In their rush to capture the attention of the next generation, brands must not forget cashed-up Baby Boomers who are becoming more technology literate, according to a new study.
While brands do much to target the elusive Gen Z and Millennials, Boomers, with their bigger wallets and still significant size – the cohort will lead to a doubling in the number of people aged over 60 to 2 billion by 2050, according to the Milken Institute – are emerging growth opportunities for brands, a new report by big-four consulting firm EY said.
“The Baby Boomers are a substantial segment of the market in Australia,” EY Oceania managing partner for consumer markets Jenny Young told The Australian Financial Review. “They’re 25 per cent of the population and they’re very digitally engaged, 20 per cent of them will spend more than 20 hours a week online.”
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Globally, there will be more Baby Boomers, those aged 65 and older, than children under the age of five by 2020 for the first time in history.
Ms Young said brands, media and entertainment companies have an opportunity to capture the relatively well-off consumer segment by understanding the features the older generation prefer in their products and services.
“While Millennials and Gen Z are new segments with more difference in their consumption, the Boomer segment is a very wealthy, large and digitally engaged segment,” Ms Young said.
“Media and entertainment companies in Australia need to broaden their customer strategies to include this group or risk missing out on a huge market segment. The use of data to understand this customer segment and providing personalised experiences will also be key to capturing this market.”
Separately, the EY study found growing concerns around data, security and privacy. However, consumers are happy to hand over their personal data to brands and media companies as long as it is used to improve their experience – for example via targeted and more relevant advertising – and it is kept securely.
“Increasingly there will be data exchanged, the transparency point is important. If we are capturing customer data it has to be very clear that it’s being done and how that data is going to be used,” Ms Young said.
“The level of expectation is very high. We should think about what we do, rather than what is the minimum requirement.”
The study found 70 per cent of Australians are comfortable providing personal data if it improves their service experience. But, that comes with expectations of security and trust.
“I think more importantly though brands and businesses that stay well ahead of those minimum requirements will have a clear advantage because they build greater trust,” Ms Young said.
“They understand how to use data productively to improve service and that intent is valued by customers.”