"Leaders have to be ready to adapt, to move, to forget yesterday." Tom Peters
Tom Peters says of Marketing to the Mindset of Boomers and Their Elders: "I literally shook with excitement as I devoured these pages. This book is a gem and a true original—and long, long overdue. The marketing potential described therein is measured in the trillions of dollars-and almost no one is paying attention."
tompeters.com spoke with coauthor Carol Morgan.
Who should read this book?
CM: The ideal audience are marketing people, clearly. I would also think that anyone interested in the mature market-for example, a government entity that's in charge of social services. Even if they're providing services that we pay for with our taxes, they are still trying to market their services and hopefully trying to make their clients happy with the quality and extent of their services and how they're delivered.
I also see non-profits as a market or an audience to this book; people who need to raise money and want to get donations from the older and mature market. It is this group of people who donate the greatest amount of money to charities and such.
When you say mature market, is there an age range that you're referring to?
CM: We include baby boomers who are now in their late 30s to people who are 90. There's a huge range in terms of age. For the actual research that we did-we started our research in 1989-we studied people 50 and older. Then in 1994 we decided to include people 40 and older. Since 1994 we've really focused on people 40 and older, and all the respondents in our studies live independently. The oldest one's about 88 years old.
Your book is about marketing to baby boomers and their elders, but you make the point numerous times that there is a general misperception among marketers and the media that baby boomers are this block of people that thinks alike and does everything alike, and you point out that this is far from the case. Why this misperception?
CM: From a larger, more general perspective we would say that in essence marketers are doing this to every market. Whether it's Generation X or Generation Y, you can still read articles that say "Gen Xers are blank, blank, blank." So it's this mass marketing mentality that, without going into why, just finds it a lot easier to deal with this one cohort or this one generational group. Marketers and advertising agencies buy media according to a demographic.
The whole system traditionally has been set up to facilitate this mass marketing mentality, and it's as if once you introduce this idea of segments or sub-groups within these cohorts or these generational groups, then it becomes more complicated. At that point you're really acknowledging that mass marketing isn't working well, that there's this tremendous splintering of the mass media, and that you really have to start looking at niches and smaller groups.
So in terms of why this kind of mass approach is really bad for the mature market is that as we grow older and have more diverse experiences, we really become more unalike. If someone were trying to market cereal to a group of six-year-olds, because they've had so few life experiences-of course there are still psychographic segments within the six-year-olds-you can more easily get away with a mass approach. When you're talking about people who are 40 or 62 or 85, they've just lived through a lot and they've had radically diverse life experiences.
This viewpoint is supported by sociologists and gerontologists and psychologists, so I think what happens is that the mass marketers become overwhelmed by the diversity of this group and it just becomes very difficult for them to tackle it. I think that's one reason for this kind of avoidance of the mature markets.
Because of their life experiences and because their lives are so complicated and so diverse, this older and mature market is this seeming morass to wade into for most marketers, who don't have that much time to figure out these different niches.
CM: Right. It's something that's difficult to look at, and then as I said, their minds are wrapped around this mass marketing mentality, and they're always looking for the average-the average retiree. How many times have we read this: "with the average baby boomer." It's a myth. There is no average person that you'll ever encounter on the street. These marketers are taking the polarities or the extremes, and then homogenizing them to a center.
A center that doesn't actually exist.
CM: Right. It doesn't exist. What happens then is that you're in one segment and I'm in another, but the marketers are congealing that and homogenizing toward the average. The result is that you're not going to be happy with the products that they provide for you and you won't relate to the messages that they're using in their advertising. The whole thing really doesn't work very well.
You've mentioned psychographic segmentation. What do you mean by that?
CM: In our book I point out that a lot of people confuse psychographics with lifestyles. To us they're really very different. When we talk about psychographics we're really talking about motivations and attitudes that represent, say, deeper values. But they're concrete emanations or tangible statements of what motivates people, what their attitudes are. The questions we pose in our surveys are things such as, "I think it's really important to go to church every Sunday." We're asking do people agree or disagree with that kind of statement. That's what we're measuring.
A lot of people look at lifestyles. They see that a person is, for example, golfing frequently. Because they are acting out this behavior, the marketers infer a psychographic. That's inaccurate. It's not something that can be supported.
Meaning that a lot of people look at a golfer and say, "Okay, the average golfer is this kind of person." But you're saying that the important factor there is what is motivating that person to become a golfer?
Some people are doing it for social reasons; some people are doing it for exercise—though I find that a little bit laughable. But, you know, they're out in the fresh air, anyway. But so there are the different motivations, which is what you say matters?
CM: Consider the present time. Companies are slashing their marketing budgets, companies are talking about return on investment as never before. They want to get the greatest efficiencies and effectiveness out of the marketing dollars they spend. We're saying that if you start with psychographic segments and you know that this segment or segments is receptive to products, then at least you know they're interested. But what you've got instead-and I think it's delusional thinking-is advertisers thinking that if they pummel you a sufficient number of times with their messages that somehow you'll be convinced to buy their product.
Off the top of my head, about 15 percent, for example, of the people who can afford to buy a luxury car actually buy this type of car. The other people who can afford to buy a Cadillac or BMW are not motivated to do that. Why advertise to them? Again, you come back to the mass media kind of strategy, where they'll advertise in BusinessWeek or Fortune or whatever, so they're just going to reach all of them. But that's inherently wasteful. When you have the capabilities and the data to support more targeted strategies, this mass media approach is just something you can't support.
A myth you debunk in your book is that people in this mature audience have already settled on all the brands that they're going to buy and that this is one of the reasons marketers don't go after them. They figure these folks have been buying whatever it is they're buying for a long time and are unlikely to change. And yet you're saying, no, that's not true. Can you talk about your evidence for that?
CM: Our largest piece of evidence against that conclusion is in the food chapter of the book, where two researchers in England had gone through incredible amounts of scanner data and actually tracked what was being purchased and the brands they purchased, I think, for 16 different types of products. They found that the problem essentially lies in the way purchases are measured. Once you look at household consumption and you look at households that typically in the mature market are composed of one person or two person households, it simply takes longer for that one person or two people to consume mustard or ketchup or whatever the product is.
But if you look at it for a longer period of time and look at it on a more individual basis, then you'll see that folks in the mature market use the same number of brands that young buyers do. This brand loyalty myth of the older buyer is also paralleled by this idea among marketers that if they get them young you've got them forever. I went to a Jesuit college and the Jesuits have this notion that if you got somebody at a young, formative period, you could really shape them forever. And so it's the same thing of, say, car companies pummeling an 18-year-old with its advertising, thinking that if they buy a Ford at a young age they'll always buy a Ford.
But the actual behaviors, especially among Generation Y, are of people who are very flighty and have absolutely minimal brand loyalty. Think of yourself. Are you buying the same brand of toothpaste now that you were buying 20 years ago? I doubt it.
My mother probably used Tide as clothes washing detergent for pretty much her whole life. I wonder if some of these ideas about brand loyalty actually are these current marketers projecting from what our parents did. It's not true for ourselves, but we have this image of that occurring in older people, meaning our parents. But older people now, it's clear, are not the same kind of older people that our parents were.
CM: Just in terms of the proliferation of brands you could also argue that in your mother's time perhaps there weren't that many choices of brands. Now we have different types of washing machines that demand different kinds of washing compounds; it's all much more complicated. And there's always a segment that's driven by cost. Brand doesn't matter to them; the best price does.
Tom Peters has been talking about what a huge opportunity this women's market is and how no one is taking advantage of it, which is a point of view you would agree with for the most part. But you make the point that the financial services companies are wasting their money by trying to target women as a separate market from men. Can you talk about why that's the case?
CM: I just found that there was this disconnect because I'm concluding that they're marketing to more affluent women who have something to invest. When we look at our "savvy investor" segment, it's composed of the same percentage of men and women.
And the men and women in this group have the same motivation for investing?
CM: Exactly. Whether it's a female savvy investor or male savvy investor, these are people who like reading about investments, these are people who have diversified their portfolios, they know how to use money, they borrow money. They just are comfortable with money and they take advice from a variety of sources and then formulate their own strategy. Male or female, their mind set is the same.
The disconnect is that Charles Schwab and these other companies are attempting on one level to reach women who have something to invest, whether it's $100,000 or $200,000. But their tactics are really inappropriate. If you told me that they were going after women with $30,000 to invest, that's a different thing. Maybe then they're going after "worried frugals" or "strapped spenders" or those other attitudinal segments that do need help. Maybe what they're doing is more appropriate to these other psychographic segments. The disconnect, though, is that women who have huge chunks of money are not babes in the woods, you know, and would not go for programs that combine how to pluck your eyebrows with how to invest your retirement money.
There's one example in the book of a company that combined a fashion show with a financial seminar. I think I also quoted Jane Bryant Quinn as being insulted by that kind of approach. I do agree with Tom Peters that the whole women's market is being ignored. One of the next books I would love to write is essentially on the mature woman.
CM: These are the women who at 60 or 65, when their husbands die, are left with huge amounts of money and ...
Exactly. I've read that they're going to be the wealthiest group of people ever known to mankind—right?
CM: They will have huge assets. I have thought that the financial companies are trying to reach that really affluent group, but it's just the way that they're doing it is inappropriate and also, I would say, unnecessary. But that mature woman is a really attractive target. But again, I don't see that many companies going after this market.
You suggest that marketers have to go beyond merely collecting transactional information in a database. You offer a type of solution. Can you talk about that?
CM: It goes back to the idea that most marketers would agree that knowing why somebody is doing something would give you a huge advantage in terms of products or services or how these products or services are delivered, a predictive kind of vision or view of the customer. Demographics at this point are really almost useless, very weak in predicting behavior, and explain a very small part of why someone actually does what he or she does. Behaviors are sort of a step up, but they're really weak in terms of either dealing with a new product or in introducing a product to essentially a new market.
That's our point about baby boomers and their elders. They haven't retired before, haven't aged before, and so they're really a new market for whom there is no database of behavioral information. Instead of looking at demographics, behaviors, for us the next step would be to categorize people in databases by an attitudinal tag, and to know then that these most probably would be the people who would be more interested in a golf club. It's not that they're golfing frequently, but they have an attitude toward playing golf which includes a need to buy better golf clubs and have the latest equipment and have the most technologically advanced equipment. You don't get that particular piece of information just from knowing that this is a person who golfs twice a month.
In a lighter moment you pick on the Viagra ads, suggesting that they're using the wrong kind of imagery. It's the one where it shows two people dancing and the implicit message is that there will be sex after dancing. Viagra will see to that. But you say that that's not really right for the target audience.
CM: If the ad is selling a fantasy, then I guess the ad is fine. But I think I suggest that the number of people 40 and older who actually go dancing is, you know, infinitesimal. It's a tiny percentage of the population, five percent or so. If what the Viagra ad was selling was the fantasy of this kind of closeness and making it more palatable for women, then perhaps this approach works.
But the reality is that the people who need Viagra are more typically blue-collar people who drink a lot and smoke and eat greasy food and haven't been taking care of themselves. That's really more the actual market for that product.
Of course that doesn't seem to conjure up a pretty ad.
CM: Well, no, but the people who are going to identify with an attractive couple dancing probably aren't the people who need Viagra, so why bother? The whole idea is to appeal to the audience that actually has a desire for the product. That's our whole point. There is an ideal audience for the product; it's a matter of doing the research to find that segment.