Even though marketers now focus primarily on analyzing finely targeted
psychographic segments of the population, it still makes sense from time to time
to step back and look at broad demographic trends. If you are starting a new
business, moving your business or considering whether to add or change your mix
of products and services, you need to see the big picture first and then refine
your market segment further from there.
The big picture begins with overall population trends. In his book Who We Are
Now, Sam Roberts, a reporter, columnist and editor at The New York Times,
examines “The Changing Face of America in the 21st Century.” He analyzes volumes
of data from the latest Federal census in 2000 and points out how our nation is
changing.
Overall, this is still the land of opportunity. Every state is growing. There
were 281 million Americans at the time of the census, and every 12 seconds since
then the population has had a net growth of one person.
Not only are there more people to fuel our economy, but there are also more
households as a percentage of the population – and a high rate of household
formations translates into more housing units. In the 2000 census, the 281
million Americans made up 105 million households, meaning fewer people per
household than ever before. The number of Americans living alone is now greater
than the number of married couple households with children.
The Boomers’ Journey
Baby boomers are still the largest segment of the population, and their values
and attitudes will drive the kitchen and bath market for years to come.
As everyone knows, boomers are getting older. Americans over 60 will
approximately double in the years ahead, going from 35 million to well over 65
million by 2030. And, by 2011, the number of elderly will start to increase
dramatically as the first baby boomers turn 65.
Baby boomers, however, are getting older in a way that’s different from previous
generations. In Rocking the Ages, the Yankelovich Report on Generational
Marketing, authors J. Walker Smith and Ann Clurman caution, “You make a mistake
if you assume that just because your customers are turning a certain age, they
will behave in the same ways as those who turned that age before them.” Baby
boomers will change their consumption as they get older, but “in ways consistent
with the core values characteristic of their generation.”
So-called “retirement,” for instance, will be different. Boomers who can, or
want to, retire at 62 will start leaving the workforce in 2008, just two years
from now. But Peter Francese, demographic trends analyst at the agency Ogilvy &
Mather, wrote recently in Advertising Age that the long-term trend to early
retirement has reversed. He projects that, in 10 years, the majority of men in
their late 60s will still be working.
Boomers’ core values – a sense of entitlement and the attitude that “now is more
important than ever” – indicate that they’ll continue to readily spend money.
All indications are they’ll continue to believe in prosperity, and to focus on
self gratification.
Our market will be comprised of savvy, well-off consumers who are familiar with
home renovations and looking for full service, comfort and convenience.
Where and how boomers live this next phase of their lives will be important for
our industry. According to Roberts, “There is some evidence that suburban empty
nesters are returning to downtowns where transportation and culture are.” In
cities as diverse as Atlanta, Hartford, CT and Pittsburgh, loft conversions of
industrial buildings are accelerating. The logistics of installing a kitchen or
bath on the 10th floor of a high-rise are more challenging than parking your
truck in a suburban driveway. Do you know how to deal with homeowner boards and
infrastructures that can’t be moved?
Not all baby boomers are heading back to the cities, however. Roberts notes that
self-contained retirement communities are being built “not only in predictable
places like California, Florida and Arizona, but also in Georgia, North Carolina
and Virginia. The old news from the census is the growth of California, Texas
and Florida. What’s new is the spill over effect on neighboring states such as
Nevada, Arizona and Colorado. Other states luring baby boomers, according to
Roberts, are Mississippi and Alabama.
Not all boomers want to move; hence the trend to “aging in place.” That means an
extensive market for renovations in highly populated and affluent areas like New
Jersey. In 2000, New Jersey was the richest and most urban state in the union.
It also means development of retirement communities in places like the Poconos
in Pennsylvania and Jackson Township, NJ.
Multiple Homes
The New York Times recently wrote about baby boomers as “Splitters” or “Double
Nesters.” These are upper-middle-class couples in their late 50s and 60s who –
thanks to technology, empty nests and the desire to continue working (although
at a different pace) – divide their time somewhat equally between two or more
homes. Typically, each of those homes has an elaborate kitchen, home office,
entertainment area and plenty of bedrooms and guest baths. Some are condos, but
many are detached, single-family homes. In other words, second homes are being
used in a new way – not as vacation homes, retirement homes or rentals, but as
part-time residences.
If you appeal to this segment, you may find yourself doing second (or even more)
homes for a client. Can your business travel with your clients from Chicago to
Florida or Georgia? From Indianapolis to Tucson? Your competition may change
from the firm down the street to the designer in a town far away. Can you work
remotely? Find trades people in another area? Set up a satellite office? Partner
with a designer in another state?
No matter which segment of the boomers you serve, seize the opportunity now.
When this group of 78 million, now aged 41-59, passes through the market, it
will leave a significant void.
For all of the hoopla that surrounds “Generation X” (right behind the boomers),
its numbers are small. What’s more, Gen Xers are living with their parents
longer, and buying homes later, so they won’t be important to our industry for a
while yet.
“[Boomers] will continue to expect to be the center of attention,” say Smith and
Clurman. By strategically targeting them with effective, relevant marketing
campaigns that speak to their core values, you should be able to ride the boomer
wave for years to come.
Leslie Hart is executive v.p. of the Newport Beach, CA–based Fry
Communications, an integrated marketing agency specializing in advertising,
public relations and strategic branding for distinctive companies in the kitchen
and bath industry. She is the former editor and publisher of Kitchen & Bath
Business, and she has created custom books, magazines and marketing programs at
Meredith Corp. She can be reached at 212–989–4629 or leslie@fry-comm.com.
All of the above text is a press release provided by the quoted organization.
globalagingtimes.com accepts no responsibility for their accuracy.