Independent  but  lives  at   remain  in  a  state  of  flux   &  loca?on   home  16   8  December  2010  
  17. 17. The  Consump?on  Lifecycle   2050   CHILDHOOD   EXPERIENTIAL   RESPONSIBILITY   CONSOLIDATE   LIFESTYLE   0   9   10   29   30   59   60   79   80   • Experien?al  consump?on  • Independent   • No  obliga?on  to  save  &   • Will  not  sacrifice   • Invests  in  self   • Longer  life  span  consump?on   lifestyle  for  family   educa?on  and   requires  managed   spends  freely  but  with   spending  choices   purpose   health   17   8  December  2010  
  18. 18. The  Communica?on  Lifecycle   2050   CHILDHOOD   EXPERIENTIAL   RESPONSIBILITY   CONSOLIDATE   LIFESTYLE   0   9   10   29   30   59   60   79   80  • Social  network   • Merged  social  &   • Technology  separate  to  family   • Renewed  focus  on   • Connected  to   professional  network   maintains  • Communica?on   fostering  personal   globally-­‐spread   • Wide  and  varied  circle  of   connec?on  to    instantaneous  and   rela?onships   friends  &  family   friends   social  networks  unrestricted   18   8  December  2010  
  19. 19. The  Work  Lifecycle   2050   CHILDHOOD   EXPERIENTIAL   RESPONSIBILITY   CONSOLIDATE   LIFESTYLE   0   9   10   29   30   59   60   79   80   • Remains  in  • Dual-­‐income   • Early  working  age   • Career  &  country  of   workforce  on   • Con?nues  to  parents  reinforces   • Combines  travel  &  work   residence  are  transient   own  terms   work  in  casual  or  the  importance  of   • Limited  responsibility   • Iden?ty  to  be  defined  by   • Demands   volunteer  role  career   allows  mul?ple  careers   our  work   flexibility   19   8  December  2010  
  20. 20. The  Health  Lifecycle   2050   CHILDHOOD   EXPERIENTIAL   RESPONSIBILITY   CONSOLIDATE   LIFESTYLE   0   9   10   29   30   59   60   79   80   • Greater  health  awareness   • Invests  for   • Physically   • Self-­‐diagnose  using  social   • Health  rou?ne  part  of   healthy  old  age   independent    • Benefits  from   network   lifestyle  using  tradi?onal   • Pursues   • Chooses  smaller  family   • Invest  in  health  through   and  modern  therapies   ‘youth’  with   preventa?ve   natural  &  ar?ficial  means   despera?on   measures   20   8  December  2010  
  21. 21. The  Educa?on  Lifecycle   2050   CHILDHOOD   EXPERIENTIAL   RESPONSIBILITY   CONSOLIDATE   LIFESTYLE   0   9   10   29   30   59   60   79   80   • Interna?onal  curriculum   • Mul?ple  careers  and   • Pursues  further  • Na?onal  and   allows  global  mobility   • Transi?on  to   constantly  reskills  interna?onal   • Online  educa?on   re?rement  with   unofficial   • Online  educa?on  crucial   educa?on  tes?ng  begins   demanded  and  accepted   educa?on   in  busy  lives   by  students  and  industry   21   8  December  2010  
  22. 22.  Global  popula?on  trends    Genera?ons  and  life  phases  of  the  future    Marke?ng  to  future  genera?ons    Income  and  consump?on  trends  of  the  future   8  December  2010  22  
  23. 23. Era  1  –  Produc?on   PRODUCTION   Factory   • Simplified  supply  chain   • Scarcity  during  industrial   revolu9on  meant   manufacturers  could  sell   all  that  they  could   Vendor   produce.   • Focus  was  on  produc9on   and  distribu9on  at  the   lowest  cost   Consumer  23   8  December  2010  
  24. 24. Era  2  –  Sales   SALES   Factory   Vendor   • Increased  compe99on  at   start  of  20th  century.   • Greater  dialogue   between  factory  and   vendor   • Focus  on  selling  using   communica9ons,   adver9sing  and  branding.   Consumer  24   8  December  2010  
  25. 25. Era  3  –  Segmenta?on   SEGMENTATION   Factory   Vendor   • Market  becomes   saturated  from  1960   onwards.   Marke9ng   • Intense  compe99on  for   consumers  leads  to   introduc9on  of  ‘marke9ng’   Focus  on  communica9on   and  branding  with   segmented  consumers.   Consumer   Consumer   Consumer   Consumer  25   8  December  2010  
  26. 26. The  next  era  –  Consumer-­‐defined   Consumer   CONSUMER-­‐DEFINED   Consumer   Consumer   • Consumers  define   Consumer   the  product.   • Vendor,  marke9ng   department  and   factory  work   together  to  sa9sfy   consumer.   • Focus  on   differen9a9on  and   collabora9on.   Vendor   Marke9ng   Factory  26   8  December  2010  
  27. 27.  Global  popula?on  trends    Genera?ons  and  life  phases  of  the  future    Marke?ng  to  future  genera?ons    Income  and  consump?on  trends  of  the  future   8  December  2010  27  
  28. 28. Income  aner  tax   2008    80,000        70,000      Average  annual  income  by  age  of  household    60,000       reference  person  ($US)    50,000        40,000        30,000        20,000        10,000        -­‐           <25   25-­‐34   35-­‐44   45-­‐54   55-­‐64   65+   Source:  US  Consumer  Expenditure  Survey,  2007-­‐08   28   8  December  2010  
  29. 29. Food  spend   2008    8,000        7,000      Average  annual  spend  by  age  of  household    6,000       reference  person  ($US)    5,000        4,000        3,000        2,000        1,000        -­‐           <25   25-­‐34   35-­‐44   45-­‐54   55-­‐64   65+   Source:  US  Consumer  Expenditure  Survey,  2007-­‐08   29   8  December  2010  
  30. 30. Housing  spend   2008    25,000      Average  annual  spend  by  age  of  household    20,000       reference  person  ($US)    15,000        10,000        5,000        -­‐           <25   25-­‐34   35-­‐44   45-­‐54   55-­‐64   65+   Source:  US  Consumer  Expenditure  Survey,  2007-­‐08   30   8  December  2010  
  31. 31. Apparel  spend   2008    2,500      Average  annual  spend  by  age  of  household    2,000       reference  person  ($US)    1,500        1,000        500        -­‐           <25   25-­‐34   35-­‐44   45-­‐54   55-­‐64   65+   Source:  US  Consumer  Expenditure  Survey,  2007-­‐08   31   8  December  2010  
  32. 32. Health  spend   2008    5,000        4,500      Average  annual  spend  by  age  of  household    4,000        3,500       reference  person  ($US)    3,000        2,500        2,000        1,500        1,000        500        -­‐           <25   25-­‐34   35-­‐44   45-­‐54   55-­‐64   65+   Source:  US  Consumer  Expenditure  Survey,  2007-­‐08   32   8  December  2010  
  33. 33. Educa?on  spend   2008    2,000        1,800      Average  annual  spend  by  age  of  household    1,600        1,400       reference  person  ($US)    1,200        1,000        800        600        400        200        -­‐           <25   25-­‐34   35-­‐44   45-­‐54   55-­‐64   65+   Source:  US  Consumer  Expenditure  Survey,  2007-­‐08   33   8  December  2010  
  34. 34. Social  security  spend   2008    25,000      Average  annual  spend  by  age  of  household    20,000       reference  person  ($US)    15,000        10,000        5,000        -­‐           <25   25-­‐34   35-­‐44   45-­‐54   55-­‐64   65+   Source:  US  Consumer  Expenditure  Survey,  2007-­‐08   34   8  December  2010  
  35. 35. Concluding  messages   Future   demographic   marke?ng   techniques   must   balance   quan?ta?ve  demographic  forecasts  with  qualita?ve  forecasts   New   global   demographics   will   challenge   na?onal   &   interna?onal  management  of  an  ageing  popula?on  and  a  shrinking  workforce   Changing   lifecycles   require   micro-­‐segmenta?on   in   order   to   reach   and  service  the  demands  of  new  genera?ons   New   era   of   collabora?on   between   companies   and   consumer   who   are  increasingly  able  to  sa?sfy  themselves   As  lifecycles  change  so  does  the  ?meline  of  purchasing  decisions  –  earlier  in  some  cases  and  delayed  in  others  35   8  December  2010  
  36. 36. Arigato  gozaimasu!    Ques?ons?   JOEL  BEVIN   joelfsb@gmail.com   UNIVERSITY  OF  POMPEU  FABRA  (BARCELONA)   8  December  2010  

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