SBJ/June 26 - July 2, 2006/SBJ In Depth

Trying to catch the wave

I am a 62, soon to be 63-year young surfer. Still very active in the sport. I (manufacture) a line of surfboards in Florida. I also design and (manufacture) a line of fine timepieces. I have two retail locations.
I am contacting you two-fold. First, I am interested in doing commercials, television or print, geared toward the baby-boomer market, showing me still surfing. I need an agent for this. Second, I want to come out with a sportswear line, geared towards the active baby-boomer, and need someone to help me put my ideas together.
I saw your website and thought you might be the person I need for the above.

— Spyder Wright
Chuck Nyren’s e-mail box is loaded with notes like this one, missives and solicitations from entrepreneurs, marketing execs and general Web wanderers who come upon his site, or the blog contained within it, and then flock to him for answers.

Last year, Nyren wrote a book called “Advertising to Baby Boomers.” Turns out, it’s something some brands think they should do.

This is a departure. Not the part about chasing the boomers, a hyper-chronicled generation that includes the 78 million babies born in the United States between 1946 and 1964. Companies and their ad agencies have focused on them for decades, drawn by their mass, the size of their wallets and their propensity to purchase. Boomers will spend about $1.7 trillion this year, representing about half of the nation’s consumer buying power.

What is new here is that the boomers are now crossing into an age bracket that mainstream advertisers long have ignored. The first of the baby boomers turned 60 this year. Another U.S. boomer will turn 60 every 7.5 seconds, every day, until the last of them crosses that threshold in 2024. More than half of boomers already are over 50.

In the past, marketers have thought of age 50 the way the explorers used to think of the horizon: Sail beyond it and you tumble from the face of the earth. Older consumers were seen as set in their ways. Since they wouldn’t change brands or try new ones, there was no point in spending money advertising to them.

Baby boomers are interested in much more than just fading away, forcing marketers to have new views on this aging demographic.
Nyren once subscribed to that school of thought. Now he battles it. He grew up in the ad business, with a mother who was a copy writer, a father who was an agency VP and a grandfather who was one of the original Madison Avenue pitch men. He’s proud that an industry once monopolized by white males opened itself to women and other races and ethnicities under the watch of the boomers. But there was one way in which his
generation of marketers threw up a wall.

“Our blind spot was age,” Nyren said. “We were the ones who started only marketing to ourselves. We created the demo. We taught people how to market to it. And now, we’re paying the price, because the agencies have all been brainwashed into thinking that to be worth anything [to marketers], you have to be young.”

As far back as a decade ago, a San Francisco-based psychologist and gerontologist named Ken Dychtwald was riding like Paul Revere into the offices of Fortune 500 companies, telling them, their ad agencies and anyone else who would listen that the inevitable advance of the boomers would force them to change the way they did business.

Lori Bitter, who worked for Dychtwald at his consultancy, Age Wave, remembers him using the analogy of an elephant stampeding through the jungle. “Either go dig a hole right now,” he told marketing executives, “or you will be shooting arrows at its ass for the rest of your careers.”

Now a partner in the mature market group at ad agency J. Walter Thompson, Bitter chuckles at her old boss’s prescience.

“All of a sudden, on Jan. 1, everyone is saying, ‘Holy smokes, the boomers are here, we better get a boomer strategy,’” Bitter said. “Well, we’ve been telling you this for 10 years. Welcome to the party.”

Retirement can wait
With the first of the boomers eclipsing 60, the discussion that orbits them inevitably turns toward retirement and the sort of decisions that come with it. Relocation to warmer climes. Financial planning. Medical care. Leisure activities framed around long and distant travel.

Those discussions may be premature in the case of the boomers.

Matt Thornhill, founder of the Boomer Project, a marketing research firm and consultancy based in Richmond, Va., regularly asks the audience that he studies about their plans for the coming years.

“At every phase of life, boomers have looked at how their parents have done things,” Thornhill said, “and their general response has been, ‘Yeah, I don’t think that’s going to work for me.’”

Thornhill points to the way boomers rewrote the rules of childbirth, creating classes to teach moms to labor properly and inviting fathers into the delivery room to cut the cord. “It’s almost as if everybody having babies for all those years before we came along had done it wrong,” Thornhill said.

Ditto retirement. When Thornhill’s firm asked boomers over 50 at what age they plan to retire, half said they had no idea and 37 percent chose 68. A more widely circulated survey commissioned by Merrill Lynch found that 71 percent of boomers hope to reinvent the process entirely, staving off retirement by either continuing to work full time (5 percent), working part time (17 percent), starting their own business (11 percent) or going back and forth between stretches of work and leisure at their own pace (38 percent). They think they’ll start that next stage at 62 and stop at 70, if they stop at all.

Get to know...

Robin Johnson
Age: 52
Home: Forest Lake, Minn.
Job: Real estate broker and commercial
insurance producer

A change in the retirement dynamic has implications that reach beyond the walls of planned communities.

“If the boomers don’t retire, this whole how and when you spend time with your grandchildren has to change,” Bitter said. “There’s no more ‘go spend the summer with grandma in Florida.’ Grandma and grandpa are still working. So how does that change? Sports have a way of creating little mini-experiences with grandchildren that could be really awesome.”

Bitter suggested ticket packages that encourage grandparents to take grandchildren to games and imaging that shows multiple generations enjoying events together.

Those boomers who do envision a traditional retirement don’t think they’ll spend it the way their parents did. At a recent focus group, Chicago-based C&R Research asked boomers about the ways they planned to spend time after they quit working, and where they thought they might do it.

“They said retiring and going to Florida is like signing your death certificate,” said Anne Wall, a senior vice president who leads C&R’s BoomerEyes initiative. “That’s just not where their heads are.”

Thornhill, of the Boomer Project, lands somewhere between militant and indignant when you suggest that Boomers will migrate to the Sun Belt, as their parents did.

“We are not going to pack up and move to Florida to join Jerry Seinfeld’s parents at Del Boca Vista on the condo committee,” Thornhill said. “We’re going to stay in our neighborhoods and communities and look for ways to give back, because now we’ve got the time to give back.”

Experiences, such as taking in Game 2 of the NBA
Finals in Dallas, have become the calling card
for the baby-boomer generation.
All about the experience
On the morning of the NFL draft, four Visa Signature credit card holders had breakfast with ESPN college football host Chris Fowler, toured the green room and took turns handing the proper team cap to each of the first four picks as they walked onto the stage.

You couldn’t win that opportunity in a sweepstakes, or even buy it on the open market. It was available exclusively to Visa Signature holders, for a surprisingly low price of $75. Among the opportunities offered to cardholders this year: the chance to be on the field during the presentation of the Lombardi Trophy at the Super Bowl, to buy hard-to-come-by grandstand seats for the Kentucky Derby, and dinners hosted by various celebrity chefs.

“We’re creating experiences that money alone can’t buy, that your Visa Signature card will give you access to,” said Michael Lynch, senior vice president of event and sponsorship marketing for Visa. “It’s an array of unique and once-in-a-lifetime experiences that appeals to this group.”

This group happens to be composed largely of boomers. Though the Signature card is available to all ages and a range of income levels through various banks, Visa considers those with household incomes over $125,000 to be its target. About 54 percent of that affluent segment of cardholders falls between age 45 and 64, with 32 percent between 45 and 54.

As a result, Lynch said Visa has surveyed boomers extensively and designed the Signature program accordingly, crafting benefits that appeal to them. Chief on that list is access: the chance to do things that aren’t routinely available, even to those who are willing to pay for them.

It’s a shift in values that boomer experts frequently stress with their clients.

“As consumers get older and boomers get older, they become less interested in material goods and more interested in the experience,” Thornhill said. “He who has had the most experiences in his life at the end, wins. Boomers become less materialistic with age. Stuff is less important than experiences.”

Lynch, who routinely deals with major sports properties, says that’s a lesson for anyone who hopes to retain boomers as customers as they enter this next life stage. As they move through their 50s, disposable income increases, as does available time.

In a recent survey of sports fans for SportsBusiness Daily and Journal, Turnkey Sports asked adults 35-60 why they did not attend more sporting events. The largest barrier they cited, across all ages, was cost. For those 35-46, the next biggest reason was lack of free time, a constraint mentioned by 23 percent. Only 8 percent of those 46-60 cited a lack of time. Yet those older consumers reported that they attended fewer games than those in the slightly younger group.

“If you want to get them out to the ballpark, you have to sell it as something that’s more than just watching a game,” Wall said. “They’re looking for experiences, and they’re willing to pay for them.

“You know what a game is for them? It’s something they share with their kids and grandkids. That’s the sort of thing that is important to boomers.”

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