PL Buyer: Setting Your Sights on Seniors
By Randy Hofbauer
Through a special
arrangement, what follows is a summary of a current article from Private
Label Buyer, presented here for discussion.
Retailers, start your engines. As baby
boomers begin to reach the age of retirement, the population of seniors is
expected to swell dramatically.
According to a Jan. 24, 2010, article
in U.S. News & World Report, the U.S. Census Bureau forecasts
that the 65-and-over population will increase from 38.7 million in 2008 to
88.5 million by 2050. During the same span of time, the 85-and-over population
is expected to grow from 5.4 million to 19 million.
The article goes on to say that these
days, seniors have more of a reason than ever to look forward to their “golden
years.”
Marc Narine, vice president of marketing
at National Blends — a manufacturer of skincare products — says his company
views the term “senior” in a different way than some companies viewed it
in years past.
“The persons that this term refers
to, as our company sees it, are on Facebook, are buying airline tickets online,
have a particular preference in search engines and are active — and eager
to stay so,” he says. “As a result, they are taking the time to invest in
their health and actively seeking the information and products that yield
dividends on that investment.”
On the skincare side, Mr. Narine says
National Blends manufactures several products that cater to the needs of
the modern senior. The products contain probiotics, antioxidants and other
supplements to help boost the body’s immune system, treat skin conditions
and rebuild skin cells.
“It’s important that you understand
your consumer,” he says, “what their ‘pains’ are and what ‘fixes’ they seek,
then invest time and money into the relevant channels.”
Obviously, packaging must communicate
the “fixes” a product offers to seniors.
The same packaging attributes work
well in many other senior-focused categories. Rob Lippucci, product marketing
manager at Hospital Specialty Company (Hospeco), Cleveland, says it is important
that retailers print clean, clear and concise descriptors on packaging for
their adult incontinence products.
Easy-to-read packaging helps seniors locate the right product, learn how to
use the product and feel comfortable with their purchase decision.
Still, even with the right products,
retailers need to make sure they employ the right merchandising strategies.
Lippucci says that when it comes to incontinence products, consumers respond
most to print and in-store product promotions.
“Most consumers in this group still
check the weekly circulars for sales and special offers,” he says.
But Mr. Lippucci doesn’t believe retailers
should invest all of their promotional efforts into such traditional areas
— the senior demographic is becoming increasingly tech-savvy, and tools such
as Facebook and Twitter are becoming ever more relevant to seniors.
“It is likely as the baby boomers age,
the internet and social media will become increasingly important tools to
reach the consumers,” he says. “It is becoming increasingly important to
have a product presence on the retailer’s web site for those customers that
search for products or information online.”
Discussion Questions:
What common assumptions about selling to Baby Boomers are spot on or
dead wrong? Is there a corresponding challenge and opportunity
with Boomers that retailers need to address to be successful with them?
LOL! Easy to read packaging is necessary but not sufficient. Easy to open packaging is necessary.
Have you ever watched someone who is “older” or who has arthritis try to open something as simple as a salty snack? Now imagine or watch the process for a health or beauty aid product in a clam shell, or mummified in cellophane?
I believe that many marketers who are not of a certain age think that if they position a product for the “aging” it will be snapped up. Note, the same positioning, especially in health and beauty aids is directed toward 24 year olds. “Antioxidants, probiotics…keep you looking younger.”
AARP did a study that demonstrated the willingness of seniors to consider new products and brands. The opportunity is there for marketers and retailers to reach out and engage this segment of the market. However, the marketers should realize that with age comes experience and wisdom. Don’t treat the baby boomers as though they are still babies, willing to grab at whatever is colorful and makes a cheerful noise. Yes, pay attention to the boomers’ needs. And learn how to reach them with products and messages that are relevant, credible and fulfilling…and packaging that is easy to open and easy to read.
Good luck! And indeed Start Your Engines! See if you can catch up to the Baby Boomers.
With the tsunami of people born from 1946 to 1964 reaching retirement age, retailers have a wealth of opportunity to capitalize upon that market. The great news is that the Boomers will be the most wealthy retirees in history. HOWEVER, that does not mean that they will spend frivolously. Boomers have driven the “value” mentality from the start. So although their spending power will not diminish as significantly as previous generations as they enter retirement, retailers must target them with appropriate value-priced merchandise.
Not all Boomers are created equal. There are the younger Boomers, who are going to PTA meetings for their elementary school children…and then there are Boomers who are happily retired in Florida. The lifestages and mindsets vary widely.
However, I have observed a common problem in almost all Boomer Marketing: a patronizing tone. Here is a group of people who have been exposed to more media, more experiences and have actually lived longer than any other generation on the planet. Let’s not talk to them like they are sheltered or simple.
For baby boomers, the economy is pretty much recovered. Jobs are not so important anymore since most have deep pockets with IRAs, 401ks, pensions, and other investments while the magic 55 retirement age seems to be the norm. With housing prices now so very affordable, I’m seeing my friends quickly disappear to Arizona, Nevada and Florida. Senior citizen discounts for everything makes the dollars go so much further. One thing for sure, seniors are very tech savvy, especially those in the 55 to 70 range.
John Krubski and JP Terlizzi of Medallion Retail provided some insights into Boomers at GlobalShop last week. The focus of their presentation was on Millennials, but in order to get there, they started with Boomers and compared and contrasted. Here are some (obviously generalities, but based on Medallion’s consumer research) of my notes from what they shared:
They estimate that Boomers are worth about $2.2T (yes, trillion) in consumer spending. They view work as fulfilling–they “live to work.” They view their vacations almost as a second job–they have to get “the most” out of their vacations and tend to plan every last minute. I have a feeling that this may translate to their retirement too.
For them, a car was a rite of achievement (as opposed to their parents’ rite of passage–It’s not about getting a car, it’s about getting a BMW). I think losing the car (the ability to drive) as Boomers get older may be significantly impacted by this particular attitude about cars, if it is so closely tied to a sense of achievement or “making it.”
Education was a birthright for Boomers (vs. a privilege for their parents), their defining technology was the GE Carousel of Progress, and their defining retail experience was the mall. Shopping is about living large (vs. Gen-Xers who view shopping as a way to live “fine”). How will that evolve as they grow older? I don’t know, but I have seen my own Boomer parents devote as much effort and drive in supplying their grandchildren with “the best” as they did for themselves when they were Yuppies (funny that it kind of skipped generations, there <=)> ).
I think my conclusion is that these defining moments in their lives–the car, and what it means to them; shopping, and what it means to them; technology; what drives them when they spend their free time–none of that is going to really change as they age. What they focus on might–grandkids being a good example–and the means they may have at their disposal may change, but the drivers will remain the same. If you can tap into the underlying needs (ah yes, the “why behind the buy”), then you’ll have it made as a retailer or brand, no matter which generation you’re targeting.
Why aren’t baby boomers designing products for baby boomers? Who better to be able to relate to the needs and desires of this increasingly important group of consumers? Kids complain about a generation gap, well the same can be said in reverse. Marketing to this group is a potential gold mine to the manufacturers that can get it right.
What a depressing tale! I’m a Boomer, and the thought that “easy to open packages” are or ever will be the key to my heart really makes me cringe.
This is the generation that wants to be forever young. It’s about the only thing we have in common…that, music, and a desire to have high quality anything–including quality of life.
I think the key to marketing to Boomers, regardless of segment or lifestyle, is FUN. Emphasize fun.
Time to go look at some nice festive Depends packages in the store. Ugh.
The image of retiring and sitting in a rocking chair for the rest of their life is not the senior of today. With a life expectancy pushing 80, there are different phases for seniors. Smaller portions are common with aging, but with the increase of 3 generation households, they do not show up. Nor does an increase in spicy flavoring match the ‘old’ image.
Seniors will likely go through 3 phases. First is extreme activity. Second is active and the third is reduced activity. Health concerns increase with age so products need to be age appropriate. The baby-boomers have been our largest population group and have driven consumption. They will continue to drive consumption, but at a declining rate. Product attributes that are health related will increasing be important and package size may or may not be a factor depending on household size.
Some food retailers, like Kroger in my area, fail to understand that “buy 1 get 1 free” promotions have negative appeal to seniors, especially on perishables such as baked goods, bread etc. On many occasions I would have bought 1 at half price, but cannot use 2, so I buy zero! Kroger does this on their own house brands so it is not just a manufacturer pushing that requirement to move some volume (as if any manufacturer is going to tell Kroger what to do in any event). Also, some seniors may not have the money to “stock up.” Thankfully there are other retailers, e.g. Giant Eagle, that as a general rule let you buy 1 at half price whether the item is perishable or nonperishable, food or nonfood.
Liz called out the two most important considerations: life stages and mindsets. The big opportunity lies in segmenting the boomer market along those lines and marketing to each segment separately. The boomer market may be massive, but it’s not monolithic.
It’s erroneous to make assumptions about baby boomers and how to market products and services to them. This has always been a generation of individual thinkers since the very start.
I find this conversation slightly ironic as the counter question naturally is, “Who do you think we’ve been selling/marketing goods to for the last 30 years?” Yeah, Boomers. We should be pretty expert in this area, right?
Now, we might have to work a little harder in terms of some pretty perfunctory issues, like font size, but the fundamentals will be the same.
Think: NOT actually getting older … Boomers don’t age! Stay aspirational. Boomers have always been better in their own minds than they actually are–so continue to sell the dream! “The Dream” may have changed from a BMW to a better vacation, but it’s still the same premise. Stay the course.
The real challenge will be their smaller wallet/spend. There might be expendable income and even more of it, but after this recession and experience with 4 or 5 others, there might be a little more caution in the air. Might being the operative term (Boomers don’t save!).
You talkin’ to me? You talkin’ to me? (My Robert De Niro imitation!)
First of all I don’t think any designer under 47 should be used to design hotel amenity packages. Putting the word “shampoo” in pale yellow 4 pt font on clear plastic backing is just bad design for any age. There I’ve said it and I’m glad.
I endorse those who pointed out that being over 60 does not mean we’re looking for pastel stretchy knits with Velcro fasteners. Nor are we interested in matching car coats like our parents were. We, with a few exceptions, are very much alive and looking for a good time. The word ‘retirement’ isn’t even in our vocabulary–not because of economic times–but because many of us are just getting going.
Bring us variety, color, innovative products, great designs…and we’ll make you a very wealthy retailer.
The baby boomer segment is so wide and varying that saying ‘I market to baby boomers’ is like saying ‘I market to all living creatures’ in the universe. There are baby boomers who made it in life and want to sail and smoke Viscount cigarettes and then there are baby boomers who’s only thought is where they are going to find the money for their next batch of diabetic test strips. More detailed research is needed when bringing baby boomer products to market. There are several (hundred?) buying groups within that definition.
I don’t believe that Boomers (I am one) will be switching in droves to Private Label as they retire. Those who tended to be Brand oriented during their pre-retirement years will likely remain so. We may become more price sensitive but I can’t imagine sacrificing quality as we enjoy our Autumn years. I would focus on Right Sizes, Right Stores, and targeted coupons to Seniors.
Packaging is the silent sales person. Boomers have the money and are willing to spend it but make no mistake, they will be analyzing their choices carefully. Packaging is the primary method for conveying your message.
When creating packaging that will appeal to them and persuade them to buy, here are a few points to consider:
Don’t look at boomers as an aggregate mass. Even within the boomer segment, there are differences in the age brackets;
Don’t assume the 50+ are brand loyal. They grew up on branding but are willing to make a change after careful consideration;
Don’t hype or over exaggerate claims. This has a negative effect, not a positive one;
Use images boomers can relate to;
Whether you use the word, “boomer,” “senior over 50,” or “aging,” this age group doesn’t want to be referred to as old;
Sell Boomers the experience and the benefits that come in using your product or service;
Lastly make it easy for them to read and open.
You have less than 3 seconds to engage them. Don’t waste it by not sending the right message on your packaging.
“Easy to open packaging is necessary. Have you ever watched someone who is ‘older’ or who has arthritis try to open something as simple as a salty snack? Now imagine or watch the process for a health or beauty aid product in a clam shell, or mummified in cellophane?”
Joan Treistman, President, The Treistman Group LLC
Music to my ears! In addition to seeking to appeal to boomers’ sense of frustration of waste in advocating reuse, especially of the designed-in variety, it has been welcome to find that some simple efforts in this area can also result in clear advantages in the the enabling arena as well.
What is interesting, if a little concerning, is the move to many tamper-evident designs that seem to be making things even worse. Maybe this piece, and the comments that support it, are not before time?