Old People Are the Future

Old people are the future

These days older people have more disposable income than younger people. Youngsters have to challenge with financial issues, thanks to house-price-inflation and costs for their education, furthermore the lingering effects of the financial crisis negatively influence the likelihood for employment. Whereas, in general, the elderly have already paid for their houses and do not have educational costs, causing a better financial position including fewer debts. Whether firms should target the less-moneyed younger generation or the rich older generation depends on the products they sell. In this essay the advantages of targeting these two groups will be compared and contrasted.

The group of older people is growing fast and will be 40% bigger by 2030. Moreover, the life expectancy of humans is longer than ever before. These Baby Boomers will control 70% of the disposable income in the US, so the number of years they spend consuming products and services is extended, making them more interesting for firms. Furthermore, thanks to their financial position, they have more money to spend. In contrast to the elderly, younger generations have less disposable income to consume products and services, being less attractive for firms. Based on demographic and financial aspects companies should choose to target older people.

Older generations have a tendency to have more brand loyalty than youngsters which means that when they become a consumer of a product they keep buying it for a longer period. However, it depends on the type of product. In addition, older people are more resistant to brand switching, so it is harder for competing companies to lure them away. In contrast, younger people are less loyal, so they easily switch brands, making it difficult for companies to build up a long-term relationship with their customers. This is another reason for target older generations.

In contrast to younger people, older people are difficult to reach for marketing campaigns of companies, because companies approach them in the wrong way. Youngsters often are very enthusiastic for new technologies and innovative products. Plus they are easy to reach, for instance using social media.

To sum up, companies, who successfully reach the loyal and wealthy older generations as their customers, will perform well. Nevertheless, these companies are dependent on the type of product they offer. Companies who develop innovative products would do better to target younger people because these customers are more likely to buy products with new technologies. For the future it is important to develop marketing methods to reach the older people. In addition, every company has to evaluate which generation they want to target based on the products they sell and the strategy they have.