Fast Company

Where The Bucks Are

Youth-obsessed Madison Avenue is missing the biggest, richest market of the future. Boomer women have money to spend and make most purchasing decisions. Plus, they live 15 years longer than their husbands. So why aren't advertisers paying them any attention?

Kathy Ledesma doesn't own an iPod. Or an Xbox. Or a stretchy pair of sweats with juicy on the rear. She doesn't drink Bud Light. Or wear Nikes. Or paint her nails with Hard Candy's Peep Show pink. She bought her dining room table during the first Bush administration, and has used the same mayonnaise since 1971. She's a little confused about whether Nelly and Nelly Furtado are the same person.

From Madison Avenue's standpoint, the 52-year-old Encinitas, California, art-glass entrepreneur is a has-been. Washed up as a consumer. A marketer's black hole. Send a message out to her, common wisdom says, and you're throwing money at a lost cause--a person with calcified brand preferences; an already overstocked larder, wardrobe, and garage; and little interest in the kind of spending that makes marketers merry.

But a small avant-garde of trend-tracking marketers is now challenging that axiom. Dismiss Ledesma and her peers at your peril, they say. If you do, you're likely to miss the biggest, richest, most lucrative market of the future: boomer women.

Given marketers' obsession with youth--a fixation that began, not surprisingly, in the 1960s when the boomers themselves were adolescents--this may seem an odd cohort to target. But the numbers don't lie.

The 40-plus age group is now 45% bigger than the 18-to-39 group and will be 60% bigger by 2010. In 1989, adults 40 and older became the biggest adult segment for the first time in U.S. history, making them the new customer majority. The leading edge of the boomer cohort--which encompasses people born between 1946 and 1964--is 58 now, and if past experience is any indicator, the group that humorist Joe Queenan called "the most self-important generation in history" is likely to transform middle age and beyond, much as it did puberty, early adulthood, and thirtysomething.

More important, boomers have bucks. Lots of bucks. According to Mature Marketing & Research, a Boston-based firm, they control more than half of the nation's discretionary income and three-quarters of the country's financial wealth. And they're likely to get their hands on even more. Boomers' parents, the Silent Generation, are dying off, and inheritances will spell the largest intergenerational wealth transfer in history. Add it all up, and by 2010, spending by people 40 and older will be "a trillion dollars greater than spending by people between the ages of 18 and 34--$2.6 trillion versus $1.6 trillion," says David Wolfe, author of Ageless Marketing (Dearborn Trade Publishing, 2003).

And the folks wielding the turbocharged wallets are most often women. Consider Ledesma, who over the past year spent $10,000 on kilns, torches, and tools for her art-glass business, Bluesdawg Creations. She and her husband, Pablo, also bought a new refrigerator, a Ford SUV, and a dorm room's worth of furnishings for her college-age daughter, Jessica. They took trips to Las Vegas, Virginia, and Tucson, and sprang for tickets to Simon and Garfunkel and Lyle Lovett. "I make almost all the purchasing decisions in our house," Ledesma says. "I do the research, we discuss what I've found, and then Pablo says, 'Yeah, honey, whatever.' "

That's not atypical behavior in American households. Regardless of age, women in America disproportionately decide where a family's funds will be spent. According to Martha Barletta, author of Marketing to Women: How to Understand, Reach and Increase Your Share of the World's Largest Market Segment (Dearborn Trade Publishing, 2003), women control or influence 80% of all purchases of both consumer and business goods and services. They have sole or joint ownership of 87% of homes and buy 61% of major home-improvement products. They account for 66% of all home-computer purchases and 80% of all health-care services. They carry 76 million credit cards, 8 million more than men. And they start 70% of all new businesses. "In a nutshell," says Barletta , "women are the ones spending the money, and boomer women have more money to spend."

Not to be too ghoulish about this, but keep in mind, too, that women tend to outlive their husbands by about 15 years. According to Mark Alarik, president of Sales Overlays, a Chicago-based advertising and sales promotion firm, that means that "the combined wealth of both sides of the family is heading straight for baby boom women's wallets." Mabel, let's go shopping!

You would think that marketers would be on this group like ants at a picnic. You would be wrong.

"Every year, when we announce our year-end sales, analysts ask us, 'So, who's your new competition this year?' " says Charlie Kleman, CFO of Chico's, the hugely successful women's clothing store that sells to boomer women. "We always answer, 'Nobody.' I don't know why there aren't more stores like us out there. This woman is crying out for someone to sell her clothes that keep her in style and will fit her body the way she wants, and nobody's doing it."

Car manufacturers seem equally clueless. "Given that they buy or influence the purchase of 80% of all cars, you would think the entire automotive industry would be focused like a laser beam on women," says Barletta. "But it's not. Every single woman I know can tell you a horror story about having gone into a car dealership."

Tap into a midlife woman's renewed sense of self, and your cash registers are likely to start ringing.

Same thing with consumer electronics, an industry uniquely myopic when it comes to speaking to women. Elissa Geier, 43, a clinical psychologist, is still fuming about her experience buying a laptop at a CompUSA in Chicago. When she tried to ask questions about various models, the sales clerk, a guy in his mid-20s, cut her off: "This is all you need, doc," she remembers him saying dismissively. "I very rarely feel stupid and condescended to, but I found this quite disconcerting," she says. "I'm going to use this computer forever so I don't have to go through the experience of having to buy another."

While some of these issues are problems women of all ages face, in many cases boomer women face an even more insidious hurdle than their younger peers. "Ageism is our society's last acceptable area of bigotry," says Wolfe.

In marketing, at least, there are long-standing philosophical reasons for this bias. It has been a dearly held article of faith in the industry that if you hook a consumer when he or she is young, you'll have a customer for life. Axiomatically, then, mature consumers must be locked into brands they first met decades ago, even though recent research by RoperASW says that older consumers are as likely to switch brands as their children. Second, and more simply, most advertising copywriters are young and male. And let's face it: Demi Moore aside, to most young guys, the idea of a middle-aged woman is just, well, not sexy.

"Tell young men you're targeting your automotive ads to women over 45, and you're likely to get a response like, 'Okay, so we're marketing to middle-aged women, right? Got it. So we want to put a decrepit old crone in front of the car, and we're going to talk about safety, safety, safety,' " says Barletta, laughing. "Forget that the woman is saying, 'I want a car for me now that the kids are out of here!' "

That sentiment embodies the single most powerful approach to this market: Tap into a midlife woman's renewed sense of self, and your cash registers are likely to start ringing. These women are on the ascendancy in their lives, says Crawford Hollingworth, a director at London's trend-tracking firm Headlightvision, a leader in global research on the over-50 market. "I've seen a reawakening of a consciousness of what it means to be a woman, not in a sexual way, but in enjoying being a woman, and thinking about what they want to get out of their lives," he says. "There are a lot of things these women have put on hold, and now they suddenly have the freedom to do them without feeling guilty that they're not looking after their family or their husband." Marketers who can address those yearnings will find a receptive audience, he says.

Financial-services companies, in the business of following the money, picked up on this trend early. An ad for PaineWebber (now part of UBS AG), for example, featured a picture of two women: one clearly the mother, the other the daughter. The copy read, "You're psyched about the future. You're full of new ideas. You're looking to start a business. You're the one on the right." The one on the right was the older woman.

New Balance sneakers was also prescient in addressing this market. After watching sales to young consumers decline in the late 1980s, CEO Jim Davis turned his attention to the older customer. Having five shoe widths rather than three was a boon to older, flatter feet, but his true breakthrough was in product positioning. One ad several years ago featured a woman of uncertain age jogging down a lane. The text read, "One more woman chasing a sunset. One more woman going a little farther. One more woman simply feeling alive. One less woman relying on someone else." "That last line is right in tune with the soul of the midlife woman," says Wolfe. In an anemic market for athletic shoes, New Balance logged sales of $1.3 billion in 2002, double the $550 million it sold in 1997.

It was a breakthrough for older women when 58-year-old Diane Keaton bravely got naked.

Saga, a British-based services company designed for the over-50 crowd, recently tweaked its positioning to address the many consumers in this age bracket who prefer action-oriented travel over sedentary trips like cruises. "Saga originally was about being old," says Hollingworth. "Now it's about being older. It's a very subtle distinction, but psychologically huge. These people want to go to Machu Picchu and discover things, not just chill out."

Many other companies, though, are finding it's not so easy to hit the right note with this crowd--hip, but not too hip; respectful, but not stodgy; and, above all, aware that there's a difference between a 47-year-old and an 80-year-old. "To young product managers, everybody over 45 is lumped into a category called 'old,' " says Lori Bitter, partner at J. Walter Thompson's Mature Market Group. "They want to put swing music in the background of an ad targeted at 50-year-olds. We have to say, 'No, let's try Sting.' "

And even if they can manage to get the age thing right, Barletta says companies still tend to screw up in fairly predictable ways when they add women to the equation. Too often, their first impulse is to paint the brand pink, lavishing their ads with flowers and bows, or, conversely, pandering with images of women warriors and other cheesy cliches. In other cases, they use language intended to be empathetic that comes across instead as borderline offensive. "One bank took out an ad saying, 'We recognize women's special needs,' " says Barletta. "No offense, but doesn't that sound like the Special Olympics?"

But a breakthrough may be on the horizon. Last December, 58-year-old Diane Keaton, a leading-edge boomer, bravely got naked and ultimately broke Keanu Reeves's heart in the holiday hit Something's Gotta Give. Trust Annie Hall to prove that women at midlife still have mojo.

Hollingworth, 42, thinks the film may signal a watershed moment in the repositioning of middle age. "Isn't it becoming a little bit sexier to be older?" he says. Older people have more time, more money, and now--gadzooks!--apparently even sex. "At the moment, sexy is young because that's the only currency. So let's create a currency of being older that makes young people go, 'You lucky bastards!' And then we'll have done it." nFC

Sidebar: A three-point plan for marketing to boomer women

1. Put people first.

Shift the focus in ads from the product to the prospect. Women are biologically programmed to be more interested in people than men are, and boomer women are especially interested in family ties and community involvement.

2. Convey empathy, not rivalry.

Ads that talk about outranking others and defeating opponents are great for guys, rotten for women. Emphasize collegiality, closeness, helpfulness, and consensus--values that resonate particularly well with midlife women.

3. Portray them authentically.

The older woman is more assertive, confident, and global in her outlook than marketers have given her credit for. A bonus: These attributes also work for midlife men.

Fast Company senior writer Linda Tischler (ltischler@fastcompany.com) is a boomer woman who does her best to support the travel, restaurant, and shoe industries.

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