2 - OLDER IS BETTER (SENIOR MARKET TRENDS)

In 1989 Americans 40 and older became the biggest adult segment for the first time in US history, making them the new customer majority. The 40-plus age group is today 45% bigger than the 18-to-39 group, and will be 60% bigger by 2010. They also earn and spend more money. According to David Wolfe,

According to Mature Marketing & Research, baby boomers - those Americans born between 1946 and 1964 (who are now 40 to 58) - control more than half of the nation's discretionary income and three-quarters of the country's financial wealth. What's more, households headed by someone in the 55-to-64 age group had a median net worth of $112,048 in 2000 15 times the $7,240 reported for the under-35 age group.

Although the marketing and advertising industries still tend to target younger rather than older consumers, and men rather than women, the misperceptions underlying those prejudices are starting to break down. The assumption that consumers' loyalty is established when they are young (and that older consumers therefore are set in their ways) is bogus: consumer loyalty is not a function of age, and research by RoperASW shows that older consumers are as likely to switch brands as their children.

As for women controlling the purse strings, according to Martha Barletta, author of Marketing to Women (2003), women control or influence 80% of all purchases of both consumer and business goods and services. They have sole or joint ownership of 87% of homes and buy 61% of major home-improvement products. They account for 66% of all home-computer purchases and 80% of all health-care services. They carry 76 million credit cards, 8 million more than men.

Who's taking notice and taking advantage of these trends? The following are a few examples of companies appealing to women and seniors, taken from "Where the Bucks Are" (Fast Company, March 2004), and "Marketing Surprise: Older Consumers Buy Stuff, Too" (Wall Street Journal, 6 April 2004):

* Chico's, the hugely successful women's clothing store, catalog and web site, sells stylish clothes to boomer women that fit their bodies the way they want.

* Paine Webber (now part of UBS AG) runs a print ad featuring an older woman business owner who is also a mother.

* New Balance sneakers have five shoe widths (for older, flatter feet), and position their female product line for "the soul of the midlife woman."

* Saga, a British travel services company, recently tweaked its positioning from servicing the elderly traveler to servicing those in the over-50 crowd who prefer action-oriented travel.

* Ford Motor Co. plans to sell a sedan for empty-nesters with a trunk that holds eight golf bags.

* Sony has poured more than $25 million into advertising to make the company's camcorders, digital cameras and other high-end gadgets more appealing to people between 50 and 64, whom Sony call "zoomers."

* Walt Disney World has a web site on which customers over 50 can organize outings with golfing buddies, old schoolmates or grandchildren.

* Microsoft Corp. has started publicizing software tools with easier-to-read text, audio alerts and mouse alternatives for older workers who are developing vision, hearing and wrist problems.

* Anheuser-Busch created low-carb Michelob Ultra to appeal to the 50-plus age group, but due to its appeal to middle-age boomers, ended up creating one of its top-selling brands.

* Virgin Group is revamping some of its flagship music Megastores to include sections that appeal mostly to older listeners. In the new "mind, body and spirit" zone, there are relaxation CDs, self-help books, personal journals, yoga balls and DVDs about the Pilates exercise method.

* Proctor & Gamble Co., the consumer products marketer, has pinpointed about 30 existing products that it can market more directly to people 50 and over; work has begun on advertising plans and on a new partnership with AARP that may include joint marketing and research.

Active, affluent seniors will also transform the health care, leisure, transportation and housing industries, to name a few others. In fact, according to jupiter Media Metrix, 39% of Americans 45 and over spend more than 10 hours a week online, vs. only 25% of those 35-to-44, only 24% of those 25-to-34 and only 11% of those 25 or younger.

Growth Strategies Implications

As we wrote in "Senior Gold" (Growth Strategies #948), it would be wrong to assume that an aging society cannot be an economically growing, technologically innovative, culturally dynamic, socially vigorous society.