MARKETING TO BABY BOOMERS REQUIRES KNOWING WHY THEY BUY, THE BOOMER MINDSET, AND THAT BOOMERS ARE NOT ALL ALIKE

 

A baby boomer is a person who was born during the demographic post-World War II baby boom between the years 1946 and 1964, according to the U.S. Census Bureau.The term "baby boomer" is sometimes used in a cultural context. Therefore, it is impossible to achieve broad consensus of a precise definition, even within a given territory. Different groups, organizations, individuals, and scholars may have widely varying opinions on what constitutes a baby boomer, both technically and culturally. Ascribing universal attributes to a broad generation is difficult, and some observers believe that it is inherently impossible. Nonetheless, many people have attempted to determine the broad cultural similarities and historical impact of the generation, and thus the term has gained widespread popular usage.

Baby Boomers - Born between 1946 and 1964 (Click Image To Enlarge)

Baby Boomer Facts and Figures:

Size of the Boomer and Senior Markets

• 77 million people were born between 1946 and 1964, which is defined as the baby boomer era (U.S. Census).
• The first baby boomer turned 65 on January 1, 2011.
• An American turns 50 every 7 seconds—that's more than 12,500 people every day (U.S. Census).
• The senior age group is now, for the first time, the largest in terms of size and percent of the population in the U.S. This age group grew at a faster rate than the total population between 2000 and 2010, according to a 2010 Census brief.
• More people were 65 years and over in 2010 than in any previous census. Between 2000 and 2010, the population 65 years and over increased at a faster rate (15.1%) than the total U.S population (9.7%).
• By 2015, those aged 50 and older will represent 45% of the U.S. population (AARP).
• Baby Boomers make up 35% of the American adult population (Scarborough).
• By 2030, the 65-plus population will double to about 71.5 million, and by 2050 will grow to 86.7 million people (U.S. Census).
• In 2050, the number of Americans aged 65 and older is projected to be 88.5 million, more than double its projected population of 40.2 million in 2010.

Wealth of Baby Boomers and Seniors:

• The 55+ age group controls more than three-fourths of America's wealth (ICSC).
• 78 million Americans who were 50 or older as of 2001 controlled 67% of the country's wealth, or $28 trillion (U.S. Census and Federal Reserve).
• Baby Boomers control most of the net worth of American households and they account for 40% of total consumer demand.
• Boomers and seniors have seen a decrease in their median family net worth, however they still have a net worth 3x that younger generations (Economic Policy Institute).
• Boomers' median household income is 55% greater than post-Boomers and 61% more than pre-Boomers. They have an average annual disposable income of $24,000 (US Government Consumer Expenditure Survey).
• The 50+ have $2.4 trillion in annual income, which accounts for 42% of all after-tax income (U.S. Consumer Expenditure Survey).
• Adults 50 and older own 65% of the aggregate net worth of all U.S. households (U.S. Consumer Expenditure Survey).

Spending Habits of Adults 50+:

• Baby Boomers outspend other generations by an estimated $400 billion each year on consumer goods & services (US Government Consumer Expenditure Survey).
• In 2009, spending by the 116 million U.S. consumers age 50 and older was $2.9 trillion, up 45% in the past 10 years (Bureau of Labor Statistics).
• Baby Boomers account for nearly $230 billion, or 55%, of consumer packaged goods sales (Nielsen).
• In 2010, adults 45-years-old and older outspent younger adults by $1 trillion annually.
• Americans over 55 spend 50% of all vacation dollars in America (ICSC).
• 55-64 year olds outspend the average consumer in nearly every category, including: food away from home, household furnishings, entertainment, personal care, and gifts (US Government Consumer Expenditure Survey).
• Women over 50 spend $21 Billion on clothes annually (US Government Consumer Expenditure Survey).
• Baby boomers take great pride in the appearance of their homes as 27% have had landscaping done in the past year and they are 21% more likely than all American adults to have spent $10,000 or more on home improvement in the past year (Scarborough).
• The NAHB predicts that the aging in place remodeling market to be $20-$25 billion. That's about 10% of the $214 billion home improvement industry.
• 96% of baby boomers participate in word-of-mouth or viral marketing by passing product or service information on to friends (ThirdAge and JWT Boom).

Online Habits of Adults 50+:

• One-third of the 195.3 million internet users in the U.S., adults aged 50+ represent the Web's largest constituency (Jupiter Research).
• Two-thirds of Americans 50+ buy from e-retailers online (Pew).
• 89% of seniors 65+ have personal email and use it regularly (Nielsen).
• 72% of baby boomers have broadband internet in their homes (ThirdAge and JWT Boom).
• 36% of adults 50+ own a smartphone (Pew).
• 44% of smartphone owners age 50+ access the Internet or check email daily from their device (Pew).
• Adults 45+ account for 34.7% of current tablet users (comScore TabLens).
• From 2004 - 2009, the number of seniors age 65+ actively using the Internet increased more than 55% (Nielsen).
• 27.4 million people age 55 and over engaged in social networking with nearly 19 million of those people using Facebook (comScore).
• Adults 50+ spend an average of $7 billion online annually (SeniorNet).
• 72% of adults 55-63 and even 47% age 73+ shop online (Forrester).
• 41% of internet users 50-64 and 27% age 65+ say they watch videos online (Pew).
• The Internet is the most important source of information for baby boomers when they make major market purchases, such as automobiles or appliances (Zoomerang).
• 42% of all travel industry purchases happen online, and adults 50+ account for 80% of all luxury travel spending (Pew Internet and American Life Project).
• 82% of adults aged 50+ who use the Internet research health and wellness information online (Pew Internet and American Life Project).
• The top four online websites for people over 60 are Google, Facebook, Yahoo and YouTube (AARP).

In order to be effective in marketing to today's Baby Boomers and Seniors, marketer's must have a thorough understanding of how Baby Boomers buy,  the Baby Boomer mindset and know that all Baby Boomers are no alike.  Let's look at each element in this process. 

Part I - Understand Why Boomers Buy

Over the last 20-to-25 years, smart marketer's have learned a few things about how Baby Boomers buy.  Here are a few of these insights, which were published several years ago, and we think are worth sharing again. 

1. Increased individualism - Baby Boomer and senior customers are less subject to peer influence than younger customers.  Marketing Implication: Keeping up with the Joneses is not as important as it once was; thus advertising that invokes social status benefits doesn’t play as well in Baby Boomer and senior markets as in younger ones. Largely freed from worrying about reactions of others, Baby Boomer and senior customers tend toward greater practicality in buying decisions than younger customers. This increases individualization (autonomy) in behavior which makes it more difficult to predict what they will do in the marketplace.
2. Increased demand for facts - Baby Boomer and senior customers tend to be less responsive to sweeping claims in marketing messages as they age.  Marketing Implication: Hyperbole turns them off. If Baby Boomer and senior customers are interested in considering a purchase, they want unadorned facts, and more of them, than they usually wanted earlier in life. Years of buying equip Baby Boomer and senior customers with knowledge of what to look for and what information they need for an intelligent purchase. However, they often don’t get to the point of asking for facts until a product has emotionally intrigued them.
3. Increased response to emotional stimuli - Baby Boomer and senior customers tend to be quicker than younger customers to reflect emotionally a lack of interest in or negative reaction to an offered product.  Marketing Implication: Such “first impressions” are more likely to be permanent than among younger who are more likely to give a marketer a second chance. On the other hand, you can embed a positive first impression especially deep in the emotions of the older person — so much so that the Baby Boomer and senior customer is often more disposed to be a faithful customer than the younger customer.
4. Less self-oriented, more altruistic - Baby Boomer and senior customers tend to show increased response to marketing appeals reflecting altruistic values.  Marketing Implication: This tracks with common middle-age shift toward stronger spiritual values in which concern for others increases. As altruistic motivations become stronger, narcissistic and materialistic values wane in influence. Marketers to Baby Boomer and senior customers must rethink their traditional egocentric appeals in marketing communications.
5. Increased time spent in making purchase decisions - As most people grow older, they experience changes in their perceptions of time, but also in its meaning and role in their lives.  Marketing Implication: For example, Baby Boomer and senior customers often ignore time-urgency strategies in marketing — such as: “Offer good until —,” “Only three left in stock—etc…” Generally, “time is not of the essence” is a common attitude among Baby Boomer and senior customers, especially those who have retired.
6. See fewer differences between competing products - Because Baby Boomer and senior customers tend to be more highly individuated, and less influenced by external influences, perceptions of products are more internally shaped.  Marketing Implication: They typically conclude that there is really little difference between products as may marketers’ claim. This contrasts with the tendency of younger customers to assert robustly the differences between a product they prefer and its competitors — even when clear differences don’t exist. In beer tasting tests, for example, young customers often cannot distinguish their favorite brews from others. Beer marketers can influence perceptions of beer taste as much as brew masters can.
7. See more differences between competing companies - Baby Boomer and senior customers tend to be more responsive to “companies with a conscience” than younger customers.  Marketing Implication: From a self-interest perspective, they are also more attentive to warranty issues and a company’s reputation for honoring its warranties than younger customers.
8. With respect to making discretionary-purchase decisions, Baby Boomer and senior customers tend to :  1) Have a decreased sensitivity to price; 2) Increased sensitivity to affordability; 3) and, sharply increased sensitivity to value. Marketing Implication: Baby Boomer and senior customers have more complex ways of determining value than younger customers. Value determination by Baby Boomer and senior customers tends to be an existentialist exercise whereby they combine soul (spiritual) values as well as mind (intellect) and body (tangible) values into the value determination process. Not only does an item purchased symbolize some aspect of the customer’s being, the entire purchase experience can be a projection of the customer’s whole being.

For example, a person with a passionate concern for a favorite charity may more likely purchase a product from a company with a program benefiting the charity. To that customer, the product has a high Metavaluesindex; that is, an element of value unrelated to the product performance. Appraisal of Metavalues takes place mostly at subliminal levels of the mind because Metavalues tend to reflect deeply embedded, “background” emotional needs. Younger customers tend to reflect more transparent motivations. After a mature customer develops strong interest in a discretionary product purchase and determines that a brand has acceptable holistic value (basic plus Metavalues) affordability can easily become more important than price in the final decision.

The differences in customer motivations and decision processes between customers in the first and second half of life sometimes frustrate many marketers who have yet to figure out how to market to older customers. Until recently, this was not a matter of serious concern because the young dominated the marketplace. The young are easier to sell to and analyze. Now, with adults over the age of 40 in the majority, marketers are being compelled to figure out the values and behavior of older customers. 

Part II - Understand The Boomer Mindset

In order for marketer's to connect successfully with today's Baby Boomer generation, marketer's must understand a Baby Boomer's thinking process -- more specifcally, marketer's must be able to look inside the Baby Boomer mind. 

1. Motivations do not originate in the conscious mind - The conscious mind is the executive officer that, like a corporate CEO, makes decisions on needs that have been framed at lower levels. Neurologist Richard Restak states in The Brain Has a Mind of Its Own, “We have reason to doubt that full awareness of our motives may be possible.” Adds brain researcher Bernard Baars in In the Theater of the Brain, “Our inability to report intentions and expectations simply reflect the fact that they are not qualitatively conscious.”  Marketing Implication: Answers customers give researchers about their motivations are often incomplete or off the mark simply because people can only speculate about their motivations at deepest levels of the psyche. Creators of product messages need to become more intimately familiar, than is typical, with the “hidden drivers” of customers’ behavior about which they have little explicit knowledge. These drivers tend to be stage-of-life specific. For example, young people generally have stronger outer-directed motivations relating to social status than younger customers. As they age Baby Boomer and senior customer’s motivations tend to be qualitatively more experiential and less materialistic than younger people’s motivations.
2. People use different brain sites and mental processes in answering researchers’ hypothetical questions than they use in real-life situations - Research respondents tend to draw more heavily on the objective sequential reasoning of the left brain than on the subjective emotional right brain in answering researchers’ questions. This bias is reversed in favor of the right brain in reacting to product messages and making buying decisions.  Marketing Implication: We can improve research results by techniques that are more effective in defining customers’ implicit testimonies that have not been distorted by undue influence from left-brain processing. The recent trend toward studying customers in their natural living and shopping environments is justified by the finding that people process hypothetical information differently than they do real-life information. Researchers need to make more use of indirect techniques to get behind the curtains of consciousness.
3. Brain development is lifelong. How people mentally process information changes from one decade of life to the next - This alters how people view and connect with the external world (worldview). Language style preferences also change over time. For example, youth and young adults generally have a more assertive language style than Baby Boomer and senior customers.  Marketing Implication: Product messages will be more effective when expressed in the stage-of-life language style of the core market to which you primarily address the message.
4. Adolescent brains are significantly inferior to adult brains in reading facial expressions - The older people are, the more skilled they generally are at reading facial expressions.  Marketing Implication: Product messages depicting people should reflect awareness the core audience’s ability to read facial expressions. For instance, older people’s greater sensitivity to facial expressions means that facial expressions should bear authentic connection to the product and product message in Baby Boomer and senior customer markets. Younger customers will generally be more concerned with what people are doing than with what their faces are saying.
5. As midlife (40+) approaches, people increasingly draw on right-brain functions - They begin relying less on left-brain sequential reasoning and more on emotions – a.k.a., “gut feelings” or intuition.  Marketing Implication: Product messages for people over 35 should have more affect (emotional toning) than product messages for younger people. Under 35, people tend to have a stronger reasoning bias, thus product messages generally should implicitly or explicitly promote concrete reasons for purchase.
6. Information entering the brain’s cortex (outer layers) is first processed mostly in the right brain - The right brain processes information as sensory images rather than as words and numbers. The left brain works in numbers and words.  Marketing Implication: To arouse the strongest attention, product messages should be rich in sensory stimuli. Even though the right brain can’t process words, words can create sensory images, as every storyteller knows. The older a market, the more important it is to present a product in story form.
7. Emotion, not reason, is the final arbiter in decision-making - Initial responses to information entering the brain are visceral. Changes in body states (e.g., pulse, hormonal flow, saliva flow, body temperature, etc.) generate emotions. When a matter fails to generate emotions, a person will not take action on it. (Brain patients who have lost their emotional abilities while retaining full powers of comprehension and reasoning cannot make advantageous decisions in which they have a personal stake in the outcome.) Marketing Implication: A cardinal rule for developing effective product messages is go with the grain of the brain or “Lead with the right; follow with the left.” The only way to get into a person’s conscious mind is via the right brain. Again, the use of sensory images is a key to getting into the right brain.

The differences in customer motivations and decision processes between customers in the first and second half of life boggle many marketers who have yet to figure out how to market to older customers. The young are easier to analyze and sell to. Now, with adults over the age of 40 in the majority, marketers are being compelled to figure out their values and behavior. 

Part III - Understand That Baby Boomers Are Not All Alike 

 A significant pitfall is to lump all boomer and older customers into the same group. The average Baby Boomer and senior customer doesn't exist. Behaviorists have discovered that no two people see anything exactly the same way. No view we have of anything can be fully congruent with anyone else's view because, like fingerprints, every brain is unique as are the five senses that connect us to the world outside our minds. However, there are stage-of-life values and motivators shared by us all.

1. Gender tends to predispose responses to voice-overs in broadcast advertising - For example, research tells us that male voices are more knowledgeable when describing technical attributes of a product, while female voices are more knowledgeable when describing a product with references to love, relationships and caring. Marketing Implication: Choose the voice to match the content and delivery style of a product message.
2. Pictures of people in motion arouse the brain more quickly than posed pictures - Marketing Implication: Avoid posed pictures like the plague. Motion conveys vitality. Posed pictures convey lifelessness. You should mostly avoid posed pictures in marketing to Baby Boomer and senior customers, although marketers commonly use posed pictures for that market.
3. Each experience we have prompts the brain to create clusters of neurons (brain cells) with predisposed responses to new but similar experiences - As the population of these dispositional clusters increases, a person becomes more habituated and reflexive in his or her responses. This decreases sensitivity to external influences, like advertising, making a person more autonomous.  Marketing Implication: Dispositional clusters are the marketer’s equivalent of “hot buttons.” The older we are the more hot buttons we have. This is good news and bad news for marketers. First the bad news: It’s harder to change people’s patterns after the early adult years. Now, the good news: When a marketer hits a customer’s hot buttons, the deal is all but made. The challenge is learning what those hot buttons are. Fortunately, there is remarkable consistency in the general nature of hot buttons among people in the same season of life. Knowledge of the developmental attributes of customers in a given season will guide a marketer to connect with their hot buttons.
4. Initial determination of information relevance occurs unconsciously - When a person sees an ad, or a TV spot the right brain initially determines if it has personal relevance. The sequential reasoning processes of the left-brain only go to work on the ad after it has reached consciousness. The right brain conducts a process called information triage to reduce information flow to levels the conscious mind, with limited working memory (RAM) can handle. The primary criterion is relevance to a person’s interests. Marketing Implication: Imagine having a conversation in your office or at a social gathering when you hear your name come up in another conversation not far from you. Your brain was hearing the other conversation all along, but only when your name was mentioned did it see fit to alert your conscious mind to the other conversation. That’s what information triage is about. Creating product messages that survive information triage is the biggest challenge in marketing. It has become fashionable to complain about advertising clutter. However, the clutter problem is in the brain, not on a television screen or in a magazine. When a message has relevance to a person’s interest, the right brain will take note. When we talk about having a “double take,” we acknowledge the right brain’s ability to pick up in a nanosecond something that has relevance to our interests.
5. Increased price-sensitivity in nondiscretionary spending - As they age, many customers develop higher economic “literacy” and skillfully apply it to get the best price — an objective not to be confused with “getting the best value”.  Marketing Implication: Bargains primarily reflect price factors while implicit in the term “value” are all attributes of the product, the purchase experience and the expected ownership experience. In purchasing “need” items, Baby Boomer and senior customers tend to be more bargain-minded, whereas in purchasing “desire” items, they tend to be more value-minded in a holistic sense.
6. Often project what seems to be contradictory behavior - We sometimes characterize Baby Boomer and senior customers as selfish and selfless, penurious and profligate, spontaneous and deliberate, and so on. These conflicting attributes lead some to characterize Baby Boomer and senior customers as contradictory — or at least, confusing in their behavior.  Marketing Implication: However, Baby Boomer and senior customers are not contradictory in their behavior; they are sensitive to context in their behavior. For example, a Baby Boomer and senior shopper may appear needy in using cents-off coupons in a grocery store, after which she drives off in a Mercedes. This is not evidence of contradictory behavior, but an example of the rules of thriftiness applied to basics, and the rules of whole value applied to discretionary expenditures. In the first case, price is the common denominator in customers’ interest, in the second, there is no common denominator because each person calculates whole value in a unique manner.

We’ve learned that it’s about new rules, new mindsets and new processes. In short, it is about a new, authentically customer centric paradigm. New paradigms challenge the mind because the mind has a natural bias toward preserving the old ways; even when old ways cease working as they once did. But when pain caused by an old paradigm’s breakdown exceeds peoples’ threshold of tolerance, they begin warming to new alternatives.

Finally, we’ve learned that today’s marketplace is unlike any before faced before. Most of its adult members are in the years when the influences of what Maslow called self-actualization begin to show up in behavior. Until the New Customer Majority emerged, these forces had little noticeable influence on the marketplace at-large. Now however, such attributes of self-actualization oriented behavior as the following are widely evidenced in the marketplace:

• Perceptions – more conditional, less absolutist (shades of gray vs. black and white)
• Relationships– more autonomous, less dependent on sources (such as advertising) in making decisions
• Social behavior – more individuated, less subject to “herd behavior,” less easy to pigeon hole into segments
• Decision making – moreemotional (as in “gut feelings” or intuition), less “rational” in decision processes.

Courtesy of an article dated January 7, 2013 appearing in MediaPost Publications Engage:Boomers, an article dated February 4, 2013 appearing in MediaPost Publications Engage:Boomers, an article dated March 4, 2013 appearing in MediaPost Publications Engage:Boomers, and an article appearing in ImmersionActive