More Babe Than Boomer. Marketers Miss the Mark
Millennials may have their youth but Baby Boomers have the money! Do not call them Seniors, Boomers or consider them Old! They may have born during the Post World War II period (1946-1964) but this group of 76.4 million people (Population Reference Bureau) who have lived through unparalleled social and technological changes, do not see themselves as elderly!
Smart executives targeting the Boomer market will not review the “good old days,” as this cohort is focused on the future with dreams and goals to pursue until they die. This youth-oriented attitude is linked to their “25 year-old selves” – remember Boomers took the concept of Peter Pan very seriously, embracing the idea of never growing up- literally – and they continue to seek the “fountain of youth.”
Boomers want to learn new skills and stay current. Smart marketing executives who put them in youthful situations where they can feel “sexy” and travel to exotic destinations will have their attention. Boomers do not want to hear that there is something wrong with them or have diminished capacity. They want to be improved; not fixed!
Marketers Don’t Get It
As I interview international c-suite executives in the hotel, travel and tourism industry and ask them to identify their primary target market, time and again the response is “Millennials.”
From a PR point of view the Millennials receive an A+ for making marketers think they are the most important target for every product short of “Depends” and denture adhesive. Born from 1980 – 1999 the 73 million (USA) Millennials (also known as Generation Y) represent 25 percent of the US population.
The US Chamber Foundation finds that their collective direct spending hovers at $200 billion annually and will increase as larger numbers advance in their careers. This group makes-up one-fifth of all global tourists (World Youth Student and Educational Travel Confederation) and generates an estimated $180 billion in tourism-related revenue. The Boston Consulting Group finds that by 2020 this group will account for 50 percent of all business travel spending. However, it is important to remember that Millennials are also under or unemployed, burdened with debt and living with parents or other family members.
Companies providing goods and services should pay attention to the Boomer demographics; however, the majority of businesses stick to their habit of focusing exclusively on the young disregarding the older market segment. This has always been a poor choice in terms of ethics; it may very soon become a poor choice in terms of commercial success.
While Millennials are a very attractive target market and certainly should be part of the marketing mix, a large and significantly lucrative cohort that is overlooked from a marketing perspective are the Baby Boomers.
Here are the Facts
One of the largest under-tapped markets in the US economy, Boomers have a disposable income valued at $28 trillion and a median net worth of $112,048 – about 15 times the $7240 reported for those younger than 35. By 2030 a projected 71 million Americans will be 65 years of age or older (US Census Bureau).
There is a misconception that Boomers spend less, have little interest in new products and technology and have brand preferences that are not likely to change. This is not true! Boomers spending is growing at a pace that leaves younger generations in the dust. The 116 million US consumers 50+ spent $2.9 trillion in 2012 – a 45 percent increase over the past 10 years. In fact, Boomers are among the biggest buyers of new technology and new cars.
Boomers are wealthy. The 55+ controls more than three-fourths of America’s wealth, have a median household income that is 55 percent greater than post-Boomers and 61 percent more than pre-Boomers. The US Government Consumer Expenditure Survey finds that Boomers outspend other generations by an estimated $400 billion each year on consumer goods and services.
So- this is a market that should be a major target market; however, research indicates that less than 5 percent of advertisers target this generation. Lewis Kern at Forbes (November 9, 2012) finds that Boomers are the most neglected wealthy people in the history of marketing and most companies fail to effectively reach them.
Boomers know they are not a target. According to a 2009 survey conducted by Google and Nielsen, 8 in 10 Boomers believed that advertising is targeting a younger consumer.
Virtual Reality Testing
People are living longer and 65 does not mean that the remaining years will be spent entirely on the golf course or reading books. This market has been and continues to be actively participating in the “real world.”
Boomers are online. They represent one-third of the 195.3 million Internet users in the U.S. and the Web’s largest constituency (2013). In 2012 Boomers (47-65) spent 27 hours online per week – 2 hours longer than millennial demographics. The Internet is the main information source – outpacing television and print media. They also search online for news and weather, shopping, coupons, travel and discounts, food information and gaming, frequently visiting dating sites and watching videos for entertainment. One-third of Boomers described themselves as “heavy Internet users.”
• American Association of Retired Persons (AARP) – individuals aged 50+ own 80 percent of US financial assets and dispose of 50 percent of discretionary income but received only 10 percent of ad messages; seniors as a consumer group are largely being ignored
• Boomers see travel as a necessity spending $157 billion on trips every year and polls rank travel at their No. 1 leisure activity
• Smartphone usage: 44 percent of users 50+ access the Internet or check email daily
• Online videos: 41 percent of Internet users 50-64 and 27 percent of adults 65+ report watching online videos
• Social networking: 27.4 million people 55+ engage in social networking; 19 million are on Facebook
• 87 percent of Boomers are high school graduates; more than 50 percent have attended college – they are smart and successful
What Do Boomers Want
Since Boomers do not see themselves as aging they put in the effort to stay physically fit; some are in better shape today than when they were in their 20s. This cohort is interested in adventure travel and holidays include kayaking, cycling, hiking, scuba diving, swimming, skiing, and mountain climbing.
Because they do not identify with “old people” (remember they started “Don’t trust anyone over 30”), Boomers do not want to be like their parents and Early Bird specials and senior discounts hold little or no appeal.
Images that are stuffy or stodgy are a turn-off and they relate best to younger images. They have traveled more than their predecessors and are now looking for exotic destinations and more in-depth experiences. They are not likely to sign up for a bus tour of the USA – they have been there and done that on bicycle trips. Boomers are willing to pay for the luxury, expertise and convenience they are seeking.
This group is redefining aging. Boomers grew up in the age of consumerism. Their sheer size helped define brands. They continue to be rebellious and they what they want and when they want it.
They want to:
• Have fun and this includes companionship, stimulation, cultural/social experiences
• Meet local people while playing golf, dining or enjoying a wine tasting or cooking class
• Make travel purchases that are quick, easy and convenient
• Experience immediate gratification; 800 numbers and emails responses from well-trained employees available 24/7/365
• Control in designing their travel experiences; options are a necessity
• Experience interactive activities. Rather than visit a museum, introduce them to living artists in a studio or gallery
• Made to feel special. Whether budget or luxury travel, they want to believe their experience is the BEST (Master Card has this focus with after-hour access to museums, behind the scenes tours)
• Associate with people like themselves; they do not identify with people older than they are
Are We There Yet
It is important to note that Boomers are not homogenous – some are childless by choice, others have new babies and some have grandchildren, some are raising grandchildren, while others cannot get their children out of the house. Programs, destinations, accommodations, budgets, time and travel companions are not “one size fits all.”
Boomers invented the question, “Are we there yet?” Long stretches of road time means that tour operators must plan short trips with frequent interesting stops as well as personal video screens and Internet access. To get the Boomer business, tour operators must be able to demonstrate their expertise and add value by offering opportunities the Boomer could not get on their own. The tour guides should be more like personal trainers, able to discuss and share their knowledge and expertise about the program, destination, and experiences.
Because Boomers have traveled, they are skeptical about “promises” from hotels, destinations and cruise ship. They need to be convinced and therefore require specific and detailed information before making a buying decision. Descriptions of the “others” on the trip as well as third party endorsements help to close the sale.
Marketing to Boomers
It is a certainly that as millions of American born between 1945 and 1960 retire, more than one in every four Americans- they will become the largest purchasing demographic for hotels, lodging, restaurants, transportation and entertainment. To reach the Boomer, marketers must deliver:
1. Relevant messages. What does your destination/hotel offer this demographic? What unique experiences are designed “just for them?”
2. Virtual information. SageAge Strategies found that the adoption rate of social media users 65 and older grew 150 percent form 2009-2011, with the fastest growing group – 74+. Electronic usage continues to grow. Baby Boomers can be reached through websites and Facebook.
3. Experiential opportunities. Focus on the experience including local community activities; things to do/see – from cooking classes to wine tastings, from behind-the-scenes at theaters to one-to-one conversations with sport celebrities.
4. Accurate descriptions: Is the hotel/restaurant child/family – friendly or primarily for adults, couples, single or LGBT? Are there extra-fees for traveling solo? Are there resort and Wi-Fi fees – insert them in the marketing messages from the beginning – don’t make it a surprise upon check-out.
5. Luxury. As a concept luxury is alive and well and Boomers continue to associate it with value, quality and customer service. Even affluent consumers are foregoing luxury goods for extravagant travel and 80 percent selected an experience over an item according to a recent Martini Media report.
6. Ease in closing the sale. Brands are important but referrals, timely messaging and promotional offers help to close the sale. Boomers have spent more than 40 years digesting information and deciding what he/she wants. The advertiser telling the complete story will have the advantage.
Meeting Boomer Needs
It is no surprise that hotels, restaurants and airports are developing interiors that are child-safe and Millennial-savvy; the same “heads up” reality must be integrated into interiors for Baby Boomers who are responsible for 80 percent of travel spending and “invest” over $150 billion a year on travel.
• Properties should be totally ADA compliant
• Door handles should open easily (i.e., positioned for wheelchair access and designed for guests with arthritis)
• Decorative grab bars in shower; walk-in showers with hand spray
• In-room wine and coffee bars
• Adequate interior lighting
• Furniture/chairs with structured cushions making it easier to stand up
• Desks with flexible heights (i.e., wheelchair/height adjustable), lighting and outlets for electronics at table height
• Electric bathroom mirrors that make Boomers look younger and better
• Soft/subtle lighting throughout the entire property/restaurants
• Shorter walking distances to services and amenities
• Minimum number of steps and staircases (with adequate lighting)
• Slip – proof floors
Young at Heart
Coming of Age Incorporated, a consumer group finds that Baby Boomers are turning 50 at a rate of one every 7-10 seconds. That is more than 12,000 each day and over 4 million a year. This affluent group is among the wealthiest, best educated and most sophisticated purchasers in the marketplace and yet they are being overlooked by c-suite executives and their marketing team.
Candace Corlett, president of the 50-plus practice of WSL Strategic Retails One, has determined that of the disconnects in reaching the Boomer market is the fact that the average age of today’s brand manager is 29 and the account executive is 28. “In our sensitivity training sessions, when we ask them to draw someone in their 50s or 60s,” she says, “often what they come up with is a picture of someone in their 90s.” If it is these “experts” who tell companies how to advertise it is not surprising that companies are convinced that they should be targeting millennials and not Boomers.
The Traveling Baby Boomer market is waiting to be approached by savvy hoteliers, restauranteurs and destinations. They will listen to messages that address community activities, provide opportunities to make connections (unmarried Boomers account for 21 million households or 46 percent of the Boomer market), have the opportunity to contribute to society and offer a chance for a creative and unique experience. Although the calendar says they have reached middle age, many in this group view themselves as closer to rock climbing than retiring.
This cohort is open-minded, willing to try new brands, products, services, destinations and eager to explore what is “new.” They have the money to spend and are willing to spend it if the experience will improve their health or the quality of their lives.
It will be interesting to watch which hotel group, restaurant and destination is savvy enough to grab onto the Boomer market – and ride it all the way to profitability.