Study Probes Generation Gap
Edited by Erin E. Clack
May 1, 2004
For decades, most product marketers and advertisers have relied exclusively upon classic demographic factors such as age, gender, ethnicity, income and education level for guidance in developing products and marketing messages, overlooking the profound impact of generational values. This is a serious oversight, considering America is more generationally and demographically diverse today than at any other time in its long history.
There are currently five living generations (The G.I. Generation, The Silents, Baby Boomers, Generation X and The Millennials), four of which are active within the workplace today. And, each group is influenced considerably by the core values, attitudes and deep-rooted principles that mold its demographic 'type class.' A clear understanding of the motivational drivers of each of these groups can supply marketers and advertisers with essential clues and insight into the consumer mindset and behavior of their target audience.
"There is not a company or organization in America that shouldn't know and practice generational strategy. It is absolutely critical," affirms Chuck Underwood, principal & founder of The Generational Imperative, Inc., a research-driven generational consultancy headquartered in Cincinnati, OH. "This whole concept is still right under the radar, but within a year to two years from now, that will all change. It's emerging that rapidly." Generational strategy bears particular significance right now for marketers of children's products, as there is a challenging shift underway in that they are no longer targeting the prototypical, one-dimensional Baby Boomer parent, but rather now the complex, multi-dimensional Generation Xer, who is new to parenthood.
Boston, MA-based Reach Advisors, a marketing strategy and research firm, recently conducted a survey of over 3,000 parents across the country (titled Generation X Parents: From Grunge to Grown Up), in an effort to pinpoint the major differences between Baby Boom parents and their Generation X successors. "We saw that many of our clients that serve families have really started to see a shift in their customer base, but they couldn't quite put their finger on what it was. We realized that a lot of it had to do with a major generational shift taking place, and therefore decided to take a closer look," explains James Chung, principal. The study's findings were significant, and in many cases, surprising.
Not only are today's parents vastly different than their predecessors, but so too are today's children. Growing up in a time of profound political, global, social and technological vicissitude, the kids of the Millennial generation are consumers of an entirely different breed. Here, Underwood and Chung outline the key differences between Baby Boomers and Generation Xers and Xers and Millennials, pointing out the particular implications these differences bear for product marketers:
Baby Boomers vs. Generation X
The parents of the Baby Boom generation are dramatically different from those of Generation X, despite the widespread assumption among marketers that "Baby Boomers represented a new path that all subsequent generations would follow," Underwood says. Thus, marketers still attempting to target parents with one-dimensional portrayals from the past are likely to miss the mark. Perhaps one of the most significant differences between Baby Boomers - born between 1946-1964 - and Generation Xers -born between 1965-1981- is that Xers are much more pessimistic when it comes to their financial situations - a fact not all that surprising, since their generation has been hit hardest by the current recession. They are currently living in an environment in which there is little to no wage growth, and they are much deeper in debt than their predecessors.
"Xers harbor a lot of uncertainty about their ability to generate income in the future," explains Chung. In preparation for this uncertain financial future, he says Generation Xers appear to be planning ahead - investing in 401k plans, stock holdings and savings. And, with the focus on saving, they are pulling back significantly on their spending across the board.
Despite not feeling the same level of financial security as the generation before them, Xers are relatively comfortable with this, "since very few in this generation have ever tasted wealth," Chung explains. And, they talk about their wealth and purchases differently now. An interesting dynamic has emerged, he says, in that "Xers are no longer aggressively trying to signal wealth through their purchases to create bragging points like Boomers did, but instead are sharing how much they saved to create bragging points."
As shoppers, Xers have also demonstrated a greater willingness to crisscross retail channels when shopping for their families, frequenting high-, mid- and lower-end stores alike. Chung says value-focused stores like Target, in particular, are really getting it right when it comes to catering to the Generation X parent. "Target has ridden a great wave, by creating an environment where it's acceptable to shop at low prices," he says. "Parents can buy high quality products at affordable prices without having to feel embarrassed about it."
With attitude and action, Xers are showing that their families are their topmost priority. Rather than try to fit family into their work life, Chung says, Generation X parents are trying to fit work into their family life. "A significant number of Xer parents are making important career decisions in favor of family," affirms Underwood. And, in another interesting trend, fathers today are putting a stronger focus on their families and are playing a much more active role in the purchases for their children. In fact, the term "NASCAR dad" has emerged as the modern equivalent to yesterday's "soccer mom."
Copyright (C) Children's Business, Fairchild Publications, 2004.
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