JANUARY 2005 Times & Trends Executive Summary:
Aging Baby Boomers: Capturing Boomer Potential
Through Lifestage Transitions   

Times & Trends highlights new developments and critical events across all major CPG categories and channels, providing powerful benchmarking data to help guide your strategic decisions. This month’s Times & Trends outlines opportunities to capture share among the critical Baby Boomer segment as they make major lifestage transitions.

This free summary is also accessible via the GMA Web site  at http://www.gmabrands.com/publications/gmairi.cfm

Given the sheer purchasing power of the 78 million-strong Baby Boomer generation (now aged 40-58), it is imperative that marketers anticipate and proactively address changes in product needs and shopping preferences within this segment.

This unique look at Boomers explores purchase behavior at critical lifestages – “Under and Over 50” and “With Children vs Empty Nest.” The analysis illustrates the dramatic changes that can be expected within healthcare, CPG and retail as younger Boomers cross the age 50 mark and the majority of Boomer households become “Empty Nests” over the next ten years.

Here’s a summary from the brief:

Onset of Chronic Disease Drives Healthcare, Food and Beverage Growth Opportunities.
Rx, OTC and food and beverage products with disease management and special dietary benefits will see marked growth as younger Boomers (40-49) increasingly experience onset of chronic disease, which is far more prevalent after age 50. Manufacturer and retailer ailment-specific marketing programs targeting age 50+ consumers will become critical in capturing growth.

Boomer Beauty Care Spending is Not Likely to Increase Significantly Without Innovation.
Spending levels across most beauty care categories are similar among younger Boomers, older Boomers and consumers in the next age cohort, age 59-64. Thus, Boomer aging alone will not likely drive additional growth, but the market is ripe for innovation. Without losing focus on high-spending Boomers, marketers should also initiate targeted programs among Generation X consumers (particularly in eye cosmetics and hair color) and Echo Boomers (aged 10-27) – the next growth wave.

 
Convenience Meals Purchased by Hectic Boomer Families Likely to Decline.
With significantly higher purchase indices among Boomer households with children vs without, several convenience meal categories, including frozen pizza and dry packaged dinners are likely to suffer declines. As Boomers become Empty Nesters and reduce purchases of these products, the much smaller base of Generation X families will not fill the void. Manufacturers in these categories should explore opportunities to increase share among Generation X families and develop new products with adult appeal.
 

IA Greater Number of Boomer Empty Nests Will Bolster Sales of Wine and Spirits.
With more opportunity to relax and unwind, Boomers without children index 20-100% higher on spending across major wine and spirits categories than those with children. This scenario suggests a two-pronged marketing strategy reflecting needs and lifestyles of both groups to 1) capture expected growth as Boomers transition to Empty Nests and 2) increase penetration among Boomer parents.

Drug Stores Likely to Benefit Most From Rising Number of Empty Nest Boomers.
Across most channels, presence of children in the household is a stronger driver of channel share among Boomers than age. While Grocery channel share is roughly five points less among Empty Nests vs Boomer households with children, Drug Store share is nearly two points higher (on a much smaller base). Leveraging healthcare and preferred categories as a cornerstone, retailers should aggressively market to the rapidly growing Empty Nest segment, while manufacturers need to carefully track channel shifts.

Source: IRI's Times & Trends Reports
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