Economic power is not where marketers think it is
A few days ago, Mumbrella Asia published an article summarising a keynote by Ad Contrarian Bob Hoffman’. In it, Hoffman questioned why marketers are fixated on a youth demographic when women over 50 control 95% of household expenditure.
The statistics on this generation should be a marketer’s dream. Not only is the Baby Boomer cohort large, it’s disproportionately wealthy. The US Boomer generation on its own constitutes the third largest economy in the world (if it were a country only US and China would be bigger).
In Australia, Baby Boomers are a quarter of the population but control half of household wealth.
As they enter retirement, Baby Boomers look to be the most cashed up AND time rich generational cohort the world has EVER seen.
This ‘misunderestimation’ leads to irrational marketing spend
The evidence is that a WHOPPING 75% of marketers underestimate the spending power of this market with important consequences.
As Hoffman pointed out, just 5% of marketing spend is targeted at this 95% of the market.
In my mind, I try to imagine what the board room conversation would be if marketers stood up and tried to justify that based on the real numbers. I don’t think they would get too far, do you?
That this happens is part of a compelling cognitive illusion.
As a result, it’s also embedded in the context of our decision-making via something called the ‘key ratings demographic’. Media planning and advertising rates are built around this. This places a disproportionate weight on attracting an audience of 18-39 year-olds, with a secondary target of 34-54 year-olds.
As an evidence-based marketer (and a woman over 50) this makes my blood boil. The most recent example is from another Mumbrella article (if you aren’t based in Australia the reason that Mumbrella gets quoted twice is that it is the ‘go to’ publication for people in media and marketing here) noting that viewing figures for Australia’s public broadcaster outperformed those of the free-to-air commercial channels in the peak viewing period. Now this may have been as a consolation prize for the commercial channels, but it noted that they won the ‘key ratings demographics’.
Cue my close to transformation into a human puff adder or the Incredible Hulk. I’m not sure which is worse – celebrating reaching a market with a disproportionately low spend or the fact that in a weird way it IS success because that is who they wanted to reach.
The over 50s market is not who we think it is
A common rationale for this is that the over 50s market is not experimental and doesn’t spend money. Our research suggests that this is another compelling cognitive illusion.
Senior couple riding motor scooter having fun.
Beyond their wealth, it’s worth remembering who this generation is:
- They were the first generation that grew up with brands and brilliant creative advertising
- In travel, they were the generation that created Lonely Planet and the need for it – the first backpacker and gap year generation
- They are the generation that refuses to ‘grow old’: according to the Futures Company (now Kantar Consulting) 80% of Baby Boomers thinks the future belongs to them. One manifestation of this trend is the number of women in their 50s who are instituting divorce proceedings. They are driving solo travel including in the Adventure Travel market
- They are the funders of the explosive growth in multi-generational travel
Like any market if you don’t talk to them, they don’t buy from you
If they aren’t buying from you, that’s because you aren’t communicating with them right.
Over and over we here from this market that either they are completely ignored or that the marketing targeted at them is cliched and irrelevant. At best they feel patronised. But often they literally feel invisible.
So passionate are we about the opportunities in this sector at MyTravelResearch.com that we have created and shared a bunch of assets to help you connect with them. Members can connect to our seniors travel persona and our seniors travel research. Non-members can check out our seniors infographic
Indeed so passionate are we that – to misquote a famous 80s ad – we ‘split the company’. MyTravelResearch.com Co-Founder Bronwyn White is now running a consultancy dedicated to unlocking this and doing a further deep dive into the market. You can find out more here including details of her workshop here
It’s time* to change the context
It’s more than time that we started to think differently about who is our real target market and how we reach them.
I think one key step to this would be to dump the concept of a ‘key ratings’ demographic. It sounds a small thing but it would dramatically change the context of how we plan and price media. And we know from behavioural science that changing the context changes EVERYTHING.
Imagine if instead the key ratings demographic was – did this programme match the target that was bought to it?
The real key demographic for your media buy is the one that will make you the most money. And that may not be who you think it is. Clearing away those invisible assumptions could unlock that thinking.
In the meantime, the over 50s market is going to be a great value media spend
* most Australian boomers will resonate with this phrase!
Great observations Carolyn.
Thanks Becca… let’s hope the industry is listening