Why Grey Is Golden
Curtis, James, Marketing
Oldies, wrinklies, grannies - why target them? How about because they control 80% of the nation's wealth and account for 40% of all spending.
In the eyes of the marketing community, this is a nation of Tango-drinking, Nike-wearing groovers suspended in a never-never land of eternal youth.
Society, of course, is not like this. The data shows that the bulk of the population is getting older and it is the over-55s with the majority of the spending power. Despite this, 95% of all European advertising and marketing continues to target youth.
Advances in medicine, better eating habits and healthier lifestyles are all contributing to a dramatically larger ageing population. According to the United Nations, worldwide there were 0.2 billion people over 60 in 1950, but in 2025 this will have jumped to 1.2 billion. Living to 100 may soon no longer warrant a telegram from the Queen - in 30 years' time the number of centenarians in the UK will quadruple to 34,000.
Coupled with this are trends that show the extent to which the over-55s control the nation's purse strings. According to Help the Aged, this group controls 80% of the nation's wealth, and spends [pounds]145bn per year (about 40% of consumer spending). They also hold 60% of UK savings and are by far the biggest spenders on drink, cars and leisure Of all new car sales, 65% are to the over-50s.
That marketers are sent into a creative torpor at the mention of the term 'grey market' is well known. But there is a rising clamour for the marketing community to get its act together and bring itself in line with the gigantic demographic shifts changing society. In the future, marketing is going to have to change, but how? The change involved with an ageing population is so far-reaching that many wonder if advertisers will ever get their heads round it.
At the Future Foundation, which has investigated the ageing population in its study 'Exploring the Network Consumer', director Melanie Howard says: "These massive shifts will affect all aspects of life and marketers are more unwilling than most to take them on board.
"It's not about feeling old, but about living longer and more fulfilling lives. There are fantastic opportunities here for marketers, but they seem to struggle to conceive of age in positive terms. They are too riddled with stereotypes," she adds.
As well as the opportunities longevity holds for sectors such as leisure, it presents challenges for areas such as financial services. The question of how people pay for their longer lives, for example, becomes a key issue. "People will either have to work longer or save more when they are younger," says Howard. "This will reduce spending power at a time when people expect it to be at its peak and creates a fundamental shift in the way you have to look at consumption patterns at different life stages."
Leon Kreitzman, director of Maturity Marketing, a consultancy specialising in marketing to older people, has little faith in the marketing community's ability to meet these challenges. "If you ask me if advertisers can rise to it, I'd say no - because they are not innovative enough, they are too conservative and they are frightened of change," he says.
The way forward
To understand the changes the industry needs to make, we need to take stock of the problem as it stands. The first issue is summed up by the term 'grey market' itself - revealing a tendency to lump the over-55s into one walking stick-waving group. While advertisers are adept at dissecting their younger customer base, they research and understand very little about what makes the older consumer tick.
Martin Smith, who left Saga to set up Millennium Direct, another agency specifically targeting the older generation, says clients "still make curious statements about over-55s being a 'niche market' and bracket them off. But would they try to put people in their teens to mid-40s in the same bracket? …