Do we need a new marketing model? 1 – Why what we have is nonsense

The “generation gap” and the “reinvention of aging” aren’t news any more. We all understand that the “older” generations aren’t acting the way people of the same age acted in the past, and that the “younger” generations — particularly, the Millennials (in their 20s and young 30s) are experiencing extreme delays in hitting the same demographic and lifestyle benchmarks that previous generations hit at that same age.

This has profound implications for marketing. I’ve written a couple of books on this, with some material dealing with the marketing implications, and it’s the focus of what I write about on this blog. But so far, I haven’t seen anyone in the marketing community take the subject and really run with it. I think it yields an entirely new marketing model.

So far, though, most of the discussion and debate has been about why marketers overspend against the younger segments and underspend against the wealthier older cohorts. There are hundreds of articles complaining that Madison Avenue doesn’t “get it,” that they are still over-reliant on the 18-34, or 24-54, age groups and discount the older Boomers and seniors. There are numerous ad agencies and consultancies whose mission is to the prove that the Millennials are a highly valuable market, and that they (th

e ad agency or consultancy) have unique knowledge about that age group and a unique ability to help marketers reach them.

All well and good.

But I think there’s a lot of room to take the topic much further — and that’s what I propose to do in the next series of posts.

My premise is simple:

Everything is shifting older. Therefore, the classical marketing model is obsolete.

The classical model tied lifestyle to age:

  • Brand influence began in the teens (although the spending power was still with the parents)
  • The young to mid-20’s saw the  formation of new families and the all-important determination of initial brand choices
  • Spending rose steadily through the 30’s and 40’s and maybe early 50’s
  • Retirement followed, meaning that spending dropped and, since brand choices were hardened into place anyway, there was little or no reason to spend marketing dollars against that cohort.

Marketing strategies are still largely based on this model. And there’s no question that life stage component of it is still logical: you  go from a being a child with no purchasing power to a first-time and early-stage shopper in the marketplace, to a full-on consumer, to a cut-back stage and, eventually, the end.

What’s different, of course, is the absolute and total uncoupling of age from life-stage — at least, the ages that were previously assigned to the various stages. This uncoupling is so radical that it makes the entire model nonsense.

  • Family formation has increasingly been shifting into the 30’s, instead of the 20’s
  • First home purchase is increasingly in the 30s
  • Retirement is no longer automatic at 65
  • The fastest-growing age group, in percentage terms, is the centenarian segment

For marketers, the urgent issue ought to be: how do we align our strategies and messaging to these new realities? What do we say to 20-somethings, while waiting for them to have money? What do we say to 60- or even 70-somethings, realizing that they might well be still in the workforce and might have 20 or 30 years of spending power ahead of them? In fact, what does a 30-year spending trajectory look like, for a 60-something, and how do we, as marketers, play into it?

I don’t think marketers are spending nearly enough time figuring this out. To too large an extent, they’re still aligning dollars and age brackets based on the old model that no longer exists. In the next two posts, I’ll suggest some new ways of coming at it.

Stay tuned.

Boomers “bust out of their demographic.” What if age isn’t the main driver of behavior any more? – EverythingZoomer

Are we entering the “post-demographic age”? Maybe so, according to London-based “People – of all ages and in all markets — are constructing their own identifies more freely than ever…time to throw out the traditional (and tired) demographic models of consumer behavior.”

Their observations – and the supporting evidence – are laid out in this fascinating article on  Bottom line: Boomers in particular are not behaving the way their age would dictate, at least according to the traditional models.

The same is true of younger generations, as we’ve seen and commented on frequently on this blog. The Millennials are not, as a group, acting the way young- to mid-twentyish people acted in the past: they’re significantly “delayed” in their rates of marriage and family formation, and entry (beyond barista) into the job market. We’ve also noted, many times, that the “older” generations are acting younger than people of that same age in years past. So the idea isn’t totally new.

What’s I found intriguing in this report, though, is the degree of cross-generational activity and commonality: according to the head of music at the BBC, if you look at the 1,000 favorite artists of 60-year-olds and the 1,000 favorite artists of 13-year-olds, there is a 40 percent overlap.

Of course, age is still going to be a very strong driver of interests and behavior, particularly when it comes to money and health. But the assumptions of the past — that certain things kick in automatically (or stop happening automatically) at certain ages — are disappearing. Read the entire article for a sneak preview of a future in which the same people will act “older” and “middle aged” and “younger” at the same time.