Marketing Across Multiple Generations
Our clients are always asking us for advice on how to extend their brand and message to different generations of consumers. We receny compiled this report for one of them to help explain generational consumer behavior and how to target them.
Behaviors across five generations of consumers showing how those generational influences affect how they purchase products.
Generational Marketing is defined as the approach to product communication and marketing that recognizes generation as archetypes.
Ages 2 to 17 are Generation Z
Ages 18 to 35 are described as Millennials
Ages 36 to 51 are Generation Xers
Ages 52 to 70 are considered Baby Boomers
Ages 71 and older are The Silent Generation
This document highlights how each generational group searches for products, how they want to buy a product, and what they expect from the companies with which they do business.
1. Baby Boomers continue to be a primary target audience
While millennials have dominated headlines in recent years, baby boomers (those born between 1946 and 1964) have continued to dominate consumer spending in the U.S.
In fact, consumers over 50 now account for more than half of all U.S. spending. They are also responsible for more spending growth over the past decade than any other generation, including the coveted millennials.
As a group, this over-50 crowd should continue to be a major force in U.S. consumer spending, especially as those over 60 years old drive growth over the next five to 10 years, according to Visa Business and Economic Insights.
This is happening for two reasons: demographics - there are simply more consumers over 60 than there were 10 years ago - and behavior. Baby boomers, compared to generations that preceded them, are retiring later, holding on to more debt, and maintaining budgets for travel and other discretionary treats.
While the share of spending among younger consumers is expected to decline over the next 10 years, older consumers will gradually spend more with those aged 60+ reaching a 33 percent share of aggregate spending by 2025.
2. Gen Xers are the next most valuable group to be targeted.
At A Glance:
What Makes Each Generation Unique
Ages 2-17, Gen Z
While their pockets are small, their influence is mighty. 93% of parents say their children influence family spending and household purchases.
Social media has the largest impact on influencing purchase decisions for Gen Z. With 80% of purchases by this generation influenced by social media, the channels making the biggest impact are: Instagram (44%), Snapchat (21%) and YouTube (32%). The youngest cohort also responds well to social media influencers and user-generated content.
Strategies and Tactics for Marketing to Gen Z
Increased use of Social Media, Video content
Ages 18-35, Millennials
They are poised to be - but still not quite - the nation’s biggest spenders. Consequently, millennials often dominate media and conversations around strategy and marketing.
Millennials are starting to come into their prime spending years. Millennials have settled down with careers, homes, and families. Their buying power is undeniable: By 2030, the collective annual income of Millennials worldwide is expected to exceed 4 Trillion Dollars.
They are the first digitally native generation and have overtaken Baby Boomers as the largest adult population in America.
Millennials are the most ethnically and racially diverse generation, with 19% being Hispanic, 14% African-American and 5% Asian.
This generation is different, and so brands must interact with them as a unique consumer to draw their attention and business.
Millennial Consumer Characteristics
· The majority of these young people have less than $1,000 in their savings accounts, and a significant number have no savings at all.
· They have less credit card debt and more than 65% of millennials don’t have a credit card at all.
· Millennials consider social responsibility and environmental friendliness when considering their purchases. They typically choose to either follow their own instincts or go along with their peers but are wary of financial advice given by parents or professionals in the field.
· They also prefer personal connections with those who reflect their highly held values of trust, authenticity, and choice.
· When shopping, Millennials focus on discounts. They value price over recommendations, the brand’s reputation, and even product quality.
· They follow brands online just for discount opportunities. 66% of millennials would switch brands if offered at least a 30% discount, and only a third see a brand to consider trends or product updates.
· 82% of Millennials say word of mouth (testimonials) is a key factor in buying decisions.
· Millennials spend more on comforts and conveniences and will pay a premium for luxury and popular items.
· Millennials spend money recreationally. Shopping is a hobby.
· 50% of millennials say that positive customer service experience is a factor in their loyalty to brands.
· Millennials are unresponsive to traditional marketing tactics. This generation decides where to eat based on Instagram pictures, chooses hair stylists from Facebook, and has their groceries delivered.
· 68% report that they won’t make a major decision until they have discussed it with friends - everything from what neighborhood to live in and how to find it, to where to go on a first date.
· They are typically “in a hurry” and lead a “rushed” existence.
Strategies and Tactics for Marketing to Millennials
Evaluate how valuable the demographic is to your business, and budget proportionally.
Use Testimonials and Reviews; Provide discounts; Tell Stories that focus on luxury, price, and responsibly manufactured products.
Ages 36 to 51, Generation Xers
Sandwiched between the Boomers and Millennials, Gen X is often referred to the “middle child” generation due to its reputation of being “forgotten” by marketing specialists.
Because of this, there is less market research into their spending habits compared to those of Boomers and Millennials. HOWEVER, the spending power of this generation can’t be ignored: Gen Xers produce 31 percent of total US income despite representing a mere 25 percent of the population.
Millennials Consumer Characteristics
· Gen Xers tend to shop more conservatively than other generations.
· They are more likely to buy products that are unique and high-quality.
· They’re more skeptical about marketing tactics and gimmicks, which means they won’t be won with flashy advertising gimmicks.
· They seek practicality and proof of performance.
· Gen X prefers honest and clear product and marketing messages that outline an obvious path-to-purchase.
· Gen X is more likely to conduct online research at home and then shop in person.
· While most are very active on social media, they are much more influenced by email marketing campaigns.
· They are typically “in a hurry” and lead a “rushed” existence.
Strategies and Tactics for Marketing to Gen X
Email; Maintain a Strong Digital Presence; Social Media.
Use Testimonials and Reviews; Tell Stories of quality and unique features.
Ages 52 - 70 Baby Boomers
Baby boomers still outspend millennials. In fact, VISA predicts that consumers age 60+ will continue to drive U.S. spending for the next five to 10 years.
Industry forecasts show that Gen X and millennials are important consumer targets and should not be forsaken - but the strongest future growth potential in spending lies firmly with baby boomers.
Baby Boomer Consumer Characteristics
· The over-50 crowd accounts for 50% of all consumer expenditures, but marketers are only spending as around 10% of their budgets on the group.
· Boomers are buying more online: they’re making more purchases via computers, smartphones and other devices, suggesting they are visiting traditional stores less frequently.
· They seek “top shelf” products and service. Boomers are more likely going to be okay with splurging on themselves.
· Baby boomers aren’t as pressed for time as their younger counterparts. They have more time to do research and compare products.
· They are focused on value for their money and product quality.
· The group also prioritizes products that are reliable, fairly priced, and budget friendly.
· Older generations prefer talking face-to-face or on the phone. You can frustrate them by trying to communicate with them in a method they do not like, such as email or text.
Strategies and Tactics for Marketing to Baby Boomers
Messaging across all media that focuses on product craftsmanship, reliability, and guarantees; tell them why the items are worthwhile buys.
Lean more on traditional media, but do not dismiss social media or a digital presence.
Ages 70+ Silent Generation
Silent Generation Consumer Characteristics
· Despite a prevalent aversion to technology, they are buying more online - suggesting they are visiting traditional stores less frequently.
· Loyal to brands, respect authority and patriotism.
· The have – and respect – a strong work ethic.
· Older generations are value hunters.
· They aren’t as pressed for time as their younger counterparts. They have more time to do research and compare products.
· They often have less money to spend and seek discounts. They feel they have “earned” a “better price.” They focus on value for their money and product quality.
· They read the full text description of a product, relying on the written word more than images.
· Older generations prefer talking face-to-face or on the phone. You can easily frustrate them by trying to communicate with them in a method they do not like, such as email or text.