To quantify this new reality, the number of adults 35 years old or less will decline a total of 8.3 million between 1990 and 2000, while the number of adults older than 50 will grow by 12.2 million. Fully one-third of the U.S. population will be age 50 or older by 2010, up from one-quarter in 1991, presenting abundant opportunities for alert businesses in every sector that can successfully meet the needs, tastes and concerns of this influential and affluent niche.
If a product is marketed to the 50-plus audience and maintains its market share, it should increase in sales by 35 to 50 percent in the next 20 years. Conversely, a brand targeted at the zero to 50 age groups will be flat in sales.
"Middle age is where the action is for the next 15 years,". Not only are 76 million baby boomers beginning to move into their 50s, but they have money to spend. According to an Age Wave analysis, by the year 2000, heads of households ages 45-54 will increase their annual expenditures by 36 percent. At the same time, the 65-plus population will probably be close to 40 or 45 million in size.
However, as the mechanics of the aging population pick up steam, "there is a huge peril at viewing this segment as one gray mass," Adler cautions, "and not recognizing the diverse habits of 50-plus consumers." People in their 50s could have young children or grandchildren, for example. They may be in their prime earning years, or have interrupted a career to go back to school or start a business. And they are as likely to be dating as their younger counterparts, perhaps for the first time in decades. As Dychtwald points out, "the traditional linear plan, from birth through adolescence and marriage to death" is no longer accurate.
At the same time, as boomers begin turning 50, there's no indication that they'll expect or accept physical deterioration. This is, after all, the generation of aerobic exercise and "natural" foods a term that will continue to carry weight for this consumer bloc as it matures. "They're not going to sink gracefully into fat old age. Companies desirous of courting the growing 50-plus audience must not define it by age or income alone, but instead should segment this diverse market based on a combination of physical, social and psychological factors.
Opportunity Abounds
Many companies have already been taking steps to maximize this new 50-plus demographic reality. A luxury automaker uses a satirical Janis Joplin rock song from the rebellious 1960s in a television commercial. McDonald's develops a hamburger targeted to adult tastes with a multimillion-dollar marketing campaign to match. And the man who developed Clearasil to help the baby boomers navigate through their teenage years has acquired Grecian Formula hair coloring, repositioned it toward men, and started selling it in drugstores.
There is definitely money to be made by paying attention to the needs and concerns of the various segments of the 50-plus audience. Although it is erroneous to assume that baby boomers are homogeneous in their buying patterns, common sense suggests that offering products or services aligned with some basic marketing principles will go a long way to attracting this complex segment:
- Make sure what you offer is perceived as good value for the money. As baby boomers get older, they are making sure that what they buy is priced reasonably. And the existing retired population is faced with getting the most from their fixed incomes. Witness the recent growth in discount stores such as Ross Dress for Less, Home Depot and Wal-Mart.
- Products should be well designed with broad applicability. The key to success is to produce products flexible enough to be useful for older people and those with disabilities as well as the general population, resulting in products with wide appeal.
- Don't assume that 50-plus customers are recalcitrant and brand loyal. All the studies indicate that mature consumers are as likely, if not more likely, to switch for value.
- Get 50-plus consumers involved in your sales and marketing. Have them sell, do customer service, and provide insights on how best to appeal to this diverse group. Keep in mind that the generation that said "don't trust anyone over 30" is now saying "don't trust anyone less than 30" and may very well soon be saying "don't trust anyone under 50."
No matter what you are selling, keep the following guidelines in mind when communicating with the 50-plus market:
Sell experience, not age.
Talk about experiences, not getting older, to attract this audience of individuals who are used to getting what they want and are not interested in growing old gracefully. If your ad touts your product as being specifically designed for older people, it will probably not be well-received. Instead, emphasize that the people who will most benefit from your product are those with "experience in..."
Choose your words carefully.
Don't address the 50-plus group by calling it "older" or "senior;" the words "mature" or "prime" are viewed in a much more positive light. Inspire people to buy, rather than trying to scare them into doing so. For example, smart insurance marketers position themselves as selling investments, not just protecting loved ones in case of the death of the main provider.
Use positive role models.
"Seniors already know what's wrong with them and don't appreciate being reminded of their limitations," according to Frank Conaway, president of Prime life, a marketing consultancy specializing in the senior market. At the same time, as baby boomers age, they are not buying into the old stereotypes. They want to enjoy their mature years, and live actively and positively while dealing with the challenges of growing older. For this reason, using healthy, active, age-appropriate role models in advertising will help attract both seniors and baby boomers.
Pay attention to the needs of aging customers.
Make certain your signs, packaging, marketing materials and nametags are easy to read. Select larger type sizes (12 to 13 points) and simpler type styles, and avoid all uppercase lettering. Make good use of "white" space; copy that is too dense is harder to read. Avoid using subtle color combinations the strongest color contrast is the easiest to see, and that's black and white.
Have your place of business well lighted, inside and out, and keep it adequately heated, with background music toned down. Watch out for shiny surfaces, and minimize outside glare as much as possible. And, if space permits, place a couple of chairs in strategic locations so customers can sit down and rest.
Choose your media carefully.
When targeting any specific market, choose media that reach this audience. The challenge with the 50-plus segment is finding media that speaks to distinctions in lifestyle, stage in life and health status, as opposed to age ranges alone. And don't ignore the Internet. Despite being a new medium marked by constant change and a certain degree of chaos, experts agree that the Internet is here to stay, and the familiarity of baby boomers with computers makes it an increasingly plausible marketing tool.
At each stage of their lives, the needs and desires of the baby boomer generation - likened by demographers to "a pig moving through a python" - have become the predominant concerns of both business and popular culture. As the nation's dominant age group begins turning 50, companies that understand of the vast implications of this demographic shift and prepare for the new needs of a maturing population are destined to profit.
A Profile of Baby Boomers at Mid-Decade
While the diversity of baby boomers grows increasingly apparent as they age - given an 18-year generational span ‹they still stand together in some ways, with clearly defined preferences and opinions that distinguish them from other Americans. These generalized characteristics include:
- They are more likely than either younger or older adults to have dependent children at home.
- Despite delayed marriage and high divorce rates, nearly two-thirds are currently married.
- Baby boomers are already in their peak labor force participation years, and in some cases in their top earning years (which are from ages 45 to 54) as well.
- They are less likely than younger adults to change their marital status through divorce or remarriage, and are less likely to change jobs or move.
- More than six million baby boomers are already grandparents, and that number will probably quadruple during the next 10 years.
- Baby boomers, born after World War II, tend to be much more individualistic.
- They are less happy than other adults with the status quo, and are marked by their skepticism and rejection of authority.
- They are notorious for their willingness to buy on credit and forego saving money.
- Baby boomers have less leisure time than other adults, and claim to feel stressed more often.
- When listing their priorities, baby boomers are more likely than others to focus on education.
- They also are more likely than older or younger adults to own a computer.
STEPS IN CONDUCTING MARKET RESEARCH
1. Define the specific nature of the problem or question to be investigated.
- Are declining sales a problem or a symptom? What are some of the reasons for declines in sales?
- What kinds of opportunities exist to expand existing markets and/or to tap new markets?
In order to implement the marketing concept, marketers require information about the characteristic, needs wants and desires of their target markets.
Definition:
Marketing research is the process of defining a marketing problem & opportunity, systematically collecting and analyzing information, & recommending actions to increase an organizations marketing activities.
It is the function that links the consumer (customer) and public to the marketer through information.
Need to approach the research in a logical manner. Difference between good and bad research can depend on the quality of the inputs.
- must be conducted in a systematic manner
- involves a series of steps/processes
- data may be available from different sources
- research applies to any aspect of marketing that needs information
- findings must be communicated to the appropriate decision maker
There are 5 steps in the marketing research process; it is an overall approach, not a rigid set of rules.
Defining and locating the problem
Usually a departure from some normal function, IE conflicts between or failures in attaining objectives. (Goals may be unrealistic) Need to probe beneath the superficial symptoms.
Research objective specifies what information is needed to solve the problem.
Marketing Plan...to determine the unfulfilled needs/wants within specified target market(s). (University students/local residents)
May need to use exploratory research here, before conclusive research.
Therefore query news group with your ideas to better define your research needs perhaps, refine your ideas before developing your hypothesis!!
Assess the decision factors
Different sets of variables, alternatives and uncertainties that combine to give the outcome of a decision.
Alternatives---decision maker has control
Uncertainties--uncontrollable factors
Decision maker must:
- Determine the principal alternatives that can be considered reasonable approaches to solving the problem...i.e. reasonable outcomes of research.
- The major uncertainties that can affect particular alternative and result in it being a GOOD OR POOR SOLUTION TO A PROBLEM.
Collect Relevant Information
Concepts
Developing Hypothesis
Drawn from previous research and expected research findings. An informed guess or assumption about a certain problem or a set of circumstances.
As information is gathered researchers can test the hypothesis. Can have more than one hypothesis in a study.
Methods of collecting the data
Two types of data, Primary, Secondary inside or outside the organization.
Secondary data collection
internal database data (). Accounting data, government data, magazines, survey of buying power, syndicated data services, Marketing Research Corporation of America.
PRO Inexpensive, quick to obtain, multiple sources available, obtain info. That cannot be obtained through primary research, independent therefore credible.
CON maybe incomplete, dated, obsolete, methodology maybe unknown, all findings may not be public, reliability may be unproven.
SOURCES: internal = budgets, sales figures, profit and loss statement, all research reports.
External = government, must consider dates, census of population/manufacturing/retail trade, regular publications, IE Wall Street Journal, Business Week, Commercial research houses: for a fee as a subscriber IE AC Nielsen.
Primary data collection
Information "collected specifically for the purpose of the investigation at hand", Dictionary of Marketing Terms. When a thorough analysis of secondary research provides insufficient information for a marketing decision to be made.
PRO Fits the precise purpose of the organization, information is current, methodology is controlled and known, available to firm and secret from competitors, no conflicting data from different sources, reliability can be determined, only way to fill a gap.
CON Time consuming, costly, some information cannot be collected.
Research Design
The frame work or plan for a study that guides the collection and analysis of data, it includes:
- Who collects the data?
- What should be collected?
- Who or what should be studied?
- What technique of data collection should be used?
- How much will the study cost?
- How will data be collected (personnel)?
- How long will data collection be?
Gathering Data
Sampling
To select representative units from a total population.
A population "universe", all elements, units or individuals that are of interest to researchers for a specific study. IE all registered voters for an election.
Sampling procedures are used in studying the likelihood of events based on assumptions about the future.
- Random sampling, equal chance for each member of the population
- Stratified sampling, population divided into groups re: a common characteristic, random sample each group
- Area sampling, as above using areas
- Quota sampling, judgmental, sampling error cannot be measured statistically, mainly used in exploratory studies to develop a hypotheses, non-probabilistic.
Survey to news group is an example of quota sampling...will be non-probabilistic.
Survey Methods
Collect data from available sources.
- To successfully segment a market, three types of information are needed:
- Geographic (Where are customers located?);
- demographic (What are the characteristics of potential customers including gender, age, education levels, income, employment status, marital status, number and age of children?);
- Psychographic (What drives customers' buying behavior? Are they receptive to new services or products, or are they slow to accept them? What values are most important to them?
- If to collect data directly, we can do this via:
MAIL
Advantages:
- Least expensive method.
- Eliminates interviewer bias.
- Respondents can complete the questionnaire at their leisure.
- Can often reach people who may otherwise be inaccessible.
- Sensitive questions can be asked.
Disadvantages:
- Complex questions yield poor results.
- Questions may be ignored by recipients.
- Possible low return rate.
- Lack of control of who completes the questionnaire.
- No opportunity to clarify confusing information.
- Time consuming.
TELEPHONE
Advantages:
- Fast and convenient.
- Relatively low-cost method.
- Can contact respondents at particular times of the day.
- Can determine who is responding to questions.
- Complex questions can be explained.
- Minimal time and effort is required to train interviewers.
Disadvantages:
- Respondents can easily hang up.
- Respondents can only be asked a limited number of questions before they hang up.
- Obtaining a random sample requires random digit dialing.
- You cannot present any visual materials to solicit responses to product style, design, etc.
- Cannot see respondents to observe nonverbal communication.
PERSONAL INTERVIEW
Advantages:
- Face-to-face contact makes this the most reliable survey method.
- Can usually select a representative sample.
- Complex questions can be explained.
- Can use visual materials.
- Fairly fast data-collection method.
- Can observe nonverbal communication.
Disadvantages:
- Most expensive method.
- Interviewer bias may affect responses.
- Expensive and time-consuming to train interviewers.
- Poorly trained interviewers can negatively affect responses.
- May have difficulty scheduling some key respondents.
- Asking sensitive questions is difficult.
- If you cannot afford to directly collect your data, there are several sources of secondary data (from other sources which may provide you the above information).
Questionnaire Construction
Designed to elicit information that meets the studies requirements. Questions should be:
- Clear
- Easy to understand
- Directed towards meeting an objective.
Need to define objectives before designing the questionnaire. Must maintain impartiality and be very careful with personal data. Four basic types of questions are:
- Open ended
- Dichotomous
- Multiple choice.
- Scaled (lickert)
Time frame must be stipulated so that it does not drag on. Only ask needed questions...keep it short!!
Demographic questions at the end!!...Always!!
Always attach an explanatory cover letter!!
Observation Methods
Record overt behavior, note physical conditions and events. "How long does a McDonald's customer have to wait in line". Can be combined with interviews, IE get demographic variables. To avoid bias must avoid being seen.
Mechanical observation devices, IE cameras, eye movement recorders, scanner technology, Nielsen techniques for media.
Observation avoids the central problem of survey methods, motivating respondents to state their true feelings or opinions. If this is the only method, then there is no data indicating the causal relationships.
Find a Solution
The best alternative that has been identified to solve the problem.
Evaluate the results
Coke, do the results make sense, don't always accept them at face value.
Bibliography
1.
~Barrie Gunter
Routledge, an imprint of Taylor & Francis Books Ltd
2.
~Marylyn Carrigan
Univ.B'ham.
Paperback - July 1997
3. www.askjeevan.com