Why? Boomers are a special generation shaped by the life- and nation-altering events such as the space race, the swinging '60s, the Vietnam War, the Cold War, and assassination of President John F. Kennedy. Moreover, an unprecedented population shift will occur over the next few years as the over-50 segment of the U.S. population rises to 30% of the total by 2010.
Green, 55, is a boomer himself and grouses that businesses such as ski resorts and recreational outfitters like REI still don't understand the importance of the trend. But the sheer size of the boomer cohort will make its impending retirement difficult to ignore for much longer, Green says. He recently talked to BusinessWeek Online reporter Pallavi Gogoi about boomers and the business opportunities they represent. Here are edited excerpts of the conversation:
Q: What's the special appeal of boomers to businesses?
A: It's a concept called zeitgeist -- a shared feeling for an era and spirit of the times. Not every generation experiences a powerful zeitgeist, where together they go through events that have a tremendous impact on their values, views, and culture. In my book, I focus on the baby boomers born from 1946 to 1956. Among other things, they experienced and witnessed as young adults the Vietnam War, the birth of modern feminism, and the intensity of the civil rights movement, among others. These events are in the collective consciousness of baby boomers, which is why it's really possible to market to them as a generation.
Q: How will marketers have to change to cater to this new generation of retirees?
A: To the GI generation, retirement meant disengagement and marginalization. For marketers, older people weren't considered a major factor in setting agendas and policies because they were retirees who were segregated from other generations and disconnected from mainstream society.
Boomers will change that in terms of being heavily engaged with what's going on in the mainstream. Just as they have been a much more active group in all their life stages, they'll be an active 60-plus group. Back in the 1960s, you would rarely see anybody over the age of 40 jogging, and today it's a common sight.
Many boomers will likely [continue to] work, either because they're broke from the stock market crash of 2000, or they would like to continue to work in some form. This group is not only a large group but they will be empty nesters [who will] have discretionary income that will range between $750 billion to $1 trillion.
Q: Why can't traditional marketing work with the boomers?
A: Many businesses think that it's not important or necessary to address this group as a separate market because brand loyalty solidifies and hardens and remains permanent -- you don't change. Research shows that brand loyalty varies by product category more than age. I might be slow to give up Colgate toothpaste, but in other categories such as automobiles or clothing, boomers have shown no greater brand loyalty than any other generation. They're willing to try new products.
It's time to throw out the notion that the only things marketable to this market segment are chiropractic mattresses, cruises for older adults, or an arthritis drug. It's a myth that you can't teach an old dog new tricks. On the contrary, people over 50 are some of the heaviest users of the Internet for research and product buying.
Q: Isn't it also the first generation to grow up with McDonald's (MCD
A: We were indeed the first mass market. Boomers grew up with strong messages coming at them to buy. We have been told since our childhood that buying and owning is the right thing to do: If you're an American, you consume. And the choices available to us were also many. We definitely had more goods and services to tantalize us than the GI generation.
Q: Are there any industries, businesses that are doing a good job of marketing to boomers?
A: Chico's (CHS
) has been a phenomenal success as a big-chain retailer that went after boomer women. Now Gap (GPS
), the quintessential youth retailer, plans to open stores designed for women over 35.
New Balance has built its success by recognizing the changing value sets of the boomer generation, and its advertisements reflect that -- rather than have testosterone hit the rubber like Nike (NKE
), New Balance ads have people who apart from leading healthy lives, appreciate the world around them. Even Pillsbury, a brand that boomers grew up with, recognizes [the particular needs of] empty nesters by coming up with dinner rolls for two people.
Q: And the businesses that have ignored boomers, or have been slow to adapt are...?
A: The skiing industry. Without a doubt, downhill skiing became a fashionable recreational sport because of the baby-boomer generation. But the industry has totally lost contact with the segment. Now you open any sports magazine, and you will see ads for snow boarders under 25 -- it's all about racing and extreme sports.
They're not the type of values that appeal to middle-aged adults. Rather, [these images] scare them away by giving the impression that they could be mowed down by some rambunctious extreme-sports buff. This is obviously a lost opportunity, both in terms of products and marketing that haven't been updated to meet the needs of a very large generation.
The active-outdoor-equipment marketers like REI and North Face also have ignored boomers completely. Research shows that boomers love to travel and backpack, but the [products] are marketed only to the youth.
Q: Maybe they think they've already captured the boomer market?
A: That's inadequate thinking and doesn't recognize the opportunity. Marketers who develop a relationship with boomers with products and reach out with marketing will be rewarded by dollars. [Baby boomers] will recognize the difference between companies that disregard them and those that see them as special.