Who are your consumers? What do they care about? Where do they come from?
Among the many questions that business owners need to know the answer to, these are three that you should ask yourself – and be equipped to answer – when approaching the development of your marketing approach.
This is because, although customers are typically diverse in personality, preference and purchasing power, there is one factor that can broadly define them: their age. Consumer groups may readily be identified by and segmented into the generations to which they belong. Furthermore, regardless of individuality and predilection, members of each generational category share certain characteristics that entrepreneurs can evaluate and understand, to better market to them. This is called generational marketing.
What is Generational Marketing?
This form of targeted, tailored marketing moves away from the generic mass-advertising and promotional practices that previously prevailed in consumer markets. A generational approach utilises customised marketing messaging, vocabulary, imagery, delivery and rewards to impact the response of a smaller, well-defined portion of a company's audience.
To do this, though, business owners must first study and understand the various age groups. Equipped with this information, they should then identify which of these categories their customers belong to, as well as which of these could potentially become their new consumers.
Understanding customers and bridging the generational gap is of uttermost importance in this venture. Entrepreneurs should learn about the experiences, priorities, influences, sources of motivation, likes and dislikes of particular buyers based on their age, as this will affect the products and services that they are interested in, the frequency of their consumption, and their ability and willingness to spend.
In addition to securing higher engagement with marketing campaigns and positively impacting sales, adopting generational marketing represents a commitment undertaken by a company to grow closer to its customer base, and invest in what they care about. Fostering such a customer-centric approach will impact the profitability and longevity of a business, and heavily influence consumer loyalty and community impact.
Though many subcategories may be identified, there are four prominent generational groups to consider:
Born between 1946 and 1964
Typically defined as the over 50s, 'baby boomers' (or just 'boomers') are those born between 1946 and 1964. This category constitutes a significant portion of the international consumer population – and one that has considerable spending power – making it an important group to consider in the construction of targeted marketing strategies.
Boomers typically respond well to traditional values that reflect the period during which they were raised. As a result, family is a significant motivation for them, and they can express nostalgia for happy times past. They are goal-centric with a famed work ethic, and respond well to these values being represented in the marketing campaigns targeted to them.
As boomers remain interested in traditional information consumption, they are easy to target using direct marketing delivery. They watch TV, listen to the radio, read both newspapers and magazines, and do not possess the advertising fatigue shared by later generations.
Born between 1965 and 1980
Immediately following the baby boomers, 'Generation X' (or 'Gen X') was born into the revolution of expression and freedom that heavily characterised the 1960s, 70s and 80s. Gen X, therefore, grew to become independent and entrepreneurial off of the back of the endless opportunities that were created by breaking down the preexisting social, gender and ethnic boundaries that had been in place before.
Better educated than their boomer predecessors, Gen X value a balanced lifestyle far more than previous generations. They typically seek to invest their disposable income into developing their knowledge and careers, as well as their personal interests and hobbies.
Nostalgia remains popular with this group, as 'cult classics' and their cultural impact rose during their era, something which can be leveraged by businesses looking to target these 40-50 year-olds.
Their information consumption is more mixed than other generations, with an equal preference for written and online media, and openness to digital transformation.
Born between 1981 and 2000
'Generation Y', or 'millennials', now in their early twenties to late thirties, have experienced first-hand the rise of innovative technology with the power to transform. Considered to be digital natives, they are open to change, excited by innovation, and motivated by sharing experiences and information online through social media. Equality and morality are meaningful to this generational group as are freedom of speech and social empowerment.
This generation has led disruption in traditional markets and indeed fostered the creation of new consumer sub-markets due to their enormous appetite for new digital, integrated services.
Millennials tend to have a low appetite for standard marketing and advertising content, due to the oversaturation of promoted online content in recent years. This has culminated in Gen Y paying a premium for media services that eliminate advertising content from interrupting their movies, TV shows or music-streaming services. This consumer group is, instead, won over by attention to detail regarding corporate values, and businesses' positive impact on the communities around them.
Born after 2001
The final group in this list, 'Generation Z' is generally defined as the under 20s. Sharing several core values with millennials, Gen Z buyers also have an affinity for technology, show a significant preference for anything digital, and are invested in social progression and morality.
They are, however, unique in their great interest in environmental issues, renewable energy, biodynamic agriculture, alternative nutrition and fitness. This has paved the way for further business innovation, as new markets continue to arise to fulfil the consumer appetite for products and services that cater to these elements.
Gen Z boast an almost exclusive digital media consumption, and share the advertising fatigue of their millennial predecessors. Their attention can, therefore, be more challenging to capture. They are, however, the future of the consumer industry, being the newest entry into the market with a modest but growing disposable income. This makes targeting them worth the added consideration and investment required.
Why Should Business Owners Care?
A competitive edge is paramount to the long-term survival of today's businesses. As digital marketing techniques and customer data utilisation become more advanced and intertwined, your company stands to lose significant ground to your competitors if you do not adopt targeted strategies that capture and retain specific consumers' attention. The fall of prominent corporations such as Toys R Us, Blackberry and Kodak provide clear examples of this and should serve as a warning of the danger of complacency in this area.
Further to impacting short-term sales, fostering a wholly consumer-first approach is an excellent way for your business to prove that it deserves the loyalty of customers. This can positively influence the continued success of your company, and ensure progression in the growing market alongside competitors, rather than beneath them.
Business owners should carefully consider their current marketing strategies, and make room for developments in their audience targeting with an aim to boosting results. Adopting generational marketing is a great way to accomplish this. By segmenting consumers into varying age groups, entrepreneurs can better address their individual interests, wants and needs, and ultimately secure the future of their businesses, with the support of a core loyal, customer base.
What are your thoughts on generational marketing? Let us know in the comment section below.