Boomers aren’t done. We’re living longer and we’re living healthier, and the Boomer population growth rate isn’t going to peak until 2026. The Millennials are not going to grow in numbers...
Just look at the numbers: The demographic covers 77 million people in the U.S. alone; an American turns 50 every seven seconds, which is equivalent to more than 12,500 people every day, and the senior age group is, for the first time, the largest in terms of size and percent of the population — and by the year 2015, those age 50 and up will account for 45 percent of the U.S. population, according to statistics from the U.S. Census Bureau and AARP.
The amount of money this age group controls is staggering:
• The 55-plus age group controls over three-fourths of America’s wealth, according to the International Council of Shopping Centers. Baby Boomers outspend other generations by approximately $400 billion each year on consumer goods and services, according to the U.S. Government Consumer Expenditure Survey.
• Baby Boomers account for about $230 billion, or 55 percent, of consumer packaged goods sales, according to Nielsen.
• Boomers outspend younger adults online 2 to 1 on a per-capita basis, according to Forrester Research.
• Women over 50 spend $21 billion on clothes annually, according to the U.S. Government Consumer Expenditure Survey.
With all that wealth, why are so many brands and retailers ignoring them to focus on Millennials — the children of the Boomers who are ages 18 to 33?
“There’s no question that brands tend to focus on young people,” said Tim Calkins, clinical professor of marketing at the Kellogg School of Management at Northwestern University. “Fashion is so much about the new and the young. There are a huge number of people who have a lot of money to spend, but the brands aren’t talking to them directly. Brands sometime get nervous that if they reach out to middle-aged people, people will think they’re a middle-aged brand.”
So brands aggressively target young people — even though they don’t have significant disposable income. “It’s one of the great branding puzzles,” he said. “How do you reach Baby Boomers without seeming like an aging brand? The sweet spot is to feel like a young brand, while at the same time being relevant for a Baby Boomer target. But it’s a real challenge.”
All industries, including fashion, wrestle with this problem, but Calkins believes it’s more acute when it comes to fashion. Undoubtedly, there’s a huge opportunity to target the Baby Boomer segment, who actively use the Internet and engage insocial media. “The challenge is you have to market to the Baby Boomer segment a little differently than the younger crowd. The Baby Boomer grew up before digital communications really hit fully,” he said, adding brands can’t rely solely on digital communication. Boomers are still watching television, but they’re doing it via cable. Younger people, he said, are watching television too, but often on a smartphone or tablet. “In a way, one of the good things about the media world right now is there are so many different ways to reach people. It’s more and more possible to target different messages to different groups,” said Calkins.
Boomers represent an interesting target for various reasons, according to a Ledbury Research report in London. They were brought up with consumerism during the post-World War II period characterized by the availability of products and increased financial well-being. This generation has “a higher purchasing power than their younger counterparts; and especially in established markets like the U.K. or the U.S., they hold the vast majority of the wealth,” the study reported. They also appreciate high-quality products and have the time and desire to enjoy life more than their younger generations.
“This makes them a potentially profitable group not only for the fashion industry but also for other high-end products such as luxury travel and accommodation or passion investments like art or fine wine,” according to the study.
The report noted that in a country like Japan, where more than one in four individuals is age 65 or older, companies are trying to exploit the aging population by creating campaigns as well as shopping facilities specifically targeted at this generation.
Asked whether he believes Boomers are being underserved by retailers, Marshal Cohen, chief industry analyst at NPD Group, said, “I have a one-word answer for that: Yes. They’re ignoring them and they’re absolutely out of their minds. With so much attention being paid to Millennials, and in some cases, understandably so because it is the future of retail, [but] they don’t have the discretionary power that we all would love them to have.
“Boomers aren’t done. We’re living longer and we’re living healthier, and the Boomer population growth rate isn’t going to peak until 2026. The Millennials are not going to grow in numbers,” added Cohen. He believes retailers and companies are ignoring Boomers because of their fascination with the young.
“I understand there’s an old adage that you always market younger, and that’s why you see beauty ads have 14-year-olds in them when they want to sell the 40-year-old consumer.”
When he teaches a class to Millennials, he always asks, “What’s your number-one concern?” The answer is always getting a job and being so far in debt. “If a student has a loan, he will be paying the loan off for 10 years, if they’re lucky to get a job and pay it off in 10 years. That doesn’t allow them to spend a lot of money, compared to the Boomer, who at that age had a lot more discretionary income. The average Millennial has $43,000 worth of debt, between car loans, credit-card loans and student loans. They’re already behind the eight ball,” he said.
Cohen believes brands are operating on old theories of how to market. In today’s world, if he were a retailer or a brand, “I would be trying to reach everybody I can possibly reach, without putting a singular focus unless I was micro-marketing to a singular audience.” He recalled early Ralph Lauren ads that featured three generations of people. He said they were the only company that consistently did that and still does so today. “They recognize the importance of including all generations for the product and not having a singular message with a singular ad, with a singular focus,” said Cohen.
Other companies that do a good job marketing to Boomers include Saks Fifth Avenue because it departmentalizes it; J. Jill; White House|Black Market, and Christopher & Banks, which has a retail, outlet and online business, said Cohen.
Experts believe that brands do the Boomer segment a disservice by trying to pigeonhole their fashion tastes because it’s a huge age range, between 50 and 68 years old.
“Balancing the offering in terms of lifestyle, taste level, fit and proportion will capture greater Boomer wallet share in today’s environment than focusing on the age-related demographics of this customer,” said Lori Holliday Banks, director of research at TOBE, a New York-based think tank for the fashion, media and entertainment industries. “Brands need to recognize that a Baby Boomer is not focusing on her age as the deciding factor that triggers a purchase. There are other variables that influence her fashion choices much more significantly than her age.”
With so many Boomers being in better shape these days and working out, they are able to wear more contemporary and designer brands than their mothers might have worn 30 years ago. That said, brands such as NYDJ, Eileen Fisher, Lafayette 148, Elie Tahari, INC, Jones New York, Vince Camuto and Tory Burch are known for offering a comfortable fit and have a large Baby Boomer following. Seven For All Mankind is launching its first subbrand to appeal to older female shoppers called Jen7, which is designed to reach women who might have bought jeans from Seven For All Mankind’s early collections but stopped due to changes in their lifestyles. In addition, the whole fitness boom has led to an increase in sales in active sportswear pieces, including yoga, knit and pull-on pants, and appeal to all demographics, especially Boomers.
The common lament among Boomers is that clothes are too short and too tight, lack sleeves, and women are challenged to find things that are age-appropriate and fit properly. At the same time, Boomers appear to be rejecting clothing that is too mature and traditional, while looking to be fashionable and modern. Retailers that long catered to the Boomer consumer, such as Talbots, Coldwater Creek (which went bankrupt) and Chico’s have faced challenges because they failed to keep up with fashion trends, sticking to their “missy” formula.
It isn’t only the spending power of Boomers buying for themselves, however. They also shop a lot for others.
Paco Underhill, author of “What Women Want: The Global Market Turns Female Friendly” and chief executive officer of Envirosell, a retail-focused consumer-behavior research and consulting firm, acknowledged that Baby Boomers are spending less on themselves and more on everybody else. “They are the sandwich generation, particularly the women who are taking care of their teenage children and those who haven’t left the nest yet, and aging parents,” he said. He added that these women are definitely buying, but not necessarily for themselves. They’re buying for their mothers, children and grandchildren.
He said that while stores such as Chico’s, White House|Black Market, Soma and J. Jill focus on Boomers, ad agencies and fashion firms aren’t marketing to them. “You walk into a modernadvertising agency or a modern fashion company, there’s hardly anyone over the age of 40,” he said. “Virtually everyone’s saying ‘It isn’t fun to market to my mother. I want to market to my peers or market to my younger sister,’” said Underhill.
Peter Hubbell, founder and ceo of BoomAgers, global experts on the Baby Boom generation and the author of “The Old Rush: Marketing for Gold in the Age of Aging,” called the 80 million Boomers “America’s most valuable generation.”
“They’re valuable because they’ve got the discretionary, disposable income to spend on things like fashion which Gen Y doesn’t have. They’re also valuable because of their sheer size. Whenever they’ve decided to embrace something, they’ve created potent trends,” said Hubbell. He said that it’s well documented that blue jeans, which are the most enduring global fashion concept, was a successful trend generated by Boomers embracing James Dean and looking for a statement of proletarian rebellion in the Sixties.
For years, marketers have targeted 18- to 49-year-olds. This is the year that the last of the Baby Boomers turned 50. “This massive cohort has just aged out of 18-to-49, and taken all of their wealth with them. The problem is that industries, such as fashion, are still of the belief that 18-to-49, or for fashion, I’m guessing 18-to-34, is the sweet spot. I’d ask you, because I’ve arbitrarily aged out of the 18-to-49 and became 50, does that mean suddenly that I’m style challenged?” said Hubbell.
Certain food brands, such as yogurt and fiber cereals, have figured out how to reach Boomers, but “everybody has been slow to adapt and change. They don’t know how to take both feet out of 18-to-49,” he said. Boomers aren’t looking for the fountain of youth because they don’t think they’re old. The average boomer (50 to 68) defines old age as 72. The average mortality age in the U.S. is 79, so Boomers are basically saying they’re not going to be old until seven years before they die, Hubbell said.
With respect to fashion, Boomers aren’t looking to turn back time or to look or feel young. They want to look and feel current. He doesn’t feel stores are paying much attention to them. “If you look at a brand like Tory Burch, you’ve got every generation of woman out there today embracing what Tory Burch is about. I think brands like Tory Burch stumbled into it,” he said.
Fashion brands aren’t designing clothes for the Boomers, nor marketing to them, he said. “I don’t think they need to make clothing for this group. They need to market clothing to this group in a way that says, ‘We love you, we appreciate you. We understand you and we have something for you.’”
There’s no question Boomers are massive purchasers, as well as users of the Internet. “They don’t want to feel like they have fallen behind the times. The world would have us believe that ‘I don’t care about how I look anymore because I’m 50 years old, and I’m just going to wear those same old frumpy things that I’ve always owned.’ And it’s just not true. If anything, I’m trying to overcompensate for the fact that I’m changing,” he said.
As a general rule, Boomers are highly experiential. They want to go to a restaurant and not only want to eat good food, they want the dining experience. They want to go to a high-concept retailer and spend time there, he said. “I don’t believe that Gen Y has the money or the interest in going to a store and shopping. They’re a transactional generation,” contended Hubbell.
Observers believe beauty companies are more willing than fashion firms to target the Boomer. But Hubbell thinks even beauty brands aren’t speaking to Boomers properly. The Boomer generation doesn’t want to hear about antiaging products, he said. What they really want to do is go into Sephora and have the salesperson be as interested in helping them as the Gen Y customer, he said. They want the newest cosmetics, technologies and formulas. “If all you’re going to do is walk me down to the end of the aisle to the antiaging serums, you’ve pissed me off. We work with clients and you have to truly be in touch with this generation’s feelings and your language has to be very natural and authentic,” he said.
He believes certain advertisers are speaking the right language. Early on, he believed Target was addressing this generation properly and now it is Apple’s Genius Bar. “They totally get it. It’s a brilliant Boomer concept. Instead of saying, ‘You old people don’t understand technology and we can help’ it’s ‘come add to your genius abilities.’”
Hubbell believes a brand needs to speak to Boomers with “pithy authenticity.” By definition, Boomers have been on the receiving end of more marketing than any other generational cohort out there. It doesn’t mean they’re cynical and untrusting. It just means they’ve seen it before and heard it before and are a little fatigued about it. “So don’t come along and say you’ve got an antiaging serum for me. Tell me a story, speak my language, demonstrate that you understand me,” he said.
When he gives lectures, he’ll ask how many people in the audience are Boomers and 65 percent of the hands go up. When he then asks, “How many of you feel the vast majority of advertisers today understands you, respects you and delights you? Show of hands?” None.
“Clearly, that’s asking you a lot for advertising. Let me re-phrase it: ‘How many believe the vast majority of advertising out there at least respects you?’ That’s a massive miss. Marketing is all about love and respect. When you balance the two of those, that’s when it’s magical. Boomers are saying the vast majority don’t respect me anymore,” said Hubbell.
Interestingly, a handful of 60-plus models have been appearing in ad campaigns and magazine shoots lately that would normally go to women one-third their age. Jessica Lange, 65, is the new face of Marc Jacobs Beauty, while Charlotte Rampling, 68, features in the Nars campaign. Tom Ford cast Pat Cleveland, 61, for a sexy fashion shoot alongside a naked Conrad Bromfield, a South African model in his early 20s, for Numero Russia, while Jackie O’Shaughnessy, 62, recently posed for lingerie and yoga apparel ads for American Apparel.
“What we’re going to give visually in terms of the print and image is not what you should expect, but what inspires me, and that may come from different places. So we used Jessica [Lange],” said Marc Jacobs in discussing the campaign.
While stores such as Macy’s, Lord & Taylor, Ann Inc. and Nordstrom declined to be interviewed for the story, a few acknowledged that Boomers are an important demographic to them, as are all demographics.
Kathleen Ruiz, senior vice president, marketing and public relations at Saks Fifth Avenue, said, “A big portion of our core customers belong to this group. We are very careful to ensure that we carry the right merchandise for this demographic and create an elevated shopping environment for them. We see a lot of these customers work closely with our Fifth Avenue Clubs. Through the Clubs, they develop close relationships with associates and work with them on wardrobing services.
Wanda Gierhart, chief marketing officer of Neiman Marcus Group, said, “We market to a lifestyle, not really an age group.”
She said Neiman’s obviously does research across its customer base and has found that the core of its customers love fashion and are luxury-goods purchasers. “All of their habits are not so far apart in what they need and how we can service them. To us, it’s more of a lifestyle angle. We like to make it anywhere, anytime, any device. I think that’s pertinent for a Millennial or a Baby Boomer,” she said.
Asked if the Baby Boomer has certain fashion requirements, such as long sleeves or longer dress or skirt lengths, she said Neiman’s doesn’t look at it from an age, but from a customer lifestyle.
When it comes to its advertising and their catalogues, Neiman’s projects a certain style and image. “It’s high fashion, we’re not trying to portray every person who could possibly walk in the door. The common thread is our customer loves fashion. We need to be reflective of that,” she said.
At the mainstream level, J. Jill, the 232-unit retailer based in Quincy, Mass., targets the Boomer. The company’s sweet spot is 45 to 64. “We find our customer is looking for simple and comfortable,” said Chris Gayton, the retailer’s vice president of brand marketing. “She really wants something that can be stylish and on trend, but never trendy. And she’s really talking about flexibility, in that she wants her wardrobe to be able to embrace whatever the day throws at her.”
In its advertising, J. Jill will show women who are appropriate for the company as a brand. “It could be a little aspirational. It’s all about diversity. Making sure she recognizes something within the images that we put that relate to her,” he said. “We’ve been in business for a long time and the core values of the company have not really changed. Our core customer has always been Baby Boomers, and we designed things around her unique lifestyle. She doesn’t have to dress as if she’s going to an office. Seventy percent of our customers do work or volunteer outside the home,” he said.
About 60 percent of its business comes from J. Jill’s retail stores and the remainder comes from the catalogue and online channel. “The online channel has continued to grow significantly. It’s growing in terms of the way the Boomer is adapting to technology, whether it’s social media or mobile technology,” according to Gayton, adding J. Jill continues to have double-digit growth in e-commerce year over year.
According to Employee Benefit Research Institute, people age 50 to 74 spend 12 percent of their income on food, 9 percent on entertainment and 3 percent on clothing. One has to wonder whether it’s worth apparel companies paying attention to them.
That poses a dilemma. “If you’re a Boomer, is it that you don’t need as much anymore, or is there not enough out there for me?” asked Wendy Liebmann, ceo and chief shopper at WSL Strategic Retail. She believes that many Boomers feel their needs aren’t being met. “If you think not of the haute couture brands, but some of the larger or more specialty oriented fashion brands, they are very focused on younger, shorter, tighter and less forgiving. If you’re an older shopper who still wants to be fashionable, it doesn’t work. Is it the chicken or the egg? Is it harder for a Boomer shopper to buy, or they’re not interested in buying, they’re just spending their money on other things?” said Liebmann.
She recalled a few years ago that somebody said to Eileen Fisher, “This is a brand for Boomers,” and the designer said, “‘No, it is not.’ She didn’t mean ‘no it’s not,” but she meant if the product you’re selling is appropriate, you don’t have to stick a label on it.” She said people may find their happiness in that brand because she understands their body type or desire for comfort or preference for natural fabrics that breathe, without labeling her.
With marketing’s sweet spot being between 18 and 49, the question is whether brands simply let the Boomers go quietly into the sunset.
“I probably said this five or 10 years ago, I don’t think retailers, particularly now, and manufacturers have the luxury to do that,” Liebmann said. She explained that the Millennials had been the golden goose. “They were going to grow up and get out of school, get their first apartment, or house or start their families. They will have the money to spend because they’re moving into acquisition life stages. Coming out of the recession, this audience, for lots of reasons, economically, socially and digitally, are very different. They do not spend money like previous generations did. They are not mad acquirers. They are driving things like consignment shops and thrift shops. They’re the ones using digital and if it’s clothes, they’re buying high-low, looking for the best deals. They are much more price sensitive than any other demographic,” said Liebmann.
Many factors make the Millennial generation less opportunistic than previous generations, said Liebmann. “In some ways, there’s never been a more critical time for companies to rethink the Boomer population as an opportunity because they’re not going to get the dollars they’re expecting from a younger population today,” she said. Certainly not for the next five years, she added. “We now have a very frugal shopper in the Millennial who knows where to get the best deal, they’ll be managing their spending around fashion for the foreseeable future. Boomers, in our data, are more comfortable in their economic situation and are more brand loyal and are less price sensitive at the moment,’ she said.
Liebmann sees opportunities for accessories and jewelry companies, which are not size-specific, to target Boomers. “Look at all the Boomers wearing knee-high boots so they can wear shorter skirts. Accessories, leatherjackets are less generational and size-centric. Even to some degree, you look at Michael Kors, his silhouettes are simple, elegant, forgiving. You see that broader opportunity to things that give a nod to Boomers, without saying, ‘We’re a line for Boomers,’” said Liebmann. “I’m always amazed you walk into Uniqlo and everyone has one of their puffy jackets. It’s not age, not generational, and it’s not gender. Everybody’s invited to that proposition,” she said.
Anthropologie, while it has a youngish bohemian vibe, also has products for older shoppers, said Liebmann. “It is about understanding what the store experience has to be, what the service looks like, things like shared fitting rooms, signage.”
Someone who is 65 is not putting on sweatpants, gardening and playing golf, she said. “There’s an active, work-focused Boomer in the community who needs work clothes that are very relevant. That’s the other macro trend that’s driving Boomer opportunity. They’ve got money, they’re feeling more comfortable, many are still interested in fashion and you can talk to them digitally if you choose to, they have specific needs to dress appropriately,” said Liebmann. “It’s not all about an elastic waist. Even if a Boomer wants a more giving waist, it’s about letting me know that you’ve got fabrics that breathe, that are easy to take off.
“I do think however that most of the retailers, particularly on the fashion side, department stores, big boxes or specialty retailers, are still on this quest for the Millennial. That, in itself, is challenging in a couple of ways,” said Liebmann. She said the communication could be off-putting to an older customer.
“We really are betwixt and between with the generations and how to both engage younger shoppers in a brand and in a retail environment to build a future shopper, and on the other hand, the ones still with the money, feeling more comfortable about their assets and spending power, feel that most of the big retailers and chains don’t care for them at all, and especially in the fashion area, and go and spend their money on other things,” she said.
Women's Wear Daily - Lisa Lockwood - August 25, 2014