By Susan Viamari
Today, baby boomers and seniors account for the majority of all CPG expenditures. Over the next 25 years, the population of Americans aged 65 and older will double, and spending by this group will exceed $230 billion in less than a decade. This segment of the population spends heavily on healthcare, and embraces proactive prevention in attempt to minimize the need for disease state management down the road.
With these significant statistics in mind, CPG marketers should develop strategies focused on activating these shoppers, as increasing market share even slightly can translate into hundreds of millions of dollars in increased revenue. Our latest Times & Trends report, “Aging America: Carving Out Growth in Mature Markets,” examines the consumer behavior of boomers and seniors, and offers market insights into how this sizable segment will shift throughout their golden years.
To help CPG marketers maximize growth opportunities with this large and growing segment, “Aging America: Carving Out Growth in Mature Markets,” also outlines three strategies to engage and activate boomers and seniors.
CPG retailers and manufacturers must invest to understand mature consumers’ current needs and wants and use that knowledge to identify opportunities to simplify and expand ongoing wellness-related efforts. IRI’s 2014 New Product Pacesetters study showed that healthier-for-you products and product innovations are making a huge splash with consumers; and while health and wellness products include prescription medications and typical over-the-counter healthcare solutions, healthier-for-you is not limited to the healthcare aisles. Instead, CPG retailers and manufacturers should seek opportunities across store aisles.
Educational programs and messaging are solid activation tools within the mature marketplace. In order to stave off the high costs incurred by chronic disease, this segment has embraced proactive self-care, prompting above average sales growth in products such as vitamins and gastrointestinal liquid. CPG retailers and manufacturers must have an intimate understanding of what health concerns and conditions older consumers are facing and educate them on ingredients/products that will help them prevent and/or treat these conditions. It is critical to clearly communicate product benefits to boomers and seniors.
Finally, to effectively reach older consumers in the home, where many purchase decisions are being made, marketers must integrate digital media into their marketing programs. Though traditionally boomers and seniors skew more to circulars and coupons, more than 27 million people over the age of 55 are now using social networking sites, with upwards of 59 percent reporting daily use! As technology becomes more commonplace in mature households, CPG retailers and manufacturers must integrate traditional and new media strategies in a way that reflects progression along the adoption curve.
Unprecedented size, growth and buying power makes the mature marketplace a must-win for CPG marketers.Developing an adept ability to serve the many and varied needs of this disparate marketplace concisely and consistently will require frequent and granular assessments of consumer needs and near real-time implementation and management of finely tuned shopper marketing programs.