Baby Boomers are Spending: Enough about Millennials, by Lester Lam
Talk to any ad agency, market research firm or consultancy today, and they’ll offer an opinion on what Millennials want. Millennials have captured the collective imagination of corporations, marketers, media, online pundits, and frankly, Millennials themselves. Everyone is talking about them as the Next Big Baby Boom.
But what about the original Baby Boomers? They’re still here.
Through our studies of the everyday lives, we see that Boomers still offer a huge opportunity for smart companies that understand them.
Baby Boomers number 77 million in the US alone. They’re the wealthiest generation in history, owning roughly 70% percent of the wealth in the United States and set to inherit $15 trillion in the next 20 years. Not surprisingly then, they spend more than any other demographic in an astonishing 94% of consumer goods categories, accounting for 50 percent of all dollars spent on consumer goods in the United States. Despite this purchasing power, marketing to them has fallen out of style: most marketers today are more focused on selling them anti-incontinence products than the next premium car. Stereotypical images of retirees as passive, technophobes with little to spend, seems to be keeping companies from seeing how Baby Boomers are currently redefining what aging means.
So what is it that Baby Boomers really want in later life? And how can you successfully target them?
Getting Baby Boomers right
ReD Associates conducted an in-depth study that revealed a more intimate and nuanced understanding of the everyday lives of Boomers. Research showed that the “me” generation’s earlier interests in boundary pushing and self-discovery have mellowed. Today’s Boomers want to enjoy the fruits of their labor, stay socially engaged — both online and off — and redefine old age as a phase of adventure, discovery and self-acceptance. As one Boomer told us: “You have to relax — that’s what happens in middle age … It’s about independence and being free. Being free of thinking I have to be something or somebody else.” It is not about being old.
In our research, we discovered a common outlook across all members of this generation. They feel optimistic about a longer, healthier life with more freedom for travel and self-actualization than previous generations. They also have less to prove. Unlike Millennials, who are easily influenced by trends, Boomers don’t need the next, big “shiny thing”. They want offerings that actually suit their own lifestyle and genuinely enhance their individual experiences.
This individuality can also be seen in the way Boomers engage with technology. Most of them are online and eager for digital apps and platforms but our studies reveal that they build online personas and digital profiles in unique ways. Some balance seeking out reviews and information online with recommendations from experts in person; others use digital platforms to replicate their social lives online; still others take a functional angle on digital and social platforms, using them for narrow professional and personal roles.
Based on the depth of our understanding with this generation, we’ve compiled a list of dos and don’ts to show what marketers should do — and what they should avoid — to effectively reach today’s most lucrative consumer segment.
The do’s and don’ts of marketing to Baby Boomers in a digital age
- Disregard them: Boomers have gotten used to being the center of attention over a lifetime of marketing; don’t make them feel left out.
- Tell them how old they are: One finance customer we met described a premature letter about his retirement at the early age of 59 as “a kick in the stomach.” Boomers are looking for ways to enjoy the new freedoms of this life stage. They don’t want constant reminders that this life stage will end.
- Pitch nostalgia: The 60s and 70s were great. The 80s were bright. But to most Boomers, 2020 looks even better. The future is full of opportunities for Boomers, freed from the limitations of yesteryear. Find new ways for them to enjoy the future instead of asking them to reflect on the ‘good ol’ days.’
- Write off their tech savvy: Boomers are steeped in technology. They buy more of it than any other demographic and account for as much as 41% of all Apple purchases; they even use their phones more at dinner than any other generation. Ask how they use technology, not whether they do.
Taking the right steps is trickier. It requires understanding the precise needs of the Boomers you want to target and the core motivations and lifestyles they want to achieve. Nevertheless, across our studies and in our experience with clients, we can point to some key principles for success.
- Personalize for Boomers –Boomers have different hobbies and values and have built a unique, stable sense of who they are, what they like, and how they like it — much more so than trend-driven Millennials. This means that they value good service. Try to understand past purchases, life experiences and sales interactions, many of which have occurred offline, to show them that you’re paying attention to their needs.
- Keep Boomers relevant — Boomers already have what they need including favorite brands for everything — drinks, phones, cars — but they are looking for new ways to experience things and share them, both in digital and analog. They’re even willing to pay for these experiences. Whether it’s expanding their knowledge of whiskeys, joining a fashion meet-up, or discussing cars online, find new ways to connect your offerings to the social worlds Boomers want to stay engaged in.
- Make the future brighter — Boomers are well aware of what may come; they have heard it from doctors, parents, and financial advisors for years, and now they’re living it. They want to enjoy their freedom, not lament it. Show them new ways to take advantage of the freedom and put them in touch with people their age still having an impact.
- Speak to quality –Boomers are discerning consumers who know what they want. Appeal to them with products where they can feel, see and taste the difference, and offer them expertise to assure them it’s the right choice. Contrary to popular opinion, Boomers will not hold back on spending if they trust in the quality of the product.
- Find new touch points in their lives — Boomers are high tech, but they also appreciate dealing with real people either in stores or on the phone with customer service. Explore how to give them choices about the service experience they are seeking.
Millennials may still top your news feed, but Baby Boomers are in your stores, buying from your websites, reading about products online and using your apps. Don’t be distracted by the constant quest for the Millennial dollars. Understanding how to connect with Boomers is essential for maintaining your business today — and for growing it into the future. The business around Baby Boomers is very much still booming.
Want to know more? Cognizant and ReD Associates have formed a strategic partnership to help businesses integrate human sciences, design, and technologies to win in the market. This article was co-authored by Filip Lau, one of the founding partners at ReD Associates, and Lester Lam, vice president of strategy for Cognizant Digital Works. Thanks to Ian Dull, senior consultant at ReD, and Irene Sandler, AVP at Cognizant, for their contributions.
Opinions expressed in this blog are of the author and may not represent Cognizant’s point of view.
Lester is Vice President and Global Leader for Cognizant Digital Works Strategy Consulting. As one of the founders of Cognizant Digital Works,…
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Originally published at digitally.cognizant.com on August 31, 2016.