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Published: November 30, 2006

 
 

Best Business Books: Marketing

One reason is that the number of older consumers is growing faster than the number of younger ones, and they are the main purchasers of transportation, health care, housing, food, pensions, and personal insurance. Older consumers can be more lucrative. They have higher incomes, enabling them to buy 35 to 50 percent of all travel services, 65 percent of all new cars, and 50 percent of face care products.

Why is there such abysmal ignorance of the realities of the 50-plus market? One reason, of course, is that archaic truisms are perpetuated rather than researched. These so-called truths include “to be cool, you have to be young” and, my favorite, “their lifetime value is too short.” Another reason is that the advertising and marketing industry is overwhelmingly youth-centric. More than 80 percent of those who work in the U.K. advertising industry are under 40.

Stroud outlines “three truths that should be emblazoned on the front covers of all books about marketing: there is no simple formula linking a person’s age to how they behave as consumers; when age does appear to be linked to differences in behavior, the variations are small; and the behavior of older people varies by nationality.” In other words, the relationship between age and consumer behavior is tenuous, at best.

If the 50-plus market is so attractive, what are the best ways to approach it? One key is not to generalize about the way seniors behave. Another is segmentation by criteria other than age. For example, not only is 50 an arbitrary age, but chronological age also differs from perceived age. Generally, we see ourselves as being 10 to 15 years younger than what our driver’s license tells us. One method of segmentation gaining ground is geodemographics. Now being used by American Express, Reader’s Digest, and other companies, geodemographics classifies consumers according to the type of neighborhood they live in. Such markets can cross age boundaries.

So is age meaningless in marketing? No, but Mr. Stroud suggests that age be considered from a physical, not psychological, vantage point. This means that companies need to make and market products that accommodate declining senses of touch, smell, and eyesight, as well as loss of hearing and manual dexterity.

The appendixes in 50-Plus, which cover design factors for senior consumers, guidelines for age-friendly Web sites, and a test to determine whether marketing strategies are age neutral, are particularly useful.

The book successfully examines a market that has been overlooked as a result of decades-old myths, lack of research, and the narcissistic, youth-oriented makeup of the advertising industry. This is an excellent book for companies looking to stay ahead of an inevitable demographic change instead of being swamped by it.

Help for the Aging Brand
Most branding books focus on building products into brands, but there’s another important issue: sustainability. How do you support and maintain a brand over time so that it continues to pay back earlier investments? How can you pump new life into an aging cash cow? How can you connect with new generations of consumers? According to Brand Rejuvenation, “a brand ages in the eyes of its customers and/or its consumers because it loses its appeal, its relevance and, usually, all or part of its identity.” What causes a brand to age, and more importantly, what can be done about it?

The first step to brand rejuvenation is to conduct a brand audit to determine whether the brand is aging and has enough long-term potential to justify rejuvenation investments. Jean-Marc Lehu, an associate professor of marketing at Panthéon Sorbonne University, provides a scorecard to help. The symptoms of aging include a slowdown of new product launches, nonconformity to technological standards, out-of-fashion colors, increasing average age of users, declining number of customer contacts, and an aging sales force. The brand audit must also cover communications, looking for such weaknesses as an irrelevant brand spokesperson, old-fashioned packaging, and — horrors! — “ad campaigns not (well) ranked in ad festivals and contests.” (Nothing in this brand scorecard mentions declining sales or profitability.) The audit’s results are graded according to the following indexes: the potential danger of the symptoms, how easy the problem is to solve, the potential cost, and the time required.

 
 
 
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