Baby Boomers remain the nation’s biggest spenders overall, and comparing discretionary spending in 2012 to 2017 shows that Age Tier 55-59 beat out Age Tier 50-54 as the group with the highest spending.
By 2030, there will be more people who are 65 and older than there will be people under 25. This is the first time in human history that this is so.
By 2050, 2 Billion people will be over the age of 60.
Today, most retailers are watching Gen Z develop into full-fledged consumers as they begin to enter the workforce. Born after 1996, Gen Z is now steadily joining the key demographic targeted by most traditional marketing: age 18-49.
But while marketers are being lured in by the prospect of a younger consumer, ripe with lucrative, long-term potential, retailers are neglecting an arguably more lucrative source of business: Baby Boomers.
Obviously, Gen Z and Millennials should not be disregarded, but even while shrinking in size, the Baby Boomer generation makes up just under the same percentage of the U.S. population as Millennials and a higher percentage than Gen X. They should not, and cannot, be ignored.
Not only are Baby Boomers the wealthiest generation, holding 70% of the disposable income in the U.S. and spending over $548 billion a year, but they also they spend more than any other generation, across all categories. This includes spending the
most per transaction.
At about 71.6 million strong, this generation represents a significant opportunity for retailers. Many Baby Boomers who have become empty nesters or retired have the disposable income to spend and are spending it on themselves, their kids, vacations, education, and more.
The problem is that most retailers don’t understand this new landscape and traditional marketing approaches are not always as effective with this consumer segment. These approaches lack the perspective required to understand who these consumers are and what they need. For example, many Boomers, especially those with kids or grandkids, are tech savvy and connected to the digital world. Failing to recognize that is a missed marketing opportunity.
Today’s Boomers are experiencing a unique combination of life events—including getting married, getting divorced, starting new careers, going back to school, becoming grandparents and great-grandparents, keeping active, and taking care of their aging
parents while also staying on top of their own health.
Because of this, it is especially difficult to segment this group and it is a fatal mistake to view this generation as a single, monolithic entity with lockstep needs and purchasing patterns.
Baby Boomers are not interchangeable consumers, and age alone is a stereotypical, overly simplistic way to view this generation.
In fact, in a recent study by the University of Michigan, 82% of adults over 50—which includes Baby Boomers, as well as older members of Gen X—said they regularly experienced ageism in their day-to-day lives. This includes others assuming they aren’t tech-literate, hearing jokes about old age, or even being told that aging adults are unattractive or undesirable. The representation of folks over 50 in media perpetuates this. Only 15% of online images in ads and other social media feature adults over 50, even though this segment makes up 46% of U.S. adults.
The retailers who want to grow in this new era must gain a much better understanding of the needs of the Baby Boomer consumer and target their products, tailor their messaging, and adjust the in-store experience accordingly.
To deliver the right message to these consumers, retailers need to first learn the subtle nuances that define each segment within this generation. Only then can retailers successfully connect with them, build lasting relationships, and develop loyal customers. However, to do this effectively and accurately, you need to obtain granular-level insights into who your customers are so you can identify patterns of behavior among the specific groups that make up the Baby Boomer generation; how they differ in particular regions of the country; and which corporate messaging, promotions, and pricing will have the biggest impact on each group.