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Marketing Strategies targeting the Grey Market (Over-55s)
For many of the contemporary marketers, one segment of market or consumers that matter most is the senior market, typically referred to as the ‘grey market.’ The average lifespan in the United States and many of the Western nations has gone up by 30 years in the 20th century. One of the most important thing for marketers to realize is that, these extra 30 years were not docketed to the end of an individual’s life, but were rather inserted into the middle of the person’s life, precisely at an age when people are energetic, dynamic, productive, engaged in their social life, enthused about new experiences as well as learning new things, and with the modern day generations of the over-50s and 55s being technologically well-connected.
Generally, markets are determined on the basis of the supply and demand of the products/services that are exchanged, and are sized by the cumulative amount of cash that is spent on the procurement of the products/services. This further indicates that the 50+ market is extremely large, with consumer expenditures going beyond $3 trillion.
In the year 2012, the number of people over “50 reached a figure of 104 million - 61 million people ages 50-64, 37 million ages 65-84, and 6 million over 85 years of age. By 2020, the number of people over 50 will number 118 million, and by 2030 132 million.” This indicates that, in just three decades between the year 2000 and 2030 the number of people above the age of 50 will be more than 70 per cent, and people above the age of 65 will denote 1 in 5 Americans in 2030, says the American Census Bureau.
The Baby Boomers fall into the category of the 50+ population; and the last group of these have turned 50 this year. This generation has transformed markets and the whole world as well, at every single stage of their life experiences. They are dynamic in nature. Their orientation about their current stage in life is that it is more about living and does not bother about aging.
This particular segment of the population do not wish to be branded and labelled. They grasp opportunity everywhere, even in times of adversity. They independently seek ways to improve their lives. They have a constant desire to develop, learn and discover, and have a positive attitude towards their future. They are always open to change while also being open-minded to new experiences in life. For this population, it is always about “what’s next.”
Similarly, if the case of UK is considered, for instance, the people falling in the age range of 50+ have 80% of the total national wealth. “In EU, 75% of the nation’s wealth is held by the over-50s. The over-50 age group is responsible for the majority of household expenditure (54%) in the US and half of consumer spending across the EU.”
Irrespective of this segment of the market being so massive, the unfortunate thing according to a new research conducted by Media Vest, Ireland is that advertisers and marketers are ignoring this segment of market as their focus is more on the younger lot, the so called Gen- Y.
Most of the marketers are unaware of what turns the grey market off, and what results in taking any action, and this incognizance is the difference that exists between considerable growth of the business and the loss of a substantial portion of the market share.
The need of the hour is the right kind of advertising. Millennium, a market research agency conducted a study in 2008 that revealed that almost 55% of the grey market feels that most of the advertisings treat them in a very denigrating manner and this gives them a sense of being belittled.
Marketers essentially have a different and wrong notion about this segment of the population. Most marketers and advertisers feel that advertising would not really work for the +50s as they are something different. Essentially, the actual problem with marketers is the basic understanding of the term ‘senior.’
The customers of the grey market can be a highly valuable source for marketers and businesses because, they are already aware of business and the various products and services. It is important the marketers and advertisers do not stereotype them, and start focusing their advertising campaigns on this particular segment of the market.
As it has always been the most important mantra of marketing, even in the case of marketing to the over-50s, the principle should be “put yourself in the customer’s shoes.” While targeting the grey market, it is more about designing and customizing the products and services to meet the specific needs of the market segment.
It is highly important that companies or advertisers or marketers essentially understand the target audience properly. In case of the over-50s, irrespective of the product or service, people will not like to be called as ‘old,’ and thus it is not recommended that products or services are signposted in this manner.
Marketers first need to understand the motives behind that particular segment of population from having stopped their purchases. This would help them devise better strategies to appeal to that particular market.
Another thing that marketers or advertisers could possibly do is to clearly define the target population with increased precision rather than simply terming them as "older people". Designing and customizing the product or service to specifically suit this segment of population and ensuring that the products and services are based on a specific and precise need would be a great strategy to appeal and attract the grey market.
While the grey market is just a small segment of the total population, there is a strong likelihood that narrowing the target even further will make marketing campaign increasingly cost-effective, for instance, campaigns advertising health insurance policies that are aimed at the over-50 population.
In the case of the health insurance policies for the grey market, it would be more sensible for marketers to target smaller segments of the grey market and being more precise, for instance, retired couples having high levels of disposable income, than to targeting the product to all senior citizens of the country.
Target market segments that are narrowed down would allow marketers to choose the appropriate media channel, for instance, a specific radio station, a specific program on the television or a magazine category, in order to reach the subgroup without much hassle and nail it down successfully.
After successfully identifying and narrowing down the grey market segment that gives the maximum opportunity for the marketers, they would eventually design campaigns that cater to the needs of the chosen target market segment.
For instance, people above the age of 55 or 60 are most unlikely to be having dependents or having a mortgage to be paid every month. This would certainly translate to the fact that this particular target market segment would have lower expenses when compared to the younger demographics. This would indicated to the fact that aspects like rest and relaxation are greater priorities for the grey market segment than they are for the families with younger people and with no senior citizens. This is an insight marketers can exploit to develop a captivating marketing campaign.
In conclusion, from the various statistics and elements that have been presented above, the opportunity for marketers to build extremely strong relationships with audience of the grey market is apparently huge . Advertisers or marketers that appreciate the extent to which this segment of the target market is nuanced and accordingly respond to their practical, serviceable, and emotional needs of the grey market audience by generating empathy that shares the values and beliefs of this segment will see massive potential for growth for the products or services.
There is a massive potential for growth for all the marketers or the companies that move at a rather fast pace, commiserate and involves with this particular target market segment – the grey market or the over-50s. This is the age when people of that age are liberated from their obligations for the first time in life, and thus looking to diver their attention toward new pastimes and new means of recreation. This is exactly the reason why they are referred to as ‘The Unstoppables’. And this becomes all the more reason for marketers and brands to target this segment of the market and give heed to their specific needs. Ultimately, it is certainly a win-win situation, and more importantly, this population is not the one that marketers can ignore entirely and anything as such would harm them for sure.
Works Cited
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Tooker, Richard N. "Caputring the Exploding Senior Market: 25 Rules for Targeting Seniors." White Paper. 2011.
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