'Baby boomers:one size does not fit all' - Eye opener for retailers
Since bursting on the scene in the late 1940s, baby boomers continue to have an outsized impact on the U.S. economy. In fact, the 76 million Americans born between 1946 and 1964 possess an annual spending power upwards of $2 trillion.
Consumer packed goods (CPG) retailers and manufacturers that view this group as a single target market do so at their own peril, according to the IRI Times & Trends Report, “Baby Boomers: One Size Does Not Fit All.” Despite sharing many seemingly formative historic experiences, the baby boomer generation prides itself on individuality and is really quite diverse.
“Market leaders who want to most effectively meet the needs of boomers, some of whom are in their 60s, while others are still in their 40s, must identify the distinct and ever-changing attitudes and behaviors of literally hundreds of micro-segments based on income, geography, shopping trip missions, health and wellness and many other factors,” says IRI Consulting and Innovation President Thom Blischok.
Despite the great sense of individualism within the baby boomer generation, there are some broad commonalities among baby boomers that are worth noting. For instance, approximately two-thirds of boomers will continue to work after retirement, some out of financial necessity and others from an eagerness to remain active.
Baby boomers, like their Generation X, Generation Y and younger compatriots, use the Internet actively to get information, research products and make purchases online. And, like no other generation before, baby boomers rely heavily on CPG products, such as food, beverages, vitamins and supplements, to sustain high levels of health and vitality. For the CPG industry, the opportunity is immense.
The IRI study recommends the following action-oriented steps that retailers and manufacturers can take to meet the needs of the aging baby boomer population:
-Anticipate and proactively address changes in product needs and shopping preferences through frequent and granular consumer and market assessments.
-Develop best-in-class marketing, pricing and promotion strategies for key categories; re-evaluate distribution strategies to align with shopping patterns.
-Understand the core healthcare needs across key consumer segments; align product assortment and merchandising programs with chronic and/or frequently-occurring ailments.
-Re-evaluate existing programs frequently to maximize relevance and response for high-priority categories and segments.
Retailers must support private label initiatives with targeted ads and display-based merchandising; brand manufacturers must re-evaluate pricing strategies to ensure alignment against the value needs of key consumer segments.
“The changing needs of an aging baby boomer population, combined with today's economic transformation that is causing consumers to shift how they live, work and shop, should be driving manufacturers and retailers to completely reformulate how they design, launch, merchandise, promote and price products,” adds Blischok.
“To be successful, it's imperative that marketing approaches are based on a dramatically deeper knowledge of shopper attitudes and behaviours that change rapidly to meet the needs our industry's largest and most powerful consumer segment.”
Information Resources Inc