Marketers are facing a daunting generational transition for the next 15 years.
The numbers don't lie...and the future they portend is not a pretty one. Despite our industry's zealous devotion to Millennials, the fact is that marketers won't be able to count on them to become the kind of mature, sophisticated, high-volume consumers that their parents (the Boomers) have been until about 2030...at the earliest!
First, some background: One of the dividends of starting the first ad agency targeted to aging consumers is that I'm frequently invited to speak to gatherings of influential people across a great diversity of businesses -- from financial services to fashion to luxury goods and more. In the past two years, these sessions have often taken the form of a "debate," or more accurately a "staged confrontation," between Boomers and Millennials.
What most audiences discover - often to their great puzzlement and sometimes to their delight - is that Boomers and Millennials actually have more in common than not. Look beyond their behavioral peccadillos and you'll discover that they share a core set of values. This is not surprising when you remember that the Millennials are, by and large, the children of Boomers. In my view, no two generations in modern history have been more emotionally and culturally connected.
The fundamental challenge that most all marketers seem to be debating is whether to prioritize the Millenials ("the future of my franchise") or the Boomers ("my brand loyalists who are getting older"). Here's what most of them know...and don't know:
They know that Baby Boomers -- the Most Valuable Generation™ of nearly 76 million rabid consumers who powered the US and global economy from the end of WWII to the end of the 20th Century - have given way to a new generation: Millennials...just as large, and destined to propel economic growth and human achievement to even more stratospheric heights. This highly educated, digital-media-savvy cohort will one day "rule" global society and consumer marketing culture just as their parents once did.
While it's clear that Millennials represent the future for brands and businesses, it's far less clear when that future will arrive. Marketers are staring at the clock..... but it has no hands.
Consider that the current age range of the Millennials is 20-38 with the bulk of them in the middle of a demographic "bell curve." Add to that what we know about when people marry, have families and build households; and then factor in the college debt burdens and depressed pay scales for most jobs that have postponed these decisions for Millennials. You come quickly to the inescapable conclusion that the leading edge of Millennials will not achieve the spending power of their Boomer parents for another five years...and most of the rest not until 2030. If you're in categories such as big-ticket durables or luxury goods, you're staring at a 15-year abyss before Millennials make the full generational transition.
(The only positive spin, if there is one, is that "late-blooming" Millennials -- who are likely to stay in the job market longer and have fewer children that their parents -- will help to re-adjust the projected imbalance between inflows and outflows in the Social Security Trust Fund. This means that it may not be in danger of defaulting on its obligation to the Boomers as they continue to retire at the blistering pace of 10,000 per day for the next 15 years!)
As with every other life-stage, Boomers are re-defining "aging" and "retirement" unlike any generation in history. They are staying healthier, more active, more relevant and more connected than previous generations; and they still control more discretionary income and luxury goods spending than any other consumer cohort.
Those Boomers who do "retire" are becoming more active, not less. They're renovating, travelling, volunteering, starting new businesses, celebrating anniversaries, getting re-married and also taking a more active role in the lives of their children (and grandchildren).
So if you're one of those marketers who are staring out into the distance trying to figure out what your future looks like, you might want to look down instead. Depending on what business you're in, there's a good chance that there's a gaping generational gap right at your feet. It's quite possible that it's going to be another 15 years before the generational bridge is complete, and if that's the case, you're going to need a new plan. It's time to turn around and focus on the valuable consumers you already have. Remember, the Boomers are big, valuable and they love the brands that love them. If you continue to embrace them, you're sure to keep your business on solid ground for years to come.