Over the past half-decade or so, Millennials – generally speaking, those consumers born between 1980 and 1995 – have become the focus of marketing pundits for their new attitudes and behaviors towards brands, which are profoundly different from their parents. The argument goes that Millennials’ seemingly innate connectivity and compulsion to find a better way influence brands and markets well beyond their relatively-limited purchasing power. Agencies, strategists, and consultants (present company included), will quickly point out that this large group of multicultural “digital natives” learn about brands, shop for them, and advocate on their behalf in ways that earlier generations never dreamed of. While this profile is generally accurate, a narrow focus on Millennial consumers poses a new danger: the risk that brand managers (some of them older Millennials themselves) lose site of those older consumers who still greatly influence their markets.
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Demographics, to be clear, are not the only ways to segment your consumer landscape; nor is any generation homogenous and neatly summed up in a PowerPoint presentation. Still, as a first cut, it is useful to understand how tastes and actions shift over time so that brands can evolve and stay relevant in the marketplace. There are too many examples of brands that failed to evolve as they watched their business steadily erode. So, we can all agree that it is critical to understand emerging trends, burgeoning tastes, and new habits that will shape the markets we compete in. This fact does not absolve us, however, from the responsibility to understand our long-standing loyal consumers as they age.
Baby Boomers and, to a lesser extent, Generation-Xers are becoming less fashionable prime prospects. In certain industries, it is important to appeal to young consumers, but in many (if not most) CPG categories consumers in their 40s and up remain incredibly lucrative and influential targets. United States demographics show that people are starting families later than they did in the past, making 40-year old empty nesters a rare breed. Perhaps ironically, so many Millennials are out of work that they too are living at home with their parents. However convenient an advertising target “Moms 25-39” once might have been, today it is even less relevant.
Not only are households older than in the past, but Gen-Xers and Boomers possess enormous purchasing power. Boomers, in particular, who are working later into life than their parents, generate spending levels that far overshadow Millennials. This difference doesn’t just drive up the basket size, but it puts less incentive to buy on deal, spend on store brands, or find creative ways to reduce consumption. As every smart marketer knows, a loyal consumer is much more valuable than a new one.
Marketers often cite Millennials’ widespread and constant use of social media as a key difference versus old generations. In fact, it is true – no generation is as connected. But the stereotypic image of grandma bewildered by her dial-up AOL account is really overdone. Boomers and Gen-Xers are active on Facebook and Pinterest, shopping, researching and sharing online by the tens of millions. The world is connected; it isn’t the sole purview of those born before 2000.
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In reality, Boomers and Gen-Xers remain some of the most valued consumers in terms of dollars spent, basket size, brand loyalty, and their involvement with brands in social networks. Brand managers will do well to make these valued consumers continue to feel welcome and at home with their brands. Increasingly that means making the shelf simple to navigate, making products easy to shop, open and reseal (especially for seniors), and to reinforce those familiar brand equities that built the franchise in the first place – even as the brand evolves and attracts the next generation of consumers.
The risk in not doing these things is that older consumers will break their loyalty to brands that fail to treat them well and will seek out those brands that do. It wouldn’t be out of character – and might be slightly poetic – for Boomers to rally for social change one more time.
Image: Jeff Sheldon