By: Sandy Krueger and Larry Levin
Everyone in CPG is talking about millennials/Generation Y and even Generation Z, and how to prepare for these digitally-savvy and diverse up-and-coming shoppers as their spending power increases. While it’s vital to have a solid strategy for reaching these younger U.S. consumers, you don’t want to forget about a still-important shopper group, especially in certain categories – Boomers.
Last year, Boomers delivered $260 billion in CPG sales. While they had a moderate decline in the number of trips they made to the store, they drove nearly 5% growth in the refrigerated aisle. Refrigerated meats in particular were big with Boomers, as were protein and natural items overall. Boomers currently represent a hefty 41% of the total dollar volume for the refrigerated and frozen food aisles.
Boomers are also shopping more for these types of items in value channels like Dollar and Club. Sales from Boomers in the Dollar channel increased 14.3% for frozen items and 6.4% for refrigerated items while Boomer sales in the Club channel were up 1.3% for frozen items and 4.5% for refrigerated items.
Retailers and manufacturers have a great opportunity to capture new growth with Boomers, particularly in the frozen and refrigerated aisles where there are items already well-suited to their lifestyles. Here are three key areas to consider:
- Age matters when creating targeting claims. Like all shoppers, Boomers want to know the specific benefits they can expect from certain products – and then those products need to deliver. Boomers are especially selecting food items that claim natural ingredients, high protein, high fiber and gluten free.
- Assortment matters. Boomers are gravitating toward easier-to-prepare healthy frozen and refrigerated options, especially protein. Manufacturers and retailers must have correct product assortments on these shelves, whether brick and mortar or virtual, that will appeal to Boomers. This means understanding the demand of specific products and in specific channels at a very local level.
– Shopper targeting is critical. Not all Boomers are the same. Thirty seven percent use coupons to make their shopping lists and 29% won’t buy their first brand choice if it’s not on sale. IRI did a segmentation of those over the age of 50 and found six distinct segments – two of the most important (because they make up almost 50% of Boomer dollars), were the Conscientious and Secure segments. These segments like specific retailers and specific media. They are also the heavier buyers of refrigerated desserts and frozen seafood.
Boomers are extremely important to the marketplace and will remain so, with their CPG spending still expected to reach over $200 billion in 2020. Ignoring their specific product needs and preferences, and not having the right products on the right shelf, would be a mistake for manufacturers and retailers alike.
Want to know more about the different Boomer segments and how to reach them? Contact us at Sandy.Krueger@IRIworldwide.com or Larry.Levin@IRIworldwide.com.