Distributed Marketing Management: Targeting & Reaching Baby Boomers

by | Mar 8, 2013 | Best Practices, Blog, Blog Archive, Distributed Marketing, Multi-Channel Marketing, Social Media Marketing | 0 comments

Earlier this week, the AARP announced a new effort in social media marketing, a YouTube series called “Movies For Grownups.” In the 50+ market, the AARP has significant brand awareness, which makes sense as the 50+ market is their specialty. If the AARP is making inroads in the social media space with senior marketing initiatives, I interpret this as the latest signal that the 50+ market is becoming more and more digitally aware.

There’s a lot to be impressed with from the perspective of many brands with regard to the 50+ market. Many brands that operate using the distributed marketing model are in industries that the 50+ market would be favorably inclined to, such as insurance, financial services and healthcare.

First off, consider the sheer size of this market. The Seattle Post Intelligencer noted that the 30% of the 2011 USA population would be over 50 years old. In 2013, that number has likely inched up even more, as demographic trends that led to that estimate have not abated. Futurity published news this week that Americans are living longer. That can be interpreted as good news, but the good news is tempered by the fact that the population has been experiencing more sickness, so quality of years isn’t spectacular. An aging population alone doesn’t make the USA unique. In fact, it is common knowledge that Western European nations and Japan possess aging populations as well. In some countries, it is even more dramatic than the US. Children born per woman has been decreasing in many countries over time, including the US. The overall, long term population trend is going to be more top heavy in age distribution tables, meaning that there will be more and more 50+ people as a percentage of the overall population and fewer 35 and unders. In prior times, many brands considered the 18-34 population to be the holy grail. That notion has already begun to evolve. The evolution of that thought process will become even more apparent over the next decade.

The sheer size of the 50+ market isn’t the only reason why brands are going to be allocating more resources pursuing this demographic. The primary reason that this trend will emerge more and more is because money talks. The aforementioned Seattle Post Intelligencer article also stated that 50+ Americans were expected to outspend their younger counterparts by over $1 Trillion in 2011. Marketing is only successful when market share exists through sales of a product or service. Brands need to know that there’s a target market with disposable income to spend on their offering. LIMRA (Life Insurance & Market Research Association) Retirement Research indicates  that investible retirement assets of U.S. households aged 55+ will nearly double to $22 trillion by 2020, which would be a boon to the financial services industry. Additionally, LIMRA notes that Boomers will be responsible for directing their own retirement plans.

Compare the Boomers to the generational cohort of their children, known most commonly as Generation Y or Generation X, a smaller cohort of adults commonly in between the two generations. Generation Y (approximate birth years of 1980-1994) has been disproportionately affected by recent recessionary conditions. First off, the younger you are these days, the more likely you are to be unemployed. But just having a job isn’t necessarily a panacea.  With many Generation Y era born children graduating into recession, income stats have been lower, net worth has been lower and student debt has been rising. These factors set the stage for potential lifelong financial impact. However, some statistics indicate that the recession may have just accelerated pre-existing trends. A 2012 Forbes article where Penelope Trunk (a generational expert) indicated that Generation X (approximately birth years 1965-1979) will be the first generation to earn less than their parents. This is notable because unlike Generation Y  they did not typically graduate college into the worst of post Year 2000 recessions. Many actually graduated college during the mid to late 1990s, when the economy was booming. Many of the economic factors in this paragraph are at least moderately correlated with the age distribution facts in the previous paragraph. It has been a well documented phenomenon that people don’t have as many children during times of recession and/or economic stress (this partially explains the US phenomenon of fewer births during the peak of the 1930s Great Depression and Generation X being relatively smaller due to 1970s era recessionary conditions).

What does all of this mean for brands in this distributed marketing space? Each brand will have their own approach to the phenomena, but many brands have the potential to be positively impacted.

Brands that are strongly associated with life insurance could easily benefit from this. As one ages, it can be a common approach to think more and more about death. Even if a person has fewer children, there’s still enough of a base of loved ones that a person leaves behind and often times, there is a wish for descendants to be taken care of. In many cases, this desire could be getting stronger as those in their 20s and 30s today are having a harder time forging ahead on their own. Preserving existing family assets could be a significant motivating factor now and more so in the years to come. Older populations would be more inclined to have the means to pay premiums and the mindset to perceive this product offering more favorably.

Financial services has the potential to benefit in certain ways. In financial services, there may be a shift in the marketing messaging, especially amongst local level agents. The way in which the consumer may perceive the need for financial services and allocate resources may be shifting. There may be more conservative portfolio allocation approaches, both amongst older individuals who have greater means than younger individuals (older investors tend to be more conservative in portfolio balances) and amongst some younger individuals, fearful of stock market losses. There’s been some data out there that suggests the those in their 20s now have taken some financial traits of their grandparents’ generations (the children born in the 1920s raised during the height of the Great Depression).

Healthcare brands, depending upon their space in the healthcare market, may see greater demand services given the sheer size of the 50+ market. Medical devices and pharmaceuticals, particularly in areas where the customer base tends to be older, are best positioned to succeed.

A sizable portion of mainstream brands across a wide array of industries had never really considered the 50+ market in their promotion strategies for a myriad of reasons. The primary reason is they have not been considered a profitable segment of the market, and for certain brands that may still ring true, but less so amongst brands in industries that commonly use distributed marketing models. It has been that these types of brands considered this market to be set in their ways, unlikely to be open to new brands and not extravagant spenders. They have also associated 50+ individuals as a declining market, and brands often desire to be associated with ascending or peak maturity markets. However, the Baby Boomers, poised to make up the overwhelming majority of the 50+ market in the years to come, are fundamentally different from 50+ individuals and senior citizen markets of the past. Unlike their parents, the generation that spent their formative years during the Great Depression and World War II and were significantly scarred as a result, the Baby Boomers were raised during an era of economic prosperity and are more likely to have an optimistic outlook. They are also more likely to spend money more freely than the children of the Great Depression, tying into desires of brand managers to have target markets who can afford the product/service offering. Numerous studies have indicated that the Boomers are less brand loyal than the parents’ generation, which is a doubled edged sword for brands. There are greater opportunities for customer acquisition but customer retention could be more difficult, especially in organizations that do not keenly focus in this area.

Taking all of this into account, how does a brand develop actionable items around this knowledge?

The Boomers, the majority of the 50+ market today and in forthcoming years, are more technologically savvy and becoming more and more aware. In my recent article, “Who Will You Find on a Social Network?“, I noted that 57% of 50-64 year olds use Facebook, and 35% of those 65+ use Facebook. Expect to see the number of people who use at least one social media network, even if it isn’t Facebook, to grow over the next 5-7 years for 3 reasons:

  1. People will age into new categories. People in their 40s using social media and apps will become 50+ and a lot of the late 50/early 60s users (first wave Boomers) of social media will become 65+
  2. In the technology adoption life cycle, we are near the late majority or laggard phase in social media. There’s still some growth to be had here in the 50+ market
  3. Non users of computers or mobile devices will pass away

Additionally, I believe there’s going to be a rise of 50 and 55+ individuals regularly using 2 social networks or more in the years to come. When there are more online channels, there’s more places for brands to be, creating greater complexity in the marketing ecosystem, and greater complexity calls for distributed marketing management software, particularly distributed social media marketing. One of the features of a distributed social media marketing software solution is integrated campaign scheduling, meaning that scheduling campaign posts across social networks is much easier, and can work in conjunction with other elements of a brand’s marketing communications mix, including email marketing. This ensures that a brand’s core marketing message is everywhere that their target market is. Repetition encourages brand recall, and has the potential to be correlated with positive brand beliefs, if the marketing messaging is compelling.

The size and relative financial strength of 50+ market makes them an apt target for many brands, but especially brands that operate within industries that typically use a distributed marketing model. The 50+ market is becoming more and more technologically savvy and marketers who can effectively optimize, distribute and manage content across the variety of online media channels are best positioned to reap financial benefits.