Penny-Pinchers? Hardly!ByRaymond D. Matkowsky
There has been a great deal of talk as to how senior citizens do not advance the U.S. economy. This is true. They do not. This is not the fault of senior consumers. It is the fault of marketers. They look for the 18 to 34 year olds and gear their marketing efforts to this demographic. This is a sure way to lose out on a great potential.
Seniors control most of the disposable income in the U.S. and probably much of the world
The U.S. economy has been very bad, especially to the 18 to 34 year olds. First of all, this group has had difficulty in finding enough entry jobs into the economy. They blame seniors for not leaving the jobs they are in, so everyone can move up. Seniors have their own difficulties, but unemployment is not one of them. The fifty to sixty five year olds have the lowest unemployment rate among all the classes.
Even those that are able to find a job, many 18 to 34 year olds are just starting a family and are heavily burdened by debt. Most of their income is going to necessities.
Many seniors no longer have a mortgage to restrict their disposable income. As a senior within this group, I can testify with certainty that this makes a very big difference. Seniors have the highest salaries. Seniors have spent the last thirty years accumulating the goods they need and want. They are the recipients of large inheritances. They are and will be the largest segment of the population for a long time.
How do seniors spend?
Seniors spend freely. They can. But, they do not spend with abandonment. They buy on value and with plenty of thought. Marketers must do two things to attract this group. The first is to show your product’s value and differentiate it from your competitors. If two products are perceived of equal value, then they will buy on price. If one product is perceived to be of greater value, they will gladly pay a higher price. The second is to presell your product and follow up without becoming an annoyance. Keep the name of your product in their minds. Remember, a buyer may not always be ready to buy when you are ready to sell!
How do you sell on value?
Every product is unique. Every product has a unique value. You just have to find and sell it.
I’ll give you an example. First of all, let me just say that is supposition from my own background that has never been tested. A couple of decades back, I worked for a small chemical manufacturer. One of the products manufactured was a defoamer. The majority of the customers that bought this product, used it at the 1.0% concentration level. I began to think that under certain conditions, they could use much less. At the time, there was no incentive to look at this possibility. There were several competitors in the field. Their products were also generally used at the 1.0% level.
Imagine now one manufacturer coming out and saying “You could use my product at the 0.75% level and get the same performance.” In many companies the decision makers are seniors that buy on value and would flock to him since he would show real value.
A simple A/B test maybe all that is needed to prove the case. A full blown analysis of variance may show even more value situations.
Whether you are in a B to C or a B to B industry, “Value” will be the key to successful marketing for a long time.
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