The Baby Boomers are Still Booming
The leading edge of the Baby Boomers, including Cher, Sally
Fields, Donald Trump, and this writer, turns 55 this year.
Born between 1946 and 1964, these 37 to 55 year olds make
up a segment of the population that is still the fastest growing
market in the country, and will continue to be well into this
new century. For the past 25 years the Boomers ranks
have grown far beyond those in any other age group, even leaving
the nations prized youth market in the dust. Nearly
82 million strong, comprising a third of the American population,
this group of our society is very significant to business,
because it is also the segment with the highest percentage
of discretionary income. The Boomers will live longer and
are making more money than their parents did. They are the
industry and professional leaders as well as the civic and
government leaders. They have the money and they spend the
money. The Baby Boomers are changing the definition of old
age. Knowing the buying power of this huge market, what they
expect and how to reach them can help you capture their business.
The Boomers, with over $100,000 average net worth and a median
annual household income of over $60,000, are gainfully employed
with established careers. The discretionary income of the
older group, 45 to 55, is growing annually because their children
are out of college, with families of their own. These Boomers
over 45 have been described as Beyonders because
they are beyond orthodontists, college bills, payment plans
and mortgages. They have the disposable income to invest in
retirement, to buy cars and boats and second homes. The Beyonders
have 80% of the personal wealth in financial institutions,
spend 50% of all discretionary dollars, hold half of the credit
cards issued, buy 48% of all luxury cars, and make up 80%
of the luxury travel market. And theyre still working,
making more money and not about to retire.
Much has been said about the Baby Boomers retirement
and its effect on Social
Security, the health care system and the economy. Well, the
Boomers arent as ready to retire as some may think.
They arent looking for a gold watch and a pension check
like their parents did. Retirement as we know it, is going
to have a whole new look because tens of millions of Boomers
plan to work beyond age 65. It is estimated that 80% of the
Boomers want to work at least part time in their retirement.
Only 16% feel they will not work at all. Close to half say
they expect to devote more time to community activities and
volunteer work after they retire. All in all Boomers are optimistic
about their retirement years.
The Baby Boomers definition of their retirement seems
to include a large measure of self reliance, which challenges
assertions that held they were only concerned about the present.
Less than half are counting on Social Security as a major
income source and only 15% are expecting to rely on it for
all their financial retirement needs They dont want
to depend on their children. Nearly 70% of the Boomers are
looking towards self-directed income sources such as IRAs
and 401(k)s for their retirement. Six in ten are counting
on money from savings and investments as retirement income
and two thirds of them are satisfied with the amount of money
they are putting away.
Besides putting money away, the Boomers are spending it at
a record pace, enjoying their life style. They are the least
price conscious market, preferring quality and value instead.
Being the largest segment of home owners, Boomers are furniture,
appliance and home improvement product buyers. In many cases,
this affluent group owns more than one home. Leisure related
products are high on their lists, as well as recreation and
entertainment. They generate the highest travel volume in
the country, registering more than 260 million trips last
year alone. They spend more on their trips than other age
groups, averaging $460 per trip, excluding transportation
to their destination. Boomers make up over 70% of cruise passengers.
The Boomers are also grandparents and are responsible for
billions of dollars spent on toys and clothes for their grandchildren.
Over 60 million grandmas and grandpas spent an average of
$700 per grandchild in 2000, compared to $250 in 1988. That
spending will increase dramatically in the coming years as
more Boomers become grandparents; 72 million in 2005, 80 million
in 2010, a 30% increase over 2000.
As Boomers age, they will be joining the ranks of the real
wired generation, the 55+ crowd that is the fastest-growing
market of computer purchasers. They are the most active users
of the internet, with 71% on line. And theyre not just
surfing, theyre shopping and buying. 92% have shopped
on line, nearly 80% have made purchases.
Other hot categories for Baby Boomers are automotive, health
and grooming products, hearing aids (they heard a lot of loud,
rock music), home electronics, restaurants, real estate and
retirement housing. The Boomers arent looking for their
fathers Oldsmobile, theyre buying sports
cars, SUVs, Harleys, boats, RVs, jet skis and snow mobiles.
This Pepsi Generation...for those who think young,
wants to keep looking and feeling as young as possible. They
may be getting older, but they invented cool and
theyd like to stay that way, so theyre buying
record numbers of health and beauty products. Theyre
updating their sound systems, buying up their old albums on
CD and looking forward to HDTV. Boomers are responsible to
a great degree for the growing trend of out of home eating...theyre
filling up the seats in restaurants even when they dont
get a senior discount. And they are starting to think about
selling the big house and getting something smaller, with
only about 21% planning to move to a new geographic location.
Youll find the Boomers reading newspapers (Boomers make
up the highest percentage of newspaper readers); listening
to radio, especially news/talk, classic rock and standards;
watching television. This is the generation that used to watch
test patterns when TV was first introduced...now theyre
watching dozens of channels every day, especially news (early
news because theyre going to bed earlier than they used
to). The Baby Boomers are still the largest, most affluent
marketing segment in business today. Reach them and put a
Boom in your business.