 What
is the one word you’ve probably heard and read more than any
other during the last 18 months?
It’s contained in every third headline for articles on
LinkedIn or in top publications like Fast Company and
Fortune. It’s a word that represents a group that marketers
have been dissecting and hypothesizing about ad nauseum.
If you guessed “Millennials,” you win!
For the past few years, marketers have been obsessed with
this enigmatic generation. This group of young people has
confounded brands because they are so different from every
other generation that has come before them. Although, are
they all that different?
Regardless, marketers have been tripping over themselves
trying to figure out how to curry favor with consumers
between the ages of 20-35.
But not that long ago, albeit without all the social media
hype and constant hand-wringing in the business and cultural
media, marketers were doing the same thing with Baby
Boomers. This was the consumer set everyone wanted.
Parenthetically, those in my agency who consider themselves
Generation X are a tad bitter over no one ever losing their
minds about them. But they’re used to it.
Today, however, it’s all about Millennials. But should it
be? Are marketers missing opportunities by focusing too much
attention on Millennials and not on Baby Boomers? Or are
these younger consumers truly as important as is
(constantly) being reported?
The answers to those three questions are, it depends, yes,
and yes.Story
continues below ↓
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The Case
for Millennials
When it comes to home ownership, Millennials have
traditionally been thought of as the “Renter Nation.”
Because of crushing student debt, modest job growth, and
cultural influence, young people have eschewed buying
homes.
Or have they?
As it turns out the American Dream wasn’t forgotten,
just delayed. According to a survey by Zillow, the home
market is increasingly being driven by Millennials.
The survey found that half of all home buyers in the
U.S. are under the age of 36, and just under half are
buying their first home.
Zillow attributes this to the maturation of the
Millennial generation, something which is just starting
to occur. Millennials, according to their press release,
are seeing homes as a good investment and are embracing
the same romantic notions of home ownership as their
grandparents.
How they’re going about entering the market, with their
trademark internet savviness, shouldn’t surprise anyone.
They are using all of the digital resources they have at
their disposal — brand web sites, media websites, social
media — to inform themselves and make better decisions.
Interestingly, they are also relying on more
traditional, offline sources, but demanding more from
them. Zillow reported that many Millennials are looking
to real estate agents for advice on strategy and
remodeling ideas, in addition to the business of buying
a home.
Of course, Millennials are not willing to settle for
cookie-cutter solutions. Their criteria for the ideal
home reflects their individuality, their desire for
smarter homes, and their concern for sustainability and
energy efficiency.
Millennials are embracing the American Dream of owning a
home, a trend that will only continue as the bulk of the
generation matures. They are clearly the future of the
home products market, as evidenced by builders like Toll
Brothers adjusting their offering to accommodate younger
buyers.
The National Association of Realtors claims that 35% of
all home purchases are currently by first-time buyers…
up from 32% last year, increasing their growth
trajectory towards the historical target of 40%. But the
future isn’t here just yet. Baby Boomers are the
present, and there is one thing they have more of than
Millennials. By a huge margin.
The Case for Baby Boomers
Some might think of Baby Boomers as a generation of the
past. But here’s the thing: there are a lot of them, and
they don’t intend to go away soon, or quietly.
During a presentation at the Chief Housewares Executive
Supersession in October, author Peter Hubbell made the
case that marketers ignore Baby Boomers at their own
peril.
The main reason is that Baby Boomers have money. Lots of
it.
First of all, they are not retiring at 65 like their
parents did, so they’re not done with their earning
years. Many are still working, at least part-time, well
into their 70s. Also, they stand to inherit an
astonishing $15 trillion over the next 15 years.
That all adds up to huge purchasing power, dwarfing that
of Millennials, or any other generation, for that
matter. In fact, Baby Boomers currently control about 70
percent of the nation’s disposable income.
What are they doing with that wealth? Well, whatever
they want! They are approaching the idea of aging on
their own terms. They are staying in their homes as they
age, with 78 percent saying they’ll have to be dragged
by the ankles to get them into a nursing home (we’re
paraphrasing).
And in their homes, they don’t want compromises. They
may be simplifying a bit to permit them to do more
travel, but they don’t want to sacrifice quality or even
luxury.
Accessibility is an important aspect to what they want,
too. Sooner or later, their bodies will start to fail
them. To allow for their age-in-place intentions, Baby
Boomers are demanding homes and products that will
accommodate them for as long as humanly possible.
Like all Americans, Baby Boomers want what they want
when they want it, and lots of it. The difference is
they have the cash to buy it.
Living Together
An interesting wrinkle in the Millennial-Baby Boomer
debate is the rise of multi-generational homes.
According to the U.S. Census Bureau, the number of
Americans living in multi-generational households has
doubled since 1980.
At least two dynamics can explain this: more young
people moving back home after college, as they struggle
to pay off student loan debt, and more aging parents
moving in with their kids to avoid the “old folks
homes.”
Either way, this presents an opportunity for builders
and product marketers to accommodate both generations.
And if they want to throw something in for the Gen Xers,
we’re sure they’d appreciate it.
That opportunity also embodies what we believe to be the
best strategy for brands. Millennials are the future,
without question. Any forward-thinking company knows
that focusing on the future is a good idea.
But Baby Boomers are the present and their immediate
future. The immense buying power will still be here 10
years from now, and ignoring it would be foolish.
So, focus on the now, but don’t lose sight of the
future.
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