Baby Boomers Are Getting Lost in the Shuffle With Marketing's Relentless Focus on Millennials

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Baby Boomers Are Getting Lost in the Shuffle With Marketing's Relentless Focus on Millennials

01/24/2017
ICLP, a global loyalty marketing agency, part of the Collinson Group, reveals that despite Baby Boomers (age 55+) often being the most affluent customers out of all the generations, as many as 93 percent aren't fully loyal to their favorite brands because they feel overlooked and not adequately rewarded.
ICLP, a global loyalty marketing agency, part of the Collinson Group, reveals that despite Baby Boomers (age 55+) often being the most affluent customers out of all the generations, as many as 93 percent aren't fully loyal to their favorite brands because they feel overlooked and not adequately rewarded.

As a result, brands are losing out on a major financial opportunity with this generation and increasing the likelihood that these customers will stray to competitors. In order to create valuable, enduring relationships with Boomers, it is imperative that retailers target online and mobile marketing efforts towards them and create tailored loyalty strategies that fit with this generation's needs and expectations.

ICLP and SSI surveyed 1,000 U.S. consumers, ranging from Millennials to Baby Boomers, to examine the psychological parallels between human and brand relationships. The poll compared consumers' experiences with friends and romantic partners to those they have with brand relationships, looking at seven core relationship criteria, including: recognition, rewards, reciprocity, reliability, respect, trust and communication. The types of relationships analyzed range from empty (the least desirable), liking, casual, romantic, companionate to devoted (the most desirable).

By partnering with Professor Ron Rogge from the University of Rochester – a global authority on relationship dynamics –  ICLP created a customer-brand relationship model based on Sternberg's Triangular Theory of Love[i], which focuses on three key components of a relationship; intimacy (willingness to share information with a retailer), passion (brand enthusiasm) and commitment (loyalty). The study found that at their most loyal, consumers fall into the devoted group and are enthusiastic, passionate and committed to a retailer, as well as the least likely to stray to competitors.

Why Baby Boomers aren't devoted customers and the consequences of this
Cyber Monday hit a record $3 billion in sales this year, marking a 16 percent jump from the previous year and highlighting the increasing importance that consumers of all ages are placing on the online and mobile shopping experience. However, beyond Cyber Monday, most retailers focus their year-round online and mobile marketing efforts on Millennials by appealing to their frugal, post-financial crisis mindset and multi-device-connected lifestyle.

However, brands are missing out on a key generation – Baby Boomers – as 84 percent have a smartphone that they use for various aspects of the shopping journey and 79 percent are willing to indulge on purchases for their family. This age group controls 70 percent of the US's disposable income, demonstrating how important it is that they are paid equal attention to beyond the in-store experience.

According to ICLP's research, retailers' lack of focus on Boomers is evident by the 93 percent who are not devoted to the brands they engage with the most, as in they don't feel a high level of passion, commitment or intimacy towards them, and are more likely to "cheat" with a competitor. They aren't devoted because they tend to feel undervalued and unrecognized by these brands. 88 percent report that they don't expect brands to spend the time to get to know them and understand what they want, and nearly three out of four (71 percent) report that their customer loyalty is not adequately rewarded.

The predominately negative way that Boomers perceive the customer-brand relationship is problematic because devotion is an extremely powerful business driver. Age aside, nearly all consumers who are devoted to their favorite retailers would also recommend the brand to others, indicating just how valuable devoted customers are compared to the other relationship categories analyzed. However, only one-third of Boomers would regularly recommend their top brands to others, demonstrating their overall lack of enthusiasm and commitment.

What retailers can do to increase customer devotion among Baby Boomers
According to the findings, the following best practices are key to driving customer loyalty among Baby Boomers and therefore, moving the needle towards that ideal devoted relationship:
  • Increase customized recognition: Just 12 percent of Boomers expect that brands will spend the time to get to know them and understand what they want. Additionally, less than 40 percent of Boomers who consider themselves "regular customers" feel appreciated by those brands. By brands tailoring efforts towards understanding what Boomers as a whole – and individually – want from the shopping experience, this generation will feel more valued and therefore, become more loyal customers.
  • Recommend more relevantly: As many as 80 percent of Boomers don't expect brands to make relevant recommendations for products and services that personally interest them. It's imperative that brands recommend based on individual purchase patterns to demonstrate that they're paying attention on a personal level and not generalizing an entire group of consumers.
  • Be reliable and responsive: Over 60 percent of Boomers want brands to acknowledge when things go wrong, apologize quickly and fix the problem quickly. Boomers value reliability and responsiveness, so in order to obtain and then maintain their loyalty, brands need to own up to mistakes and quickly rectify issues.
  • Treat them like an individual: Less than 40 percent of Boomers expect brands to make them feel valued, rather than just like any other customer. Again, individualizing is key for this generation. For Boomers, tailoring communications, recommendations and recognition according to their personal relationship with the brand will make them feel special and in turn, increase their loyalty.
  • Provide more personalized rewards: More than 3 out of 4 Boomers (77 percent) are not rewarded with offers that are specifically tailored to them. While rewards are typically more important for Millennials and Generation X, all generations are more likely to purchase if they're rewarded better. Implement a personalized rewards strategy that surprises and delights.
  • Send relevant and valuable communications: 75 percent don't expect brands to send them information and content that's tailored to their requirements and interests, with nearly the same amount claiming that brands don't keep them up-to-date with the latest trends. Find the right balance between contacting frequently (and relevantly) but not bombarding. Use Big Data insights to understand the ways that individual customers prefer to be contacted.
  • Maintain and even increase trust: More than half assume that they can trust the quality and reliability of retailers' products. The more trustworthy customers perceive products and services to be, the more devoted they'll become.
"Brands typically target their mobile and online marketing efforts at Millennials, regardless of what type of brand relationship they are in, because they are the largest and most tech-savvy generation. However, by doing so, they risk overlooking Baby Boomers, who are also highly influential and often more affluent shoppers," said Phil Seward, regional director, Americas at ICLP.

"However, Boomers are also shifting more of their shopping online, and they're using many of those same rewards apps. Our research highlights that Boomers feel undervalued and overlooked, so it's important that retailers give this extremely important customer base what they want and need – a personalized customer experience that is responsive and communicative," Seward continued. "The more retailers leverage data-driven insights to ensure their marketing strategy creates meaningful connections with Boomers, the more emotionally connected they will feel towards your brand, turning this valuable age group into repeat, loyal customers."

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