All the talk is of the Millennials and how they are the group that every company has to attract. Yes, it is fair to say, they are the future and that retailers’ longevity will be inextricably linked to doing business with them – now, or in the future at some point when they mature.
But by focusing so strongly on this demographic, companies are missing out on the massive opportunity presented by those rather older people at the other end of the age scale. Consultancy McKinsey reckons the Millennials are being given far too much attention.
Instead, it points to the statistic that as many as 46% of seniors have money left over at the end of the month for spending on luxuries versus a paltry 26% for younger people in the UK. This group is also growing at a fair clip, with forecasts suggesting the percentage of the population aged over 80 will move from 4% to 10% by 2050.
Whereas massive commitment and resources are directed at understanding the younger end of the market in order that their wallets and purses can be prised open and their contactless cards removed and then used with abandon. If they had any money that is!
In contrast, there is little knowledge of the realities of the older grouping. The fact is they are not all sat at home on their orthopedic chairs while enjoying their retirement. Many more seniors are working until much older than previous generations. For many this is a financial necessity but for others it is a lifestyle choice, which provides greater spending power.
The bottom line is that the scenario around them is changing and there is arguably insufficient intelligent targeting of this group with relevant advertising, promotions, and general engagement with them across channels.
While the Millennials suffer through a period of having limited resources it might be sensible for retailers to look to the older grouping to at least fill in some of the revenue gaps that are prevalent at the moment.
The most sensible strategy of course would be to find a way to focus on both the Millennials and the seniors, which is an approach that is being increasingly taken by the financial services industry. For many retailers balancing these two very different groupings might be a tough challenge but it could define the future winners.
Glynn Davis, editor, Retail Insider
K3 Retail deliver multi-channel solutions that enable retailers to create joined up shopping experiences for their customers whether they choose to buy on-line, direct, in-store or via mobile. It has over 20 years’ experience delivering award winning solutions, to more than 175 internationally recognised retail brands.