Businesses spend quite a bit of time trying to understand what’s next…from the workplace demands of the next generation of superstars to the buying habits of the famed “18-24 target market” of potential brand loyalists. However, demographics tell us that “what’s next” may well be what just was. That is, the power of last generation’s new target market—Baby Boomers—is still the most powerful consumer market, and the older Gen Xers are right on their tails. Businesses need to keep up.
By 2017, nearly half the US population will be 50 or older. They will have the more purchasing power than any other generation has had at this age, and they will want to use it in ways that are not “old.” This is the message in a recent Financial Times article, Why companies are failing to cash in on flood of aging Baby Boomers worth US$15-trillion.
Much has been written about how Baby Boomers are eschewing the traditional retired life, whether that means working longer to make ends meet, launching into a second career to fulfill one’s dreams or moving to the city instead of the retirement community, Boomers are doing things differently and companies need to figure out what that means from a consumer standpoint. And they need to do it fast.
When creating new products for this “new” market, or selling existing products/services to this group after many years, it is important to remember that while the fundamentals of the generation may be the same, they are still evolving and growing. You may have always sold to Baby Boomers, but do you know them now?
The FT article reminds us “When it comes to aging, myths abound. Here’s one: Older consumers buy the same brands they’ve always bought, so why bother catering to them? ‘If that theory was true, I would drive a Chevy Impala and wear English Leather,’ said (gerontologist Ken) Dychtwald, 63.” Not that there’s anything wrong with that.
Here’s an interesting new trend – Baby Boomers are beginning to settle down in the big city. According to a report in the Seattle Times, more and more Baby Boomers are walking away from the homes and yards in the suburbs to spend their empty-nester and retirement (or semi-retirement) years in the metro bustle that had once been the playground of the fresh-from-college crowd.
It makes a lot of sense – smaller spaces, less time and money on maintenance, no worries about school districts – and it creates some interesting opportunities for employers and businesses. Besides the overall real estate impact, these Boomers are typically returning to the city looking for an active lifestyle. This can mean new target audiences for restaurants, shops and galleries. It can also mean the potential to retain knowledgeable workers longer – reduced commutes create more work-life balance, and close proximity to the office may encourage older workers to stay on in consulting roles as a semi-retirement solution.
What I find most fascinating about this trend is that it underscores the strange truth that Millennials and Boomers – despite being a full generation apart and frequently rolling their eyes at one another – have some very strong similarities. What the Boomers and the Millennials both want right now is more individuality, more excitement and more freedom. It will be interesting to see if they can stand being neighbors.
I’ve posted about this phenomenon before, and talked about it with clients over the years, but still people have a hard time believing it is true. Yes, I’m talking about parents getting all up in their grown children’s employment business. The topic is back thanks to an article in Huffington Post Business “Millennials Now Bring Their Parents along to Job Interviews.”
HuffPost is reporting out statistics that say 3% of job seekers have their parents sit in on an interview – a number that seems statistically insignificant until you realize that until a few years ago not only would the number be 0%, the question itself would not even make it to the survey.
There is one environment where this trend makes solid sense – the US Army. In fact, the Army has been recruiting parents and children together for several years now, and it makes good sense. A soldier is more successful if he or she has full support back at home. Convincing parents that the army is a great career for their children is a sound approach, because the job is putting the child’s life at risk. The survey findings above were not Army-exclusive, however, so I must remind our younger job seekers and their parents to stop. Just stop.
You can barely pick up the paper these days without hearing about the 10,000 Baby Boomers who are reaching retirement age every day and how they will a) be a drain on the social security system and b) not “go gently into that good night.” Yet whether it is for the flexibility to visit with grandchildren and pursue travel dreams, the need for added income, or simply the desire not to be seen as past their prime, more and more Boomers are taking post-retirement careers.
Boomers that achieved executive status often return to the workforce as consultants – working flexible hours on focused projects of special interest or where their retained knowledge is especially helpful. But more and more Boomers are shifting gears completely, focusing on post-retirement careers that feed into a creative desire or relate to hobbies and personal interests outside of an individual’s primary career. Could it be that the generation that told its children to “go out and find something that makes you happy” is taking its own advice?
A recent article in the Plattsburg Press Republican speaks to this phenomena, which has been dubbed “encore careers.” The University of Hartford has a program, Encore! Hartford, specifically geared toward helping individuals find their encore careers.
If Boomers don’t really want to – or can’t fully – retire, and Xers and Millennials are seeking careers that are more about happiness than climbing the corporate ladder, businesses that figure out how to let employees find passion in their work will surge to the forefront. This doesn’t have to mean small, entrepreneurial companies are the only way to find loyalty and engagement, but it does mean that corporations will have to work harder to be the places of business where today’s employees want to work.
Target marketing based on age groupings is nothing new – advertising companies have been doing it for ages. However, this approach by Heineken struck me as particularly interesting from a generational perspective. The Heineken Ideas Brewery is in itself a great concept for the younger generations as it is allows consumers to share thoughts directly with the brewery and plays into the Xer and Millennial desire to be recognized as individuals with individual wants.
Apparently the company wasn’t satisfied with its sales to the Boomer generation and decided to ask consumers their ideas for new products that would attract this sought-after demographic. The top six ideas are outlined here (note: not the official list) and are somewhat fascinating in what they say about people’s perceptions of Boomers.
Whether this product development crowd surfing yields a viable Boomer-targeted brew is still to be seen, but it is an interesting combination of a communication tactic typically targeting younger generations being used to specifically target older generations. If you read the blog post, results are mixed, but you have to hand it to the folks at Heineken for taking a shot.
Whether it is due to fears about the economy, finally getting tired of the corporate grind, or simply a desire to stay busy in retirement, it seems more and more Baby Boomers are putting on the entrepreneur’s cap. In fact, the Rapid City Journal recently profiled a Boomer entrepreneur whose bright idea for business is a support service company specifically for helping Boomer entrepreneurs get their businesses off the ground. Talk about niche. And yet he already has 50 businesses signed up.
What does this trend mean to your business? Are you losing experienced professionals because they are ready to do something that is more personal and meaningful? If so, consider how you can adapt their role within your organization to become more flexible or collaborative. Many established Boomer professionals are happy to shift to a consulting role, for example, with more flexibility to work on special projects and with flexible schedules. They get to maintain their status as knowledgeable experts while rolling up their sleeves to work on something new and creative.
If keeping Boomers is not your challenge, perhaps this trend toward entrepreneurialism is an opportunity for your company to serve an unmet need. Like the gentlemen in Rapid City, is there something your business can offer that will help Boomer entrepreneurs quickly establish and grow their business? Most entrepreneurs are good at what they do – the idea behind their company – but not necessarily at building and running a company in general. From taxes to technology, marketing to payroll, consider where your business can provide added value. Then keep your ears open for Boomers talking about side businesses that may actually be more than hobby.
For years, economists and generational experts have been talking about the business impact that will come as Baby Boomers retire in droves. Entire industries have emerged to handle the needs of this enormous generation as it ages out of the work world and into some semblance of retirement – be that semi-retired or active senior living or long term care. But Boomers are affecting established industries as well.
A recent story on NBC News highlights how restaurateurs are catering to the Boomer clientele. When we think of restaurants and other B2C business, the trends have historically shifted toward the youth. What is up-and-coming? How can we attract young adults with their fresh paychecks and establish them as loyal customers for life?
Turns out the older generations are tired of the kitchen while the younger ones are just learning to appreciate the simple life, so the target audience changes. With Boomers holding the bulk of the purchasing power in America today, however, it seems more and more restaurants are shifting gears and considering how to appeal to more sophisticated – or simply older – tastes. This blogger, however, seems to think that Gen X should be getting some extra TLC.
What generational stereotypes or habits are you holding onto? Are they getting in the way of opportunity? Think about it.
I work with a good deal of financial advisory firms, many of which are grappling with how to attract and engage younger investors to maintain a strong continuity of client base. And while this is increasingly important, it is also worth noting that the financial advisory needs of the Baby Boomers are not going away. In fact, they are likely to grow.
Relationship-oriented service businesses should not assume that all Boomers have established relationships with providers. An article in U-T San Diego quotes a 2013 study by the PNC Financial Services Group states that only 43% of Boomers surveyed have established or are planning to establish a financial plan. That means 57% of Boomers – the group that holds the majority of wealth in the nation – are likely in need of one, whether they admit it or not.
While financial advisors are out wooing younger investors who don’t think they need advisory services yet, they should also be educating older prospective clients who may be significant financial milestones in the very near future. The good news is that most financial advisors already know how to communicate with Boomers, the difference with this group of potentially hesitant clients is that you’ll need to do some educating and convincing that the need is there.
I’ve long recommended that employees connect younger employees with the elder statesmen (and women) of the company – either in addition to or instead of the traditional “next level up” mentor system. From a generational perspective, it seems that this youngest generation in the workforce has a sense of idealism that resonates with older generations – and is wholly lost on the Gen Xers in between.
At MoSoConf – Canada’s mobile and social conference held in Saskatchewan last month – marketing exec Michael Douma delivered the keynote address with a speech titled “Thinking Like a Millennial in an Industry of Boomers.” Douma recognizes the seemingly illogical gap between the Millennials and Xers, focusing on some basic differences in how each generation responds to marketing.
Why is this important?
First, while the generations exist on a continuum the norms and behaviors they exhibit tend to have fairly clear breaking points. Yes, there are Xers who have Boomer habits, and Millennials who behave like Xers, but on the whole, the generations have somewhat predictable and distinct patterns. Contrary to logic, an “older Millennial” is not automatically more like a “young Xer.”
Second, the conversation is never just about the norms of a generation – it should be about generational norms in relation to one another. This is why the frustrations of a Gen X manager and Boomer manager trying to develop the same Millennial worker will be different. The similarities and disparities between any two generations is distinct to that generational match up.
Progress comes when we understand both our own habits and those of the generations we are trying to lead.
A lot of HR time is spent figuring out how to attract the best and brightest young talent – what are the perks and expectations that can bring the next workforce stars to your business? The AARP, however, wanted to know who was doing a good job attracting the bright, experienced talent that is already available in the Baby Boomer generation. In their recent ranking of the Best Employers for Workers over 50, the National Institutes for Health topped the list.
The NIH is joined by four more health care companies in the top five. The AARP attributes the dominance of health care companies on the list to a focus on empathy (the ability of the older generations to understand the needs of an older clientele), the advanced skills of more experienced workers, and the industry’s appreciation that that employees want to live increasingly fuller lives – ones with more flexibility and benefits, an area where health care companies tend to be more progressive.
Of course, the flexibility and benefits prevalent in health care can also be attractive to employees throughout the generational spectrum. In addition, younger minds bring some interesting innovation and fresh perspective. Regardless, the AARP list demonstrates that understanding employees’ core values and changing needs can help a company create an environment where employee engagement and loyalty are more easily achieved. It is this type of approach that can help your business attract and retain employees.