With all the possible target markets out there, why would anyone want to market to seniors, anyway?
Thought of by some as a «lost cause,» they are labeled as too old, too disabled, too oblivious or too frugal. While those monikers may apply in some cases, it is astonishing how wrong those perceptions are when you examine the reality of today’s buying public despite a sour economy, a real estate crisis and unemployment at its worst level in decades.
Suddenly, seniors are looking mighty appealing to some, if not all, marketers because of a few major facts:
Misconception #1: Senior citizens are in the minority
Fact: 76 million baby boomers in the United States are now turning 65, a fact which is putting senior citizens in the majority. According to a Feb 6, 2011 New York Times article on the business of aging, these new senior citizens are different from previous generations, anticipating a life expectancy that is longer than in the past – a period of at least another twenty years. Worldwide, the segment of the population 65 and older will more than double, from 523 million to 1.5 billion by the year 2050, according to estimates from the United Nations. The US Census Bureau reports that there are more females than males nationwide with the Northeast in the lead for that distinction, as well as for having the largest percentage of people in the age group 65 and over. Although more people will be postponing their retirement in the interest of maintaining a sustainable income, those who choose to retire will have lots of time on their hands for which the only salvation is to keep busy. And extrapolating truth from reality, keeping busy means that senior citizens will comprise one of the country’s largest markets, too expansive to ignore and certainly too available to dismiss.
Misconception #2: Senior citizens are too old, technologically challenged and computer phobic
Fact: With «senior citizen» defined as someone who has reached old age, (yet, to the amusement of this writer, still described as «ancient» in some dictionaries), the bulk of baby boomers will be a relatively young group (age 65-74) until the year 2034. That’s a good twenty years of time in which marketers can benefit. Baby boomers are not some wall flowers intimidated by the prospect of stepping out to dance. Indeed, these are our gadget-savvy, forward-thinking, mature and experienced, movers and shakers who have been big participants in, if not initiators of, today’s technologically advanced style of life for most of their existence. Hardly prone to dropping out of society, these are connected individuals aware of the ramifications of social media and Google rankings, alternately engaged and irritated by the entourage of political missteps and world events, and influenced by the fallout from job loss and home foreclosure. These are acutely aware consumers of the most formidable stature.
Misconception #3: Senior citizens are too «cheap» to spend any money
Fact: Seniors are today’s biggest spenders. According to estimates based on a consumer expenditure survey conducted by the Bureau of Labor Statistics, in 2009 about $2.6 trillion was spent by baby boomer households in the United States. That’s up 45% year over year as measured by a Gallup poll cited in a June 10, 2010 New York Times article by Catherine Rampell, entitled «Who’s Spending Again? The Rich and the Old.»
While it is true that seniors tend to be more conservative in their tastes and frugal in their choices, it is also true that their habits of spending are greatly affected by the wants and needs of those important to them: their children, grandchildren, and great grandchildren. If, for instance, the son of a senior citizen has lost his job and can no longer support his family to the level of comfort they once enjoyed, far be it from grandma to watch them suffer. Many older Americans have welcomed the younger generations back into their homes and are now spending liberally to keep them fat and happy, so to speak.
But there is another reason why seniors have relaxed the tight reins on their often extra-large nest eggs. Recent stock market gains have a psychological impact on the mindset of retired people with investments, even if those investments are bond- or annuity-based, leading them to the conclusion that they are wealthier. Add this feeling to the rationale that seniors may feel that life is too short and now is the time to splurge before it is too late. Bolstered by years of moderately successful finances now enhanced by the tenuous fruits of social security benefits, some of these seniors enjoy significant means and plan to experience life’s luxuries before time runs out.
What does that mean? It means vacations, cruises, luxury vehicles, and home entertainment purchases. It means shopping for apparel, jewelry and gifts for the kids. It means spending on hair and nails and plastic surgery and a new smile. It means dining out and going out for an evening of pleasure. All on a regular basis. Once they get started, it’s hard to stop.
Misconception #4: Senior citizens have no brand loyalty
Fact: Seniors demonstrate brand loyalty much more than members of today’s younger generations who tend to be fickle, flitting from one thing to another at the drop of a hat. While fads, trends, and social influences lure youth from one product to the next, seniors are considered more valuable as customers, according to a September 26, 2007 New York Times article by Matt Richtel on «Sticky Old People.» A senior will take time to assess a decision carefully and will stick with that commitment longer as a general rule.
Although seniors have a lifetime of experience to draw from, a wealth of knowledge about a whole range of topics, and valuable skills representing a variety of careers, such wisdom is viewed with some reservation in today’s rapidly changing world. First, old age tends to bring on forgetfulness and memory loss. Second, when it comes to availability of knowledge, Google provides answers to everything and anything in a matter of milliseconds, hardly a level playing field for a senior citizen (or anyone for that matter), regardless of how smart or accomplished they may be. Finally, the skills seniors have mastered tend to be for things we no longer need or use, like yesterday’s engines or obsolete entertainment hardware, for example, now replaced by wireless computer technology of the most advanced level. Even if seniors have kept up with every technological development through the years, their motivation for keeping abreast of such changes once retired lessens greatly, as does their capacity for retention. A younger person has the edge here.
Misconception #5: Senior citizens won’t buy anything unless there is a discount
Fact: If there is one thing which seniors totally dominate, it is the healthcare market, discount or no discount. No one purchases more health-related products than senior citizens, making them easily the most valuable market for businesses in that industry, bar none. Old age, by nature, brings on difficulties with balance, dexterity, autonomy and mobility, as well as sensory maintenance and retention. Some of these conditions encourage social withdrawal. The industries that cater to protecting seniors from physical and psychological demise can only expect to reap the rewards of their manufacturing and marketing acumen. Yet, it is evident that the prospect of investing heavily into the development of products which can serve such purposes is conjuring up trepidation within companies poised to benefit. The reason for that is that the senior market is yet unproven territory, having not shown that it will buy into new technologies which preserve health and well-being even if there is a dire need for it. Rather, companies like Ford Motor, which has a hands-free, parallel parking system which eases the need to strain one’s neck (a common pitfall of aging), coupled with blind-spot detection and a voice-activated audio system, take solace in their ability to market to a broad-based market, not just targeting the mysterious seniors for product success.
During the writing of this article, I was coincidentally contacted by a local non-profit «Aging in Place» organization who claimed they needed a marketing plan to facilitate an increase in paid membership. Aging in Place is a concept used by national senior citizen groups to describe efforts to help older adults remain in their own homes for as long as possible, while receiving assistance from a variety of outside services, if needed, to find solutions for any inconvenience or problem confronted. This could include help with medical, social, financial or nutritional needs, to name a few.
At the same time, many of the real estate development companies nationwide have embraced the idea that constructing senior-appropriate residential or retirement centers which incorporate new technologies to monitor the health and safety of its residents, as well as on-site social, dining, entertainment, fitness and physical therapy areas, are a safe bet for senior marketing.
Certainly either scenario makes sense as long as all marketers address the age-old question: what is the best way to reach senior citizens? Or, is the question instead, how to reach the adult children of senior citizens? While the choices remain the same as when trying to reach the total market, all of which are expensive when an unknown response rate is always possible, there are ways to target seniors with some intuitive reasoning. Think old-fashioned if you want an older demographic; think creatively to reach the newly inducted «younger» baby boomer senior or his adult children. Among a whole array of strategies, old-fashioned means advertising in the daily newspaper; on conservative talk radio programs; or sponsorship marketing and live presentations with handouts at senior fairs and events at community or religious centers. Creative marketing may mean using the Internet to reach the more tech-savvy senior through an email campaign; or sponsored ads to accompany appropriate Google searches, to barely touch the tip of the iceberg of possibilities. Probably the safest route to any age senior is through his postal address, lists of which can be purchased through age selection plus a gamut of other parameters which may be appropriate.
And as with any marketing, one effort may not be enough. A diversified approach as well as multiple attempts are usually what spell a more successful outcome, being vigilant to measure response throughout every step of the process. But keep one thing in mind. Seniors have become victims of scams more often than we care to admit. While some may still be helplessly vulnerable, others have become even more wary, distrustful of every marketing offer they encounter!