by Sam Hatcher
An overwhelming number of advertisements may conjure images of glamorous millennials buying what appears to be entire lives online or spending lavishly in-store with chip-activated credit cards in tow, but economic reports reveal it’s the baby boomers who catch the eye of smart money.
Wise marketers follow the figures – and the facts don’t lie – baby boomers not only have the most money to spend, they also do the most shopping. And they’ve ushered in the greatest jump in potential earning years (and spending years) ever seen in America. In addition to simply living longer, those born from 1946 to 1964 are entering what used to be thought of as old age in a physical condition much more akin to that of yesterday’s middle-aged consumers. This newfound later-life vitality allows boomers to transform “aging” into a door that’s opening rather than the end of their relevance. True to form, it looks like boomers are changing yet another cultural facet of the new millennium.
Shifting focus to the spenders
As international market research groups continue to predict baby boomers and the Generation X population will greatly outspend millennials this year, more and more retailers are advised to place a greater focus on shoppers 50 years and older. The boomers are highly coveted not only for their sheer size (an estimated 78 million) but also because they have properly put their respective nest eggs aside for retirement, have little debt, active lifestyles, and are capable and qualified buyers.
Recently in Orlando, Joseph Coughlin, founder of the AgeLab at the Massachusetts Institute of Technology, told a group of shopping center owners and developers that retailers would be better off targeting aging generations rather than younger ones.
Addressing the International Council of Shopping Centers Florida Conference, Coughlin noted that 70% of the disposable income in the U.S. is controlled by a demographic that is 50 years old or older, and noted the fascinating trend that more and more boomers are choosing to retire to more urban areas in less populated cities (with university towns a heavy favorite) as opposed to suburban retirement communities isolated from cultural offerings and inspiring events. These progressive ideas about retirement prove boomers are not viewing aging as the end of anything, but rather a whole new beginning, with the precious bonus of life experience right in their back pocket.
Buying power, mighty & matured
It’s frequently recognized that Generation Y, the millennials demographic, recently surpassed the baby boomers in size (both have almost 80 million members), but, the reality is, the millennials’ strongest buying power period is still decades away.
As for today, it’s the boomers who are opening their wallets.
“Boomers outspend the other ages in every category,” notes Matt Thornhill, founder of the Boomer Project, a Richmond, Va. – based marketing research and consulting firm.
Backed by great numbers and a refined taste, the boomers make for quite a bountiful consumer group. According to EconomyandMarkets.com, here are the top ten market sectors that boomers will enliven in the coming years, reflecting a clear direction towards health, wellness and travel:
MARKETS PREDICTED TO BOOM
1) Discretionary health care, wellness
2) Assisted Living Facilities
3) Health and life insurance
4) Retirement and financial planning
5) Home maintenance services
6) Convenience and drug stores
7) Pharmaceuticals and vitamins
8) Urban townhouses and condos
9) Active vacation homes
10) Recreational Vehicles (RVs)
Boomers’ greatest contribution may be their continuing participation in the labor market. By working longer and continuing to earn and spend wages, older Americans are contributing more than ever to economic activity, helping to fuel economic growth far beyond the traditional retirement age. What makes this most impressive is that their economic input is achieved in ways that complement rather than compete with the contribution of their younger counterparts – older people are not only extending their work lives, they’re also working in new ways, exploring passion projects through silver entrepreneurship and a conscious shift to prioritizing work-life balance over corporate-ladder-climbing.
By demanding such sweeping changes to the quality of life of the aging American, Baby Boomers are facilitating a colossal mind-set shift in the free market itself, a market which, ultimately, we all rely upon.