Dont neglect boomers
Born between 1946 and 1964, the 80 million baby boomers in the United States \"have been largely unaddressed by marketers and advertisers since they started to age out of the popular 18-49 cohort,\" according to \"Introducing Boomers: Marketings Most Valuable Generation,\" a 2012 report from Nielsen and BoomAgers, both of New York. But boomers present a significant growth opportunity on the store brand side for retailers willing to understand them and market to them.
Key to doing so, says \"Baby Boomers: Riding the Wave of Diversity,\" a September 2012 Times & Trends report from Chicago-based IRI, is breaking the generation down into two groups: older boomers and younger boomers. Older boomers were born between 1946 and 1955. Younger boomers were born between 1956 and 1964.
Since boomers are not a homogeneous group, sweeping ad campaigns and marketing strategies will not be effective in drawing in business, the IRI report says. Instead, highly targeted strategies will win dollar spend and create loyalty.
\"Life stage has more commonality than generation,\" notes June Jo Lee, vice president of strategic insights, the Hartman Group, Bellevue, Wash. \"So there is a very distinct empty-nester boomer and the boomer who is still very much like Gen-Xers who still have kids in school or college and are still being that active parent.\"
These two different life stages significantly impact shopping and spending behaviors. But as a whole, boomers want to be healthy and active.
\"Essentially, at the end of the day, higher-quality food really represents healthier food and this notion of food as medicine,\" Jo Lee says. \"Boomers dont want to get on the prescription medicine track, so they are doing everything they can to eat well. This means more fresh foods, herbs, spices, produce, grains, dairy and less highly processed foods.\"
But food-related wellness behavior differences exist between older and younger boomers. \"Riding the Wave of Diversity\" states that while 41 percent of older boomers eat whole grains, only 35 percent of younger boomers do. Additionally, while 27 percent of older boomers eat omega-3-rich foods, only 21 percent of younger boomers do; and while 59 percent of older boomers take a multivitamin, only 48 percent of younger boomers do.
Store brand or \"generic\"?
Regardless of whether they fall into the older or younger boomer category, baby boomers in general are value-driven and cost-conscious, Jo Lee says. Many younger boomers are financing college students and saving for retirement, while many older boomers are retired and living off a fixed income.
Store brand products would seem like the logical choice for either set of boomers to save money, explains Susan Viamari, editor of Times & Trends for IRI.
But this generation grew up with store brand products labeled as \"generic\" – a negative term – and only recently has seen private label products evolve into a much more sophisticated offering. Unlike millennials, who no longer see brands, just products, boomers have had to overcome their own initial resistance to using store brands, Jo Lee says.
However, two areas where private label spending does rank very high among boomers are over-the-counter healthcare and beauty/personal care. These categories appeal to boomers desire for value, with the IRI report showing that consumers save an average of 44 percent and 64 percent when they choose store brand products over their national brand counterparts in the healthcare and beauty/personal care categories, respectively.
IRIs report also states that spending by older boomers is above average in 70 percent of healthcare categories. And data from an IRI MarketPulse survey help explain why: More than one in four consumers over the age of 65 are self-treating for simple ailments.
\"In general, as we age, our spending on healthcare gets higher. For boomers, store brand products are a great opportunity to rein in spending while addressing healthcare needs because they get the same active ingredients, the same effect, for a lower price,\" Viamari says.
But since 2009, more and more boomers have been making the switch in other categories as well, Jo Lee says. Why? The Great Recession created an even more value-driven, cost-conscious boomer, and during this time, Trader Joes, Target and Whole Foods, among others, began aggressively expanding and transforming the concept of private label from a generic label to a true brand that represents the store, she explains.
When boomers make the switch to store brands, they may find premium private label products to be very attractive, Viamari says.
"Boomers, and older boomers in particular, generally struggle less with respect to affording groceries. Therefore, there is more opportunity to capitalize on their propensity to splurge. Private label options help them to be cautious in their spending, but theyre willing to trade up to that premium private label brand," she says.
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