Selling to seniors.

Marketing to the mature consumer, particularly those over 65 years old, requires unique marketing strategies. Without those strategies, many companies spend millions of dollars on programs that are ineffective.

There is a way, however, to reach this highly segmented market by first understanding

Seniors build their buying blocks from life experiences and product knowledge: These barriers to buying - which become more entrenched over their lifetime - guide mature customers when they make purchases.

Here's a simple analogy to illustrate how seniors view the prospect of changing products. Seniors are like new homeowners. They are proud of their house and are prepared to live in it for the rest of their lives. They believe that they are protected and begin to feel comfortable in their surroundings. Only for lifestyle or need-driven reasons will they decide to move again. Similarly, once seniors have selected a product, they are unlikely to change it for a different one.

Brand Loyalty is Not a Barrier

To begin breaking down seniors' buying blocks, marketers must first throw out the misconception that seniors are loyal to brands. Seniors do favor some brands, but so do we all. And while their buying patterns sometimes are slower and their loyalty longer lasting, they will switch products under the right circumstances. Carol Morgan and Doran Levy, in their study Segmenting the Mature Market, find that the determining factor of whether seniors will switch products is attitude. Another study shows that 75 percent of seniors will experiment with new products, and if their attitude is changed they will switch brands.

George Moschis finds similar results about product loyalty in his book, Marketing to Older Consumers. He examines how the mature consumer selects and purchases products, and concludes that seniors are not brand loyal. Moschis finds there are several ways to motivate seniors to purchase; and that "new product adoption may in fact be situation - or market subsegment - specific."

Seniors' Blocks to Buying

Other investigators have taken this idea one step further by not only studying what prevents seniors from buying, but what marketers can do to break down these buying blocks.

Dale Lunsford and Melissa Burnett, in Marketing Product Innovations to the Elderly: Understanding the Barriers to Adoption, focus on five buying blocks that prevent seniors from purchasing new products. These blocks are the result of several factors, including situational influences, individual characteristics, product characteristics, and the perceived risk by the consumer.

Unusable Products

Physical limitations prevent many seniors from using some products. For example, because of diminished strength, seniors struggle to open doors, sit on chairs and maneuver walkers and wheelchairs. Because of diminished eyesight, some seniors have difficulty reading small type in advertisements, brochures and contracts.

Seniors' physical limitations must be considered when designing new products and services meant for seniors. Be sure your branch is easy to enter and to navigate. Make sure your marketing materials are easy to read, and make sure the type size is slightly larger on your forms and applications.

Vague Benefits

When considering a new product, seniors ask questions such as, "What is the benefit of the product?" "Is this better than what I already have?" and "Will it help me now, or can I do without it?" For example, seniors view value as a benefit, but a product that saves time is of little interest. Value for seniors comes in the form of high-quality, low-risk, reliable and easy-to-use products.

Here's another example. For many seniors, telephone answering machines are of no interest because they don't present a clear benefit. Many seniors are not concerned about missing phone calls. But some seniors place a high value on services that are viewed to be safe and convenient, including using the telephone for electronic fund transfers. Be sure to communicate clearly the benefits of your products and services. Spend time learning what benefits your market is looking for.

Unflattering Images

Although seniors may be chronologically "older," they don't think of themselves as old. They believe that someone else uses those products meant for "old people" - not them. Studies show that seniors perceive themselves to be 10 to 15 years younger than they actually are. Marketers must take into account this "cognitive age," rather than focusing on seniors' chronological age.

Closed-caption television and videotex languished because seniors perceived them for use by "old people." However, this group is highly segmented. Some seniors may feel and act older, may be incapacitated or may have other negative self-images. Therefore, to be effective, marketers must first identify which senior segment they are addressing.

Conflicting Values

Seniors who were being shaped during the Great Depression and World War II form a "cohort." They were imprinted with certain values during critical periods of their lives - their late teens and early twenties - such as being thrifty, honest and loyal. Many senior consumers base their current buying decisions on these values.

Geoffrey Meredith and Charles Schewe are exploring the "cohort effect." They define the "cohort effect" as the core values formed by the experience individuals have while nearing adulthood and being exposed to both personal and social interactions. Because many individuals were affected in similar ways during these times, their values and behaviors are generally similar.

Meredith and Schewe find that seniors' taste in music, money management choices and food preferences were shaped because of such imprinting. For instance, seniors growing up between the 1930 and 1940 formed an appreciation of big band music, a concern about savings accounts and a taste for home cooking.

Physical, Economic and Functional Risks

Seniors take their time choosing a product or service. There are three potential risks involved - physical, economic and functional. Certain products involve physical risks such as drugs. Economic concerns involve most higher-priced objects, including reverse mortgages, new cars and furniture. Functional risks occur when seniors try to understand how new products work, which includes investment options as well as VCRs or cordless telephones.

If the perceived risks are overwhelming, seniors will refuse to purchase. Lunsford and Burnett describe this refusal as the "omission error." When left unsure, they say, "the elderly will neither act nor make a decision."

Below are questions that should be asked by marketers, designers, advertisers and others aiming new products toward the seniors market:

* Can we show the product's best features - without exaggeration?

* Can we design a marketing campaign in which seniors accept the product image?

* Can we prove to seniors the product's clear benefits?

* Can we position the product with something that helps seniors associate with it - such as something old, or familiar, or related? * Can we avoid negative images and stereotypes by focusing on seniors in a positive light?

* Can we promote - as the major appeal of this product - good, honest value?

* Can we segment the senior market?

* Can we tailor an ad campaign so that seniors easily can compare similar products with my product?

* Can we design an ad campaign accentuating the personal features of the product or service, the bank, and the sales personnel?

* Can we design a campaign to attract the seniors' children and grandchildren?

* Can we appeal to my segment of seniors without highlighting them negatively and without accentuating their shortcomings? * Can we demonstrate how to sell the product to seniors on a trial basis?

After asking these questions, those marketing to seniors must look at how to begin breaking down seniors' resistance to purchasing. Here are twelve categories marketer should consider.

1. Design Intergenerational Products

If the product is specifically for seniors, then it may be best to market it as an intergenerational product - ones that can be used by grandmother, mother and daughter. Avoid the hard sell approach. Keep the focus of the product on all adults and not just on the mature consumer. Seniors think little of anyone catering to their limitations directly. Generally if it is good for seniors, it is good for all consumers - such as larger print in promotional materials and product contracts for easy readability.

2. Sell Value

Seniors refuse to buy products just because they are new, in style or expensive. They were raised to respect value and, if the "cohort effect" is in place; they have been guided by this type of consumerism for many years. David Wolfe in Serving the Ageless Market points out that, different from baby boomers, seniors are past the "acquisition stage" of their lives. They are finished with wanting mere possessions. Perhaps just as important,seniors look for pleasurable interactions while at the store or the bank. They look for good customer service, from salespeople and tellers. Advertisers can highlight this aspect when preparing commercials and ads for this market.

3. Communicate Through Their Children And Grandchildren

For many seniors, social interaction is limited to their immediate family. And through these family members seniors may receive new products that they otherwise would not have bought for themselves. Many children today are serving as caregivers for their parents. As a result, many children are managing their parents' assets. This is an opportunity to introduce new products to the mature market.

4. Segment the Senior Market

There are 64 million seniors over the age of 50 who are targets that marketers cannot reach completely. Why? Because this group probably is one of the most diverse markets in history. These seniors, as one may expect, have different attitudes, lifestyles and roles. Their health, finances and circumstances make them a varied but unique group. What appeals to one cluster may have little interest to another.

A survey by P.F. Bone, Identifying Mature Segments, revealed that from 32 recent studies of senior segmentation, five variables emerged as most important. They included activity level, discretionary time, discretionary income, health and response to others. To help segment this market even further, it's important to examine several other studies to include responses that relate to ethnicity and gender. While it is impossible to try and address all these issues, a certain amount of segmentation is imperative.

5. Picture Positive Roles

Seniors already know if something is wrong with them and they don't appreciate being reminded of their limitations. Actually, most older Americans still enjoy life and want to live it actively and positively. They try products and services that show them how best to achieve these goals. Conversely, they walk away from situations reflecting little of these values.

Mature consumers don't appreciate the stereotypes depicted of them by advertisers such as the clucking sisters from the Denny's restaurant commercial and the Wendy's restaurant "Where's the beep." blunder. Denny's still is suffering from their depiction of two aging sisters, one that repeatedly mispronounces the name of the restaurant. Wendy's was fortunate to have Dave Thomas help them to overcome the "Where's the beef.?" campaign.

6. Create Product Images with Senior Appeal

Design marketing-programs consistent with senior values. Forget the values of the baby boomer generation; seniors are different.

Learn the values held by seniors by examining the "cohort" studies and segmentation forms and by holding focus groups.

It's clear that newness is of slight interest when considering purchases. And while 60 percent of baby boomers would rather spend than save money, 70 percent of seniors would rather save than spend. All products marketed to seniors should reflect their sensitivities.

7. Create Reasonable Expectations

Many seniors have been burned before and are quick to suspect that it might happen again. If after careful examination a new product or service fails to reach or exceed the anticipated result, seniors usually reject it. As if this isn't bad enough, they also like to share these experiences with their friends.

8. Make Product Comparisons Easier

When seniors become overwhelmed from comparing products, they stop. Many think there should be easier ways to buy a product - and there are. Marketers can improve the point-of-purchase displays, and offer toll-free numbers for clarification. Offer helpful media advertisements with easy comparisons and standard formats. Use the appropriate medium. Print is preferred because seniors can refer to the information later and process it at their own pace.

9. Make the Product Familiar

By linking old concepts to new technologies, marketers can help seniors relate to a new product. Seniors are better able to connect to new product ads that are positioned alongside old ones or past situations. By relating a new product to something old, seniors can process the information more quickly and can associate this information with something already familiar to them. An example is marketing a loan at "old-fashioned" rates.

10. See Seniors as Friends, Not Just Customers

Remember that many seniors view banking and shopping as social events and often do these activities at a leisurely pace. To improve seniors' experience, the sales staff might benefit from seniors sensitivity training, which addresses how best to deal with these special customers. Employees should understand that they must avoid using a patronizing tone, put on friendly faces, refrain from using depressing words, and speak clearly and distinctly. The single most important reason seniors stay away from a particular bank or store is the treatment they receive from the sales personnel.

11. Sell Needs, Forget Newness: Show Benefits of the Product

Seniors need to see why they should replace their "old" or "existing" products with something "new." What works best are clear comparisons of a product made by a sociable salesperson in a leisurely, comfortable atmosphere. What's seen as convenient and helpful for one generation isn't necessarily seen that way by seniors. A son in his 50s might think a cordless phone would make life easier for his aging parents because they have trouble getting up to answer it. However, the parents may perceive the cordless phone as unnecessary because missing phone calls is of little importance to them.

A daughter in her 40s might think 24-hour ATM banking would be a convenience for her parents, but they may prefer to go to the bank in the middle of the day during the week and talk with a personal banker or teller.

12. Sell on a Trial Basis

Seniors avoid high risks of trying new products. It is essential to promote a product as risk-free as possible. Sell the trial. Warranties, guarantees, money-back returns, demonstrations at community trade shows, free trials at hospitals and senior residential centers - all can be used for breaking down the risk factor for using the new product.

The ideas presented in this article, when applied, will enable marketers and advertisers to communicate and sell new and exciting products and services more effectively to the senior market.

Frank Conaway, president of Primelife, is an expert on marketing to the mature market. Primelife, based in Orange, Calif., offers consulting services, seminars, sensitivity training, marketing, and proprietary research (PLAN). For more information, call (714) 744-1291.

For a list of the six sources cited in this article, please call Jennifer Porter at (800) 433-9013 or fax your request to Jennifer Porter at (202) 828-4540.