Grow up, Already!

It’s time for consumer marketers to wake up to the 50-plus market, the growth segment of the new millennium. Some facts and some tips.

In the marketing game, you go where the dollars and the numbers are, right? Then why are so many top consumer marketers continuing to pour all their funds into young families and Gen X’ers, forsaking the group that demographers absolutely assure us will rule the American roost in the first quarter of the 21st century?

Of course, we’re referring to those ubiquitous Baby Boomers, who are currently turning 50 at the rate of one every seven seconds. Let’s go to the Census Bureau:

Americans 50 and older currently comprise 37 percent of the population, but in a mere 15 years, nearly every other person you pass on the street (46%) will be a card-carrying AARP member. In sheer numbers, that translates to some 96 million seniors in 2010 and 114 million in 2020.

Already mature Americans make up a market larger than that of the United Kingdom or France, and as life expectancy continues to increase, aging consumers will leave their young whippersnapper counterparts in the dust. The 50-to-64 segment is expected to grow at a rate of 49 percent during the first 15 years of the century, while the 18-to-49 group looks to actually decrease by a percentage point or so. Oh, and by the way, 50-plussers take in 42 percent of after-tax income in the U.S. and hold 77 percent of all assets.

Still, efforts aimed directly at this economically formidable group remain largely the domain of pharmaceutical and financial services companies with products aimed squarely at the empty nest life stage. “The general feeling remains, `If I spend $5 on a 12-year-old, I’ve got a lifetime customer. Fifty-year-olds are not a good investment,'” says Donald Lowy, senior vice president of research at The Senior Network, a Stamford, CT-based mature marketing company that is making sustained progress in changing that attitude.

In Minneapolis, ad agency veterans John Nielson and Scott Moncrieff founded The Sandcastle Group to create seniors-targeted advertising when they realized their former employers had little interest in communicating to older consumers. “The majority of agencies hire young people who like to do fun, funky stuff. When they try to do campaigns for mature markets, the creative tends to fall flat,” says Sandra Johnson, director of client services at Sandcastle, whose client list, while rife with the expected health care, pharmaceutical, and financial companies, also includes General Mills and the YMCA.

Sandcastle Partners has called upon market research gurus to develop what it calls “mature excitement” principles that it employs in all of its campaigns. One, conditionalism, holds that, because people 50 and up are generally media-savvy and smart buyers, appeals should not be overly aggressive. “You don’t need to tell them exactly how to wear their pants or how to live their lives,” reads the Sandcastle litany. “Communicate your brand position, but keep the conceptual door open. They’ll complete the picture.”

Another agency guideline, revitalization, warns marketers to avoid assuming that retirees are simply whiling away their remaining years. On the contrary, most see retirement as a time for “exciting discovery of unknown interests,” per Sandcastle.

The Generation Gap lives

That notion was influenced by the work of David Wolfe, a Reston, VA-based market researcher who has closely studied the mature market since 1983 and is the author of a book entitled Serving the Ageless Market. “Very few marketers really understand some of the deeper, less obvious, attributes of the older psyche,” says Wolfe. “We did a series of focus groups a few years ago which uncovered a major issue that did not come up in primary research. They have a very strong need and desire to find a purpose in life.”

Wolfe’s client at the time was a retirement housing developer, whose ads and promotional materials all emphasized recreational activities, golf courses, and tennis courts. “Younger people marketing to older people tend to look at retirement as a 52-week-a-year vacation,” Wolfe says, “But many older people don’t identify with that kind of value.”

Wolfe suggested the developer change his creative theme from year-round vacation to a “be all you can be” message. The following month, the developer sold 50 units, far surpassing his monthly average of 21 units.

Wolfe’s feeling is that consumer products marketers avoid marketing to seniors because they fear such efforts will taint their products as uncool among younger consumers. But he also sees the failings of basic human nature coming into play. “People who aren’t there yet don’t understand the mature consumer very well,” observes Wolfe. “Age is more of a concern of people in their forties and fifties than people in their sixties and seventies. I often quote a Harris Poll that showed the majority of 60-year-olds saying they liked the age they were at and wouldn’t want to go back.”

As the 50-plus age segment builds to an overwhelming stage of critical mass, Wolfe says he sees marketers slowly getting the point, almost unconsciously. “Don’t market to their age,” he says. “Market to their aspirations.”

Noting that their aspirations may often parallel those of younger Americans, Wolfe counsels marketers to be wary of oldster-only events such as senior fairs. “They often draw lower-income people,” he says. “Exhibitors end up saying, `Seniors are interested in anything, as long as it’s free.'”

Vital actions

One packaged goods brand manager who’s had great success marketing to seniors is Tim Simons of Procter & Gamble, whose Oil of Olay ProVital line extension for menopausal women has fared so well that, after just one year on the market, it has already spawned two other extensions. The original ProVital contains a special vitamin blend, and new varieties have a cleansing lotion with beta hydroxy and a sunscreen.

“What we found early on is that success in this segment relies upon recommendation from a friend,” says Simons. “So we started with sampling programs aimed at key influencers like charity leaders and presidents of golf leagues and gardening clubs.”

Simons also employed The Senior Network’s travel sampling program, a vehicle he says was “very helpful in getting the new varieties out to an active segment.”

Youth-happy brand managers may not be aware of the existence of an outfit called Group Leaders of America, an association of some 20,000 senior citizens who plan trips for their friends on a local basis. The Senior Network set up an arrangement with the group to provide them with travel sample packs. Not only are the sample products welcomed and almost assuredly used by the sojourners, but group leaders have captive audiences on buses and planes to whom they can present product features and benefits. It’s hardly a small audience: Last year, about seven million seniors embarked on such trips.

Marketers’ increasing interest in the mature market is evidenced by the continuing growth of The Senior Network, which got its start in the late ’80s when founder Rick Adler installed free bulletin boards in senior centers and sold ads that appeared on monthly posters center managers were required to post. The bulletin boards now reside in 2,500 centers, and The Senior Network has expanded its reach to sampling, events, sponsored seminars, cause marketing, and most recently, the Internet.

Reach Grandma on the Internet? Senior Network research chief Courtney Day insists it’s no pipe dream. “Right now, there are 13.5 million seniors online, but we’ve determined that half of them are heavy participants in promotions and coupons,” she says. “In 10 years, people over 50 will be 45 percent of the online population. That will be about 20 million people.”

Adler went back to the company’s roots to create theseniornetwork.com. Traffic to the site is fed locally through senior centers, each of which is given its own page on the site to list local events and even sell local advertising. The site’s home page features editorial content of interest to seniors and special entertainment features, such as an online bingo game in which individual senior centers can compete against each other. Since seniors tend to be bargain-hunters and coupon-clippers, there’s a Value Center click banner that presents all advertiser offers available on the site. B anner ads and offers can be customized locally by Zip Code.

For the present, the company hopes senior centers will coax more elderly Americans onto the site. And if the site survives into the next 10 or 20 years, the 50-and-over targets will all be old Net jockeys.

“Twenty years ago, 50 was over the hill,” says Day. “Now it’s the prime of life.”