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11/01/2013

COMING of AGE

Millennials. Gen X-ers. Baby Boomers.

Each of these generations has redefined ways of shopping and spending, and are forcing retailers and marketers to rethink how to best catch their attention–and retain their loyalty–as consumers.

But it's Baby Boomers (those born between 1946 and 1964) who have garnered the biggest attention in retail in recent years. It makes sense: Baby Boomers, according to a June 20, 2013, Newswire post on Nielsen.com, make up 25 percent of the U.S. population. And more than that, they control 70 percent of disposable income in this country; approximately 50 percent of consumer packaged goods (CPG) sales are to Boomers.

"The good news for retailers is that Baby Boomers love shopping. They love shopping online, they love shopping in stores, and they shop more often," says Michael Moriarty, partner at Chicago-based A.T. Kearney and co-author of the study, "Understanding the Needs and Consequences of the Ageing Consumer."



"The good news for retailers is that Baby Boomers love shopping. They love shopping online, they love shopping in stores, and they shop more often."

–Michael Moriarty,

A.T. Kearney


"Baby Boomers generally buy less when they shop," he explains, "but it's because they shop more frequently. They are the perfect retail shopper segment. They're rich, they know how to use technology, and they're growing rapidly."

It's estimated that by 2030, the Baby Boomer segment older than 65 will be approximately 71.5 million, and by 2050, 86.7 million. Many retailers, manufacturers and marketers know that the Baby Boomers are the demographic to reach. The problem is, marketers just aren't reaching them.

All for Boomers and Boomers for All

Starting with the post-World War II era, marketing efforts have focused on the 15- to 25-year-old demographic. The idea was to grab young consumers and keep them for a long time. This kind of marketing dovetailed with Baby Boomers coming into their teens–what marketers deem the formative years for messaging.

The problem, however, is that the mindset of most marketers is still on the 15- to 25-year-olds. And today that means Millennials. But the Baby Boomers aren't 25, or even 35, anymore. What works for a Millennial doesn't necessarily translate for Baby Boomers, and savvy retailers and manufacturers need to recognize this.

The concept of age has changed. As Moriarty says, "Being 70 years old today is not the same as being 70 years old 30 years ago." The assumptions we make about people age 55 to 65, or 65 to 80, are generally tainted by the way we think of our parents or grandparents. And that's generally incorrect, he says. Seventy-year-old women are interested in novel ideas and products in cosmetics. Seventy-year-old men are interested in fashion. But bear in mind that Baby Boomers, while interested in shopping, aren't interested in new products for newness' sake. They want products that do what they need, and while they like a good price, they're not price shoppers. Baby Boomers are willing to pay more for products, if the added value is right.

Baby Boomer women drive most consumer purchases in the United States, says Craig Vogel, director of the Center of Design, Research and Innovation at the University of Cincinnati. Vogel also is president of the Live Well Collaborative, a partnership between the university and corporations that researches products to benefit the over-50 population. The collaborative has partnered with several corporations in its six years, with CPG giant Procter & Gamble as its most consistent partner.

"Most of the big purchases are made by women, even if men have a hand in the decision-making process. And that's a trend that's not well understood," Vogel says. Additionally, through Live Well research, Vogel has found that Baby Boomer women and their daughters talk much more directly with each other, and affect each others' purchases, more than Boomers do, or did, with their parents.

"You see a lot of discussions going back and forth, and there's a lot of shared knowledge going on about certain trends," Vogel says. "We call that trans-generational consumers."

Possibly the most important thing about Boomer consumers is that they're often buying for up to three other generations. This "sandwich generation effect" means that Baby Boomers are often also making purchases for their parents, children and grandchildren.

The Power of Packaging

Offering Boomer consumers, with their tremendous purchasing power, exactly what they want and need starts with packaging.

"Baby Boomers are a huge audience in regards to package design," says Peter Clarke, CEO and founder of Product Ventures, Fairfield, Conn. In 2001, Product Ventures worked to redesign packaging for Duracell's hearing aids, responding to consumer feedback that the old packaging was cumbersome. In this case, seniors, often embarrassed by the physical limitations aging brings, chose to live with long-dead batteries rather than ask for help changing them.

"They are living longer and have a large amount of disposable income, but they also have to deal with changes that come with aging, such as reduced dexterity and failing eyesight." The key to designing for the mature consumer, Clarke adds, "is the clever implementation of universal, or inclusive, design so that the final product accommodates these changes without patronizing the consumer."

Vogel adds the example of medicine with senior-friendly caps, instead of just childproof ones. "It's an example of attempting to address the difference in age," he says. "But there are still too many packages that are far more difficult to open than they should be, and a lot of that is consistency of manufacturing and cost that is preventing people from thinking more about what packaging should be."

Channel Surfing

Once you have the perfect product for Baby Boomers, the question becomes how to communicate that to them. While advertising and marketing support is increasingly poured into social media, retailers need to understand that the same rules don't apply to every age group.

More often than not, younger generations are watching their favorite programs on their computers. But Baby Boomers are still watching actual televisions, making TV ads–both cable and network–a prime marketing option. The majority of newspaper subscriptions go to Boomers, and they also listen to radio.

These traditional marketing channels are effective with Baby Boomers, but Vogel notes that they also are merging in-store and online purchases. They want to touch, smell and taste a product directly, but once they find something that works, they'll often repurchase it online.

"It's an opportunity for retailers to create opportunities to experience products and to create an ongoing relationship that may be partly [in-] store and complemented by the Web," Vogel explains. "Right now people are saying 'either/or' when it comes to in-store or online, but with Boomers it's 'and.'"

Besides promotional channels, the promotions themselves are important. For example, Moriarty notes, the A.T. Kearney survey concluded that for Baby Boomers, more is not necessarily better. "Buy one, get one" promotions are not the way to attract mature consumers.

"If you're 85, two liters of sour cream are not better than one," Moriarty explains. "The whole concept of more for less is not really helpful."

But if more for less is not good for Boomer consumers, what is? Quality, Moriarty says: "Boomers want a promotion that expresses the quality of the best a retailer has to offer. That's good."

How to deliver products to Boomers is key, but the right message is essential.

Brent Green, founder of Denver-based Brent Green & Associates, a Boomer marketing consulting firm, gives the example of a recent successful Baby Boomer-focused campaign. St. Joseph's aspirin was originally marketed as baby aspirin when Baby Boomers were still kids. But more recently, the company employed actor Ken Osmond, who played Eddie Haskell in "Leave It to Beaver," to promote St. Joseph's, rebranding it as a product for heart health.

"They took an old brand that had died in terms of awareness and relevance, reached into a generation's memories and formative experience, and now they're promoting a completely different purpose for the product," Green explains. "It was an excellent strategy that took a generic, high commodity brand and reinvented it, and used a generational framework to reach to the Boomers."

But Green cautions against thinking nostalgia will automatically be a hit with Baby Boomer consumers. He cites the Just for Men product Touch of Gray campaign, which took a 1960s motto, "Don't trust anyone over the age of 30," and changed it to, "Don't trust anyone over the age of 90." The campaign failed on a number of levels, Green says, especially because it assumed that simply invoking a bygone era would make it a hit with that generation of consumers. But that's simply not true, Green says. "It's not a given that if you assume a generational framework that you truly understand nuance."

"If you're not of the generation you're marketing to, and have not thought critically about messaging and message strategy of the product, it's advisable that you hire people who are, or you get yourself educated to a level of sophistication for that segment," Green says. That doesn't mean that people outside of a demographic can't effectively market to it, he notes, but truly capturing it takes a team with a strong, intuitive sense of that demographic. "They must be well-educated at a very sophisticated level of nuance," he says.

Going Forward

As the population of Baby Boomers steadily increases, retailers and marketers need to continually focus and refocus on this group.



"The most important thing every company can do is figure out what age bracket and economic bracket they're functioning in, and start to have very good conversations with the consumers directly."

–Craig Vogel,

University of Cincinnati


"The most important thing every company can do is figure out what age bracket and economic bracket they're functioning in, and start to have very good conversations with the consumers directly, and start to find out what it is they prefer," says University of Cincinnati's Vogel. "It's not something you can figure out now, and it will work indefinitely."

Baby Boomers are evolving, and retailers must evolve with them if they want to stay relevant.

"Find the early adopters in that age group, and start creating ongoing, in-depth relationships through dialogue and testing," Vogel continues, "and really do the kind of homework it takes to own a market segment.

Molly Strzelecki is a freelance writer living in Chicago. She has been covering trends in the consumer packaged goods industry for more than a decade.