"Ten Myths About the 50+ Market"
Lee Marc Stein Newsletter, January 2005
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When you think about the population that is 50 or older, what images come to mind? Are you thinking of a grey-haired person in a rocking chair on the porch? Someone who is ill or infirm? Someone who has to be very careful about his money because he is living on a fixed income?
If you are marketing products or services to this market, your images are likely to affect how you approach it and how you reach out to it. If your images are inaccurate, you will turn off more people than you will turn on. Here are ten myths about the 50-plus market that you should avoid.
1. The number of people 50 or older is too small to consider.
There are more than 80 million people who are 50 and over, and 36 million are at least 65. Four million Baby Boomers are joining these ranks each year. While life expectancy is about 77, someone who is 75 can expect to live another 11 or 12 years. By 2030 there will be nearly 9 million Americans 85 or older.
2. People who are 50 or older are a homogeneous group who can be reached with one kind of message.
In fact, there are three distinct segments, as defined by The Second Half, a consulting company that focuses on the 50-plus population.
- Baby Boomers-full of confidence and a desire to enjoy the world and all it has to offer
- Silent Generation-mostly retired, more conservative, but still looking to enjoy life for as long as possible
- GI Generation-want to live independently as long as possible
3. Once people retire, they have no money to spend on anything beyond basic necessities.
Today's 50-plus population is the wealthiest in history. While fewer people have defined pension plans these days, many more have private investments, IRAs, and other kinds of retirement accounts. Moreover, the Baby Boom generation-and part of the Silent generation-are poised to inherit anywhere from $180 billion to $11 trillion (depending on market conditions and end-of-life costs).
4. Retirement is a time to stop working, to play golf, and just relax.
Baby Boomers are rewriting the definition of retirement. Many will work beyond the age of 65, often starting their own businesses. Some will retire and work part-time. Others will indulge a hobby, or write that book they've been wanting to do for so long. Retirement is now seen as a time to try new things, or to engage in long-postponed projects or activities.
5. Older adults are very brand loyal, and it's hardly worth it to market a new brand to them.
Baby Boomers are the original cynics. They grew up flaunting authority and doing things their own way. "New" is welcome term-as long as it is followed by "better." A 2000 Roper study found that only 35% of people aged 50 and over "did not experiment with brands once they found one they liked," a 7-percentage point drop from a similar study in 1997.
6. Older people are mostly concerned about their health.
Today's 50+ population-especially Baby Boomers-are more concerned about wellness than illness. They are committed to staying as healthy as possible so they can enjoy all the other things in their lives-and in the world. In presenting health care products and services, they want to see how it will enhance their lives, rather than how it will forestall death.
7. Older adults can barely work a VCR, much less a DVD or computer.
Baby Boomers were building their careers and professional lives when computers and other technologies emerged. They tend to be competitive and adventurous, and want to act and live younger. They are NOT techno-aversive. Silents and even the GI Generation are spurred to use computers and e-mail in order to communicate with their children and grandchildren, who tend to be more geographically dispersed than they used to be.
8. People 50 and over are not buying real estate, home furnishings or similar products.
Once the children are grown and have moved out, many 50+ householders decide it is time to fix up and redecorate. No longer do they need child-proof homes; they can and do spend to have the homes they always wanted. Many are buying vacation homes, or an apartment in Paris. Their first mortgages are paid off (or are very low), and it's "time for me." Even the older segments, who may be relocating to another state, a smaller housing unit, or an independent living facility are buying new furniture as if they were newlyweds.
9. Older people prefer cruises for their vacations.
When it comes to leisure activities, Baby Boomers will not be satisfied to sit on a deck chair for a week or two. Having virtually invented the youth culture, they want to explore new places and have adventures. And they have the disposable income to do it.
10. The 50+ market is off-target for children's products.
The grandparent market today is estimated at more than $30 billion annually, with 70 million grandparents spending nearly $500 per year on each grandchild. Not only are they buying furniture, apparel, and toys, they are investing for their grandchildren's education and taking them on vacation. It gives new meaning to the old saw: "If Mom says no, ask Grandma."
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