Consumers aged 50-64 are among the most affluent in Europe, yet food companies are failing to tap the potential of this market with their products and advertising.
A new report from market analysts Datamonitor shows that the European population is ageing rapidly, with the number of people aged 50-64 (or Seniors, as Datamonitor calls them) set to rise by 15 per cent from 127.4 million in 1997 to 147 million by 2007. This, together with the fact that Seniors possess high disposable incomes, makes it a highly attractive and profitable segment.
"This rise in number represents an interesting social phenomenon as well as an exciting, yet often overlooked opportunity for the packaged goods industry. Changing attitudes and consumption habits of both current and future cohorts of 50-59 year olds will herald a 'new-age' of Senior consumerism," said Daniel Bone, Datamonitor consumer markets analyst and author of the report.
Many Seniors aged between 50 and 64 are what Datamonitor refers to as Well Off Older Folk (WOOFS). The European average disposable income of this age group equates to €19,800 in 2002, compared to €25,324 in the UK where it is expected to rise to €27,487 by 2007. The drivers behind this income trend include empty nesthood, higher earnings, an increased likelihood of a large inheritance and lessening impacts of long-term financial payments.
High levels of inequality exist amongst Senior consumers, however. Those aged 65 and over are on a lower income and with the pension crisis deepening, there is little chance of the gap diminishing. Consequently, principles of saving and simplicity remain highly applicable to Senior consumerism, particularly for older consumers who possess more conservative values stemming from their generational experiences.
Europeans now turning 50 mark the first generation of mass consumers who have grown up immersed in a consumer culture. Consequently, the manner in which they will behave and consume will be markedly different from their parents. They have grown up using brands to help construct their identities. The desire to be seen consuming the right products is a need that will accompany them in the Senior lifestage. As a result of increasing hedonism, an innate fear of ageing and their consumption history, Seniors are more and more likely to become adopters of so-called youthful brands, Datamonitor suggests.
"Contemporary Seniors are also subject to greater influence from their children. Due to delays in the average age of first births and a growing tendency for young adults to remain in the parental home for longer, current and future cohorts of Seniors will be subject to growing influence from their offspring," Bone said.
"This will only further enhance their tendencies to adopt consumption habits typically associated with youth culture."
Seniors are also individuals
Although there remains a tendency to see Seniors as an homogenous group, Datamonitor's report shows that the over 50s across Europe are a highly diverse group of individuals, both in terms of attitudes and lifestyles.
In order to capitalise on the growing number of European Senior consumers and their comparatively high disposable incomes, marketers must show greater sensitivity to their changing lifestyles, the report suggests.
With a new generation of Senior consumers and a blurring of values between the so-called 'older' and 'younger' age groups, food companies and other consumer packaged goods manufacturers should follow the example of firms such as GAP in realising that they must make fashionable products available to and inclusive of Senior consumers. GAP's 'ageless' campaigns partly account for its popularity with mature consumers, especially those seeking to retain cool credibility.
However, a significant reason for advertisers shying away from consumers over 50 is the conventional wisdom that they are very brand loyal and less likely than younger people to try new products.
"This is perhaps the greatest marketing myth associated with Senior consumers and stems from historic and stereotypical references," said Bone. "In reality, many Seniors are moving into a new phase of life ready to experience new things, particularly once they are unencumbered by children. Critically, food purchases tend to come into line with food preferences once the kids leave home simply because there are fewer people to please. They have more time to focus upon themselves and this is often reflected by different consumption patterns."
Cynical Seniors hard to sway
But Seniors are certainly less likely to be swayed by advertising, with age often making them much more cynical, the report claims. Most marketing campaigns and associated advertising messages are targeted at young people, and those that do speak explicitly to Seniors often have a tendency to stereotype and patronise their lifestyles or for the advertisement to lack relevance, Datamonitor said. Marketers continue to show reluctance in using older models in advertisements even though the over 50s want to see more people their own age in commercials.
"Given that the world of advertising has evolved away from simplistic structures to abstract messages that are inappropriate for older people, Seniors have become increasingly cynical of advertising. This means they often turn to friends and family as more trusted and credible sources of information," Bone said.
"Marketers can communicate to Seniors by embracing Senior specific media as well as portraying Senior lifestyles more positively through the use of active images which illustrate their enjoyment of life thus leveraging the positive values of maturity."
For details of how to buy Datamonitor's report Targeting Seniors Effectively, click here.