Sales Plummet as Birth Dearth Arrives

Article excerpt

According to a demographic study commissioned by KGA Advertising, Middletown, Conn., businesses that continue to view the 18-34-year-old market as a lifeblood to their success either are currently on life-support systems or already have succumbed to this misapprehension. The marketplace has lost thousands of once powerful industry leaders nationwide to this type of thinking. The motorcycle industry demonstrates the most dramatic example of a business that was wiped out because of its precipitous fall in sales. Over-all unit sales plummeted from 1,200,000 in the mid 1980s to 400,000 over the next five years.

KGA Advertising, which had the North Eastern American Honda Motorcycle account at the time, sought to discover why an entire product category was wasting away. According to Ken Gronbach, KGA president and CEO, "it's the birth dearth -- a cyclical population phenomenon that historically has impacted our economy, but that has not been widely recognized or understood before now, and as a result has taken marketers by complete surprise."

The enormous group of "baby busters," people born between 1966 and 1976, has moved into the coveted 18-34 age group that the baby boomers, a market of some 76,000,000 individuals, have exited. The baby buster generation that resulted from the birth dearth in the 1970s is 50% smaller in size. As the first boomers turned 50 in 1996, this massive trend-setting market with its unprecedented buying power that has commanded the marketplace for the last 30 years began its metamorphosis from the youth market into the mid-life market. The boomers leave a huge void in the marketplace that, by virtue of sheer size, is impossible for the birth dearth generation to fill. …