It’s obvious why the “ever-elusive” millennials are the apple of every marketing team’s eye, as the population is soon to control 75% of the workforce. Millennials are demanding of the companies and brands with which they do business, they’re technologically advanced as it’s been ingrained into their habits from a young age, and they’re the most educated generation living now. They’re an attractive population, especially for credit unions and financial institutions who are seeking to lock in lifetime members from an early age. They are also easier to reach for less expense because 86% of this generation uses social media and it directly influences their buying habits.
Again, it’s easy to see why most financial institutions are focusing on the millennials, but I’m here to say that it’s time for credit unions to turn their attention back to the baby boomers. Here are nine reasons that financial institutions should turn their marketing sites to the baby boomer generation instead of the millennials:
- Let’s look at the sheer volume of people needing similar information simultaneously. Half of the entire US population is age 50 and over currently. 10,000 people are aging into government systems like Medicare and Social Security every day. The biggest year of the baby boomer wave won’t even hit until 2022 (those born in 1957) and the numbers will increase until then. This population of people is huge and looking for retirement information from trusted sources constantly. Why should they look any further than your credit union?
- People are living longer and have more time to accumulate wealth and, of course, spend it. The average male life expectancy in the United States is about 77 years old and for females about 81 years old. The average retiree’s biggest fear is outliving their money, yet they have three times the wealth of their kids and grandkids and are choosing to work longer. They also outspend every other generation, with a whopping $400 billion spent on goods and services each year. The predicted longevity of this generation gives a brand enough time to foster a lifelong relationship, even if it happens later in the member’s life. This time of a person’s life is also when they make critical decisions regarding retirement, and they spend more money with newfound extra time.
- Did we mention they control a lot of wealth? Baby boomers have more disposable income, more money in savings and loans, and they outspend every other generation. We’ve all heard the expression “show me the money,” and my response to that would be to point to the baby boomers. This generation makes up about 26% of the country’s population, yet they control 47% of the income. The group also owns 80% of all money in loans and savings accounts. The average baby boomer has about $24,000 a year in disposable income, and they have three times the net worth than that of their kids and grandkids. If you’re looking for members with money to spend, then look no further than the boomers.
- Boomer spending is already the highest among the generations and will continue to increase over the next two decades. Researchers are estimating that within twenty years baby boomer spending will increase by almost 60%, and in that same time frame, millennial spending is only increasing by 25%. The baby boomer wealth is vast and growing exponentially.
- Boomers are set to accrue even more money soon. This group is predicted to inherit over $15 trillion from their “silent” parents and grandparents. As the traditionalists (otherwise known as the silent generation) pass away and leave their legacies, many baby boomers will inherit significant assets. It’s estimated that another $15 trillion (or more) in assets will be in the hands of the baby boomer generation. Another amazing statistic- only 52% of boomers plan to leave inheritances for their children. The rest plan to spend it before they die! In fact, luxury travel is one of the most significant spends of the boomer generation.
- Everybody else is targeting millennials – but you were born to stand out! Only 5-10% of ALL existing marketing is directed at baby boomers. If you’re like me, then you would prefer to take the road less traveled. It may be against what competitors are doing but in a lot of cases that is a great thing. Going against the grain, especially when the numbers make sense, is a delightful walk on the wild side. Those who find and influence the baby boomers with their marketing will earn the more profitable members, and meanwhile, enjoy a less saturated target market for prospecting.
- You can access the millennials VIA the baby boomers. Most baby boomers influence their loved ones, especially kids and grandkids, which includes those mystifying millennials. Baby boomers have close relationships with their children and grandchildren (for the most part) and are influential in their brand and product choices. The millennials listen to their relatives, in fact, with 63% of them saying they use all or many of the same brands as their parents and grandparents. Moreover, 38% of millennials are willing to change brands because of a recommendation from a relative. If the baby boomers are directly influencing the generation that most CUs are targeting, then it seems a natural move to attract and delight that group as well.
- Baby boomers seek in-person engagement and are a highly attentive audience for seminars and workshops with topics they care about. Baby boomers tend to desire human interaction and connection when making a purchase or gathering research to make a purchase, much more than the millennial generation. Boomers care about important issues and take opportunities to learn and understand the retirement landscape they’re entering. Putting the human interaction together with a learning and social occasion is a match made in heaven! If you’ve ever struggled with attendance at your events, aim for the boomers to be your audience for better results and provide them topics relevant to their lives.
- Baby boomers are more loyal to brands than millennials, which means once you have them you are likely to keep them. While millennials are undoubtedly capable of brand loyalty, they make brands work a lot harder to keep them. They have higher expectations when it comes to customer service, probably due in part to the fact that they’ve always had options at their fingertips via their mobile devices. Not only that, but they are known to “jump ship” from brands for many different reasons. In fact, 80% of millennials would switch a brand simply to save money. Boomers are more loyal and additionally more likely to refer when they’re satisfied. When a member is genuinely loyal, they will buy about 66% more from you than your non-loyal members throughout the membership. It pays to have loyal members (pun definitely intended).
So, there you have it. Nine reasons why I believe that credit unions need to take a walk on the wild side and change up their target market. Take it from me- I’m a millennial who markets to baby boomers for a living. Millennials are an obvious market to choose because of our near domination in the workforce and our demanding consumer habits, but we waiver and easily “brand jump” when we can save a buck or are unhappy with customer service. Growing up in a world where we have “option overload,” millennials are the riskier group to recruit. I hate to admit it, but as a millennial, I absolutely believe that.
Baby boomers have massive wealth and not near as much debt as millennials, they’re more loyal when given opportunities to get to know a brand, they’re more likely to refer when their delighted by a product, service, or brand, and to top it all off, very few brands out there are marketing to them. Baby boomers are where it’s at.
We’ll be breaking down how to market to baby boomers with some tips and tricks for CUs in future posts. Follow our blog and comment with more topics you’d like to see!
Stay classy, CU world!
Cortney Ventrone
Sources: 1) “The Generational Shift in Brand Loyalty” by Guest Contributor, SmallBizClub. www.smallbizclub.com., 2) “How Brand Loyalty Differs Among the Generations” by Matt Graywood, Modern Restaurant Management. www.modernrestaurantmanagement.com., 3) “30 Customer Loyalty Stats You Need to Know” by Sara Spaventa, thanx.com. 4) “31 Stunning Baby Boomer Population Statistics” by Brandon Gaille, www.brandongaille.com.