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don’t foRget the BooMeRsTO STAY FRESH AND RELEVANT, MARKETERS OFTEN SEEK THE NEXT

BIGGEST CONSUMER TARGET...

...CULTIVATING RELATIONSHIPS NOW THAT DRIVE TOWARD LONG-TERM BRAND LOYALTY.

The most recent generation to see this attention — and one worthy of focus with their

signifi cant purchasing power and social infl uence — is the Millennial segment (age

18-34). We wrote about them in our last paper, and agree that they are a massive

generation that is set to change the face of marketing as we know it.

Yet, we CAN’T FORGET THE BABY BOOMERS. These consumers (born 1946-1964) are

the parents of “generational infl uence” and proved to be one of the most marketing-

friendly consumer groups in history. THEIR SIZE AND PURCHASING POWER CARVED

THE PATH UPON WHICH MILLENNIALS NOW WALK, and taught marketers a thing or two

about the value of paying attention to the wants and needs of the people buying their

products and services.

THIS GENERATION IS ALIVE AND WELL, with still critically important “chops” in their share

of purchasing power — THE “SILVER TSUNAMI” that, while it may be slightly different

in the types of products and services in which they are interested, is still impactful and

worthy of continued attention.

In general, there are some misperceptions that exist about Baby Boomers, as well as

some still-strong marketing opportunities that speak to the VALUE THIS GENERATION

STILL HOLDS.

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BooMeRs hAven’t stopped BooMIng

%

34

WHILE THE 18-49 POPULATION IS EXPECTED TO GROW

BY 2030, the 50+ POPULATION WILL GROW

12%

OF THE U.S. ADULT POPULATION WILL BE AGED

50+

%

50BY 2017,

70 CURRENTLY, BOOMERS

CONTROL

OF ALL U.S. DISPOSABLE INCOME.

% 15BOOMERS ARE SET TO

INHERIT

TRILLIONIN THE NEXT 20 YEARS.

MYth: Boomers have already lost signifi cant size and spending power and share of the market.

ReAlItY: Boomers number roughly 80 million and exert considerable fi nancial control of the marketplace (and will continue to do so for years to come).

Source: Nielsen and BoomAgers Report, 2012.

$

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theY ARen’t who You thInK theY AReWhile much research has been conducted over the years to understand and predict Boomer

behavior, they have proven to be highly adaptable to change. Much of what you might have

thought about Boomers may be inaccurate or dated.

MYthMAnY BelIeve BooMeRs ARe…

ReAlItYBut In ReAlItY, BooMeRs ARe…

…following traditional pathways to retirement and looking to settle down.

…bridging the gap between their careers and retirement with non-traditional activities.

…“set in their ways,” less active and less open to change.

…seeking new experiences and building new connections that enrich their lives.

…stingy with their money and losing signifi cance as consumers.

…infl uential consumers willing to spend their hard-earned money on things that matter.

…increasingly out-of-date and out-of-touch with modern society.

…young-spirited, fi ghting to stay current and relevant.

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educAtIon

woRK• Financial strains resulting from the Great Recession, their children’s education costs and elderly parent caregiving, many Boomers are postponing retirement. • The number of workers over 65 is expected to grow by 80% by 2016. U.S. Bureau of Labor Statistics

• Boomers are dipping in and out of retirement, mixing later life leisure with ongoing work life to help themselves fi nancially and stay active and relevant.• 80% say they will continue working, even upon retirement. Del Webb Survey, 2013

new pAthwAY to RetIReMent

BooMeR lIfe stAges

tRAdItIonAl lIfe stAges

• “If I stop learning, I stop living.” Many Boomers seek opportunities for continued learning and knowledge, not only to sharpen skills for their current job, but to set the stage for personal enrichment and pleasure. • As of 2012, 45% of adults aged 45-64 participated in adult education. MetLife Mature Market White Paper, 2012

Boomers have rewritten the traditional path and blurred the lines between life stages. In effect, they are exercising their freedom of choice, while still remaining committed to their goals.

Previous generations have followed a sequential pathway through three distinct life stages: education, then work, then retirement.

RetIReMent

educAtIon woRK RetIReMent

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• Although many continue to work even after retirement, not all are

doing so out of necessity. + In 2011, Boomers produced the most new entrepreneurs of any generation, demonstrating their need for enrichment and continued learning. + 51% plan to avoid boredom and maintain a sense of purpose by working. 46% say they “like to work.” Del Webb Survey 2013

• As the healthiest, happiest, most educated, and most active generation ever to

come into retirement, Boomers are not ready to settle down as they age.

• Instead, having come of age during a period of activism and social reform, they aren’t just

open to change, they are accustomed to it, often seeking ways to elevate their experiences.

• Rather than the traditional move to golf course communities upon retirement,

Boomers are looking for living arrangements that foster active lifestyles.

+ chAngIng geogRAphY: Relocating to cities with vibrant culture, outdoor activities and social happenings.

+ lIvIng Young: Looking for exciting and healthy activities that promote physical/mental well-being.

+ cultIvAtIng new: Building new relationships, experiences and connections to expand and grow in all areas of their life.

Nearing retirement, Boomers plan to focus on:

Activities that enhance health and well-being.62% Reinvention and

self-discovery.51% Spending time with family.51%Travel.59%

DEL WEBB SURVEY 2013; TRILOGY LIFESCAPE SURVEY

gRowIng oldeR Boomers are changing the face of aging.

It is not about gettIng older, but fi nding ways to gRow older.

KAUFFMAN INDEX OF ENTREPRENEURIAL ACTIVITY, 2012

NEW ENTREPRENEURS BY AGE

Age 45-54 Age 55-64

1996 2011

49%

38%

24%

14%21%

28%

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• As their children fi nally move out of the house and they move into later life, BooMeRs ARe looKIng foRwARd to spendIng theIR hARd-eARned MoneY on theMselves.

• Over 2/3 plan to spend more time on their hobbies post-retirement.

• In particular, they are attracted by activities and brands that are updated versions of pRoducts theY gRew up wIth — enabling them

to tap into the happy emotional times of their youth.

old MeAns gold

While Boomers face fi nancial constraints, their ability and willingness to spend money has not been reduced,

but is simply more pragmatic and discerning toward what matters most.

J.D. POWER AND ASSOCIATES’ AUTO OFFLINE MEDIA REPORT, WINTER 2012 NIELSEN AND BOOMAGERS REPORT, 2012.

62% 80%

AUTO SALES LUXURY TRAVEL

BOOMERS REPRESENT…

• Unlike their parents, BooMeRs gRew up In A post-wAR peRIod of optIMIsM And Affluence, resulting in deep-seated “consumerist” values that persist today.

• However, having faced a variety of fortunes and misfortunes in their lives, they demonstrate

pRActIcAlItY and sAvvIness in their decision-making.

• While MARKeteRs ARe depRIoRItIzIng the potentIAl of thIs geneRAtIon As “consuMeRs,” the reality is that they must keep fi ghting for their attention.

• Contrary to popular belief, Boomers are no MoRe oR less BRAnd loYAl oR pRIce-conscIous thAn otheR geneRAtIons.

• However, to cultivate a relationship with them, Boomers expect to Be RewARded foR theIR coMMItMent to brands.

80%

50%

BOOMERS

MILLENNIALSpRActIcAl decIsIons

dRIve choIce of RetAIleRs foR BooMeRs - 60% MoRe

thAn MIllennIAls.

of Ad dollARs ARe tARgeted to theM.less thAn

BOOMERS PURCHASE

CLOSE TO of All cpg pRoducts, But50%

5%

Source: Nielsen and BoomAgers Report, 2012.

Source: The Brodeur Partners’ Retail Relevance 2012 Study.

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• BooMeRs ARe eAsIlY ReAchABle BY MAnY of the sAMe tools used foR YoungeR geneRAtIons — while late to the game, they are now the fastest growing

generation for social media and smartphone usage.

eldeRlY, schMeldeRlY… The media is sending mixed signals about the Boomer generation — presented as either incapable and out-of-date or shown in unrealistic

scenarios that are not true to life. Boomers are fi ghting to dispel these portrayals with their pocketbooks and the brands they choose.

1960s Pepsi ad targeted at Early Baby Boomers.

Boomers do not relate to ads that appear fake or unrealistic.

• Beginning in the 1960s, marketers began targeting Boomers.+ Similar to Millennials, Boomers were targeted because

of their large size and infl uence on culture (sex, drugs,

and rock & roll).+ Brands like Pepsi and Levi’s aligned themselves

with America’s free-spirited youth and this “new

generation.”

• With attention now being shifted to younger generations, BooMeRs ARe often dIsAppoInted BY Ads they deem patronizing and

that depict them as “older than they feel.”

• Early Boomers (ages 58-67) will not even think of themselves as

“old” until they are nearly age 80. MetLife study of Oldest Boomers, 2013

• BooMeRs wAnt to Be ReAlIstIcAllY RepResented.+ “Brad Pitt and Madonna are my age. Does the world look at

them as being old?”+ 55% of Boomers agree that if they feel advertising is relevant

to them and their lifestyles, it has signifi cant impact on their

purchasing decisions.

Source: Pew Research PIP Report, 2012 Source: Pew Research Smartphone Ownership, 2013

Source: © 1964, Pepsi-Cola Company

Source: cialis.com

CHARGING

50%

CHARGING

50%

+ Nearly 50% of Boomers are smartphone users.

+ 52% use social media sites, with Facebook dominating.

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how do we engAge BooMeRs?

iNDepeNDeNce • coNstaNt stiMulatioN • tHirst for KNowleDGe •

• eNaBliNG a BalaNceD life• coNtiNueD learNiNG• Variety

New experieNces •social coNNectioNs •

pHysical/MeNtal eNricHMeNt •

• eleVateD Quality of experieNces• eNGaGeMeNt• creatiVity outlets

practicality + iNDulGeNce • atteNtioN aND wooiNG •

appreciatioN for loyalty •

• NostalGia• exclusiVe offeriNGs aND cHoice• rewarDs

respect aND Value •releVaNce •

coNNectiVity •

• acKNowleDGeMeNt• realisM• youNG-as-you-act iNclusiVity

MotIvAtoRs connectIon oppoRtunItIes

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New/Quality of experieNces

Young-As-You-Act InclusIvItY

connectIvItY

Respect And RelevAnce

ApplIed MotIvAtoRs / connectIontoYotA venzA

• In 2011, Toyota launched a campaign for Venza, which satirized

misconceptions about Boomers’ tech incompetence and boring

lifestyle.

• Toyota was effective in celebrating the outgoing and active nature

of Boomers, in contrast with younger consumers’ tech obsession.

• Success was achieved, with over 70% of Venzas sold to Boomers.

toYotA AvAlon• Toyota recently launched a new Avalon campaign targeting

younger Boomers, in an attempt to lower the average Avalon

owners’ age from 67.

• The “Let’s Go Places” tagline encouraged Boomers to try new

experiences.

• The campaign utilized optimized messaging for tablets and

mobile devices, knowing that boomers are tech-savvy.

3

3

3

3

coMMItMent to BooMeR RelevAnce

Source: toyota.com/venza

Source: pure9studios.com

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vARIetY/thIRst foR Knowledge

exclusIve offeRIngs

phYsIcAl/MentAl enRIchMent

New/Quality experieNces

• Heineken utilizes its Ideas Brewery to crowdsource innovation. The April 2013 “Challenge” asked consumers around the world to

provide ideas for a new beer concept targeted at people age 60+ that would fit their lifestyle wants and needs.

• This brand demonstrated keen insight on the mindset of this target via the categories in which ideas had to flow to qualify for the

$10,000 prize.+ Quality experiences+ Learning and re-discovery+ More time for social activities

• The winning idea was “Fahrenheit 60+,” a series of new tastes/brews with a unique story behind each within the Heineken brand.

3

3

3

3

InnovAtIon foR BooMeRs

ApplIed MotIvAtoRs / connectIon

Source: ideasbrewery.com

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RewARds

nostAlgIA

BAlAnced lIfe

connectIvItY

• Declining category sales (fewer children and Millennials who sit down for cereal at breakfast) is driving cereal manufacturers to fi nd

ways to make their products relevant again in expanded ways with adults. Specifi cally with Boomers who are still engaged with this

product for breakfast and as a snack.

• Specifi c brand actions are leveraging trends among Boomers — happy nostalgic memories and increasing interest in health and

nutrition.+ Lucky Charms is a brand “built” on Late Boomers (introduced in 1964), and with still-remaining value from a nostalgic

standpoint to this generation. New communication that helps adults remember “how good of a cereal it is” are resulting in

increased sales and growth in usage by adult audiences, including Boomers.

— “We know that adults have always loved Lucky Charms and by reconnecting them with the brand, we have reignited their love of one of their favorite things from childhood.” (Carla Vernon, General Mills’ Marketing Director for Lucky

Charms.)+ Kellogg’s is introducing multiple products with nutrition-based innovation, including:

Raisin Brand Omega-3 and Special K MultiGrain. Its Kashi brand will roll out a new Heart

to Heart product with fl ax and omega 3.

• These brands are attempting to stay relevant and evolve with consumer wants/needs.

3

3

3

3

connectIng: nutRItIon And nostAlgIA

ApplIed MotIvAtoRs / connectIon

Source: uncyclopedia.wikia.com/wiki/File:Lucky_charms.jpg

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pRActIcAlItY And vARIetY

AcKnowledgeMent

ReAlIsM

Young-As-You-Act InclusIvItY

• In April 2013, Amazon launched its 50+ Active & Healthy Living store, a hub for Boomers to shop for health, beauty and

entertainment products.

• Items grouped on the site are likely accurate in their practicality for this audience, and the site does, in fact, contain items for both young

and old consumers, such as health/exercise, technology and travel.

• However, it also is “loudly visible” in what could be perceived as “products for the elderly,” i.e., mobility, incontinence, wrinkle creams,

hair coloring.

• Amazon has received signifi cant negative feedback from those who feel the brand is generalizing the “needs” of the 50+ age group.

• The concept has legs, and depending on Amazon’s success with this idea, other retailers may follow suit. However, based on comments

from the retail industry and consumers across multiple independent resources, additional work is needed to better align the concept

with the reality of this consumer segment.

3

3

pItfAlls of IgnoRIng BooMeR InsIghts

ApplIed MotIvAtoRs / connectIon

ReAlIsM

Young-As-You-Act InclusIvItY

3

Source: betanews.com/2013/04/15/amazons-over-50-store-makes-me-puke/

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If nothIng else, Know thIs…

• In the mad dash to engage with Millennials, DON’T FORGET ABOUT BOOMERS — they are an important consumer group. • Opportunities for products/services and engagement exist with this generation that go far beyond a narrowed focus on “gray hairs.”• They represent A LARGE POPULATION BASE THAT HAS TREMENDOUS SPENDING POWER.• To be successful, marketers must understand their emotionally-charged motivators, and implement actions that will relevantly connect and cultivate loyalty. This means: – DON’T STEREOTYPE this generation and the products and services they need. – Don’t use IMAGERY AND COMMUNICATIONS CHANNELS that are not in touch with the reality of this consumer base. – Remember their YOUTHFUL MINDSET, which helps them feel and stay “young” longer. – Respect their value and acknowledge their practical and DISCERNING DECISION-MAKING EXPERIENCES. – Engage with them in ways that REWARD THEM WITH CHOICES, inclusivity, creativity outlets and new/elevated experiences that enhance their lives.