Target
Marketing
Dividing the total market into different
segments based on customer
characteristics and developing products
to meet the needs of those specific
segments
All people who make purchases for personal use
Current Population:
Population Clocks
U.S. 308,603,348
World 6,761,430,702
14:44 UTC Feb 2, 2010
Estimated Population Year 2030:
364 MILLION
http://www.census.gov/main/www/popclock.html
One birth every................................................ 7 seconds
One death every............................................. 12 seconds
One international migrant (net) every............ 37 seconds
Net gain of one person every......................... 14 seconds
Largest American increase:
1990 – 2000 with a 13.2% increase!
Where is the Growth?
West – 19.7% (Nevada – 66.3%!)
South – 17.3%
Midwest – 7.9% (Illinois – 8.6%)
Northeast – 5.5%
Demographics
Statistics to describe population
– measurable observable aspects
Geographics
Where people live
Geodemography – “Birds of a feather flock together!”
Psychographics
How people live
AIO / VALS
http://www.sric-bi.com/VALS/presurvey.shtml
Expectations of the class –
Dazzle me with your knowledge of
Demographics,
Geographics
Psychographics
AGE
Generation: when you were born
Cohort: when you came of age**
**much more important because it defines the
group: music, politics, war, culture
High Schoolers – What defines you?
AGE
Whoopies
“Well-heeled older persons”
65 + Market
35 million – 12% increase since 1990
The MATURE consumer
AGE
They are at home enjoying leisure time,
continued good health and are MOBILE!
What do we sell to them?
How do we sell to them?
•Easy-open packages
Music
•Larger print
Sayings
•Cosmetics
Stars
•Vacations!
Culture
Do Not Treat Them as OLD!
AGE
Whoopies
Ages 65-74
“Young Elderly”
Financially secure
Active & Healthy
Targets for leisure market
AGE
1990 – 4%
2000 – 12.4%
In 2000, 5574
celebrated 65th
birthday DAILY
Companies prepared them for retirement!
Travel Market: cruises, elderhostels, trips
Education: computers, hobbies, students!
Took care of themselves
Retirement communities
NOT nursing homes
AGE
Whoopies
Ages 75 +
Primarily Women
Poor Health
Less Mobility (Disability?)
Targets for nursing homes and
services for the elderly (health)
AGE
12% increase since 1990
Men are dying off
Will double by 2030
Less active, rely on others
30% not in institution live alone
This Whoopie Market is a group of Haves and Have Nots
Retirement, Medical Expenses, FIXED INCOME
What do we sell them?
Easy open
Small servings
Medical Equipment
Cosmetics
Comfortable clothing, shoes
AGE
Baby Boomers
Born 1946-1964
1997 -- 78 million
27.5% of population
Spend $2.1 trillion annually
Holds 75% of U.S. financial assets
By 2029 those 65+ will control over 40% of
U.S. disposable income!
AGE
Don’t trust anyone over 30!
Used to being the focus
Now at Peak Income
Getting older, but NOT getting old!
TV – Nip/Tuck, Housewives
Magazines – Health, Prevention, Cooking Light, Parenting
Use their music, attitudes, stars, culture when promoting
By 2011 – decline rapidly as a result of deaths
Hottest New Car Segment?
Boomer women in their 50s – REWARD CAR!
The mid-sized sporty
Up 277%
since 2000
Don’t forget the manwagon
Power, suspension, race car seats
and
fits the stroller!
AGE
Generation X
Born 1965-1976
“Baby Bust Generation”
birth dearth
45 Million
AGE
Generation X
Latchkey Generation
Felt effects of 1990 Recession
High levels of education (47% higher ed)
Fashionable, Irreverent, Conservative
AGE
Represent $1.4 trillion
in annual purchasing
power
By 2010 – overtake
boomers as primary
market for almost every
product category
AGE
How to sell to Generation X
Better educated, downwardly mobile
More family time, less contentment
It’s all about value
The “soccer mom” is history
Dads do more at home
AGE
Generation Y
The Millenials
Born 1977 - 1994
Baby Boomers having Babies
76 Million
Parents at peak earning potential
Diverse population
“Luxuries” are now “Needs”
AGE
Spending up to $159 billion
Influence another $30 billion in family
spending!
Tech Savvy = Impatient, Now-Oriented
How do we sell to Gen Y?
AGE
Children
Born 1995 to present
Despite economic downturn,
parents do not want to let
their children “suffer”
AGE
36 Million kids age 3 – 11
Have $18 billion in disposable income!
Influence additional $115 billion
Strong Influencers
•Food
•Entertainment
•Cars
•Vacations
•clothes
Increasing Diversity
More
“salad bowl”
than
“melting pot”
Increasing Diversity
White – 67%
Hispanic – 14.4%
African American – 13.4%
Asian American – 4%
American Indian, Eskimo,
Aleut – 1%
12% were born in
another country
Increasing Diversity
Underserved Market!
60 Million in U.S.
$220 billion in annual
spending power
Increase as Baby Boomers age
And impact of war
INCOME
Disposable Income
Gross Pay – Taxes = Net Pay
Rent, Utilities, Transportation
Food, Clothing, School Supplies
Medicine, Personal Care
Marketers of Necessities
INCOME
Discretionary Income
Net pay – basic expenses
Travel, Entertainment, Upgrades
INCOME
VALUE MARKETING
Wild spending of the 1990s has been dashed
by the recession of 2000
Distribution is still skewed
Top 1% of U.S. families control 33% of
wealth
Bottom 90% control 30% of wealth
INCOME
Upper Class – luxury goods, not impacted by recent economy
Middle Class – careful with spending but not doing without
Working Class – stick with basics, hard to save
Under Class – count pennies to make even basic purchases