Money, time and changing consumer demographics
Trade-offs between time and money change as consumers age, but tomorrow's retirees won't spend like those of the past.
Money and time are the two most important factors driving consumer behavior in the Western world, according to consumer trend expert Herman Konings, Ph.D., who is the founder of the Belgian trends and future research agency Pocket Marketing nXt. Don't think of consumers in terms of their ages, Konings said. Instead, think of them in terms of generations. People were formed not by their parents but by their generation. "We all are children of a generation more than we are children of our parents," he asserted.
The Baby Boomers, born between 1946 and 1964, were defined as being monetarily affluent, but time-challenged, as many of them would have to continue working longer than previous generations.
After the boom
Generation X is the popular name given to people born between 1965 and 1980. These people, who are now between 28 and 43 years old, he described as being money and time challenged. People born before 1940 and who are now between 68 and 80-plus years old were classified as Seniors, whom he considers to be time-affluent but, although they have money, they don't want to spend it. They are thrifty and want to leave their money to the next generation.
A new type of retiree
Konings identified a subset of the Baby Boomers who have already retired "early" as Mediors. They are affluent, have abundant time and money and are likely to spend unapologetically. Marketing to this group means that, at the same time, you are also reaching a younger generation who seemed to be more easily influenced by their parents.
Mediors have some 45 hours a week extra free time as compared to when they were working. Konings said that in the next seven to eight years in the Western world these "pop culture" Mediors will be the most important group in retirement.
Today, three-quarters of all people retired fall into the Seniors category as they were born before the second world war. In the Western world, by 2015, three-quarters of all retired persons will have been born during or after that war. While the previous generation did not like to spend their savings, the Mediors group has been defined as the SKI generation, which means that they were likely to "spend their kids inheritance." While the Seniors had experienced scarcity and were careful with their spending, the Mediors and the following generations, had never experienced financial hardship.
Enjoying their golden years
So the Mediors have a very different attitude to spending money. Starting today they will become a dominant group who, during retirement, will spend money on vacations and also on cooking. Of particular note here is that the male Medior likes to cook. The Mediors will go on vacation three times as often as the Seniors. They will refurbish their houses every five years instead of every 10. Life expectancy has increased by two to three months each year so the Mediors will die seven years older than the Seniors. This means that, more than ever, the Medior generation will be concerned about healthcare, particularly when they are 80 or 90 years old. This will result in less money being left to the next generation.
The Gen X group has less money and time to spend. They are particularly concerned about food and are telling their parents that they too should be ethically concerned about food and look at labels.
The Gen X people will buy more ready-to-eat meals, because they don't have the time to cook. Time is a more valuable commodity today more than it was 20 years ago.
While Seniors are concerned about healthcare, those in the Mediors group are more concerned about wealth care, both financially and mentally. They are more interested in culture, information, and particularly cooking. They, like those in the Senior group, spend more time at home. So, cooking at home becomes more important particularly since they are more eager to invite friends to their homes. Even those in the Gen X category are more likely to stay at home because of the high costs of going out.
Everyone is a chef
The most important room in today's home is the kitchen and men have become its new users. The kitchen has now become socially open with friends coming directly into the room. Men tend to cook for guests but not for their own family. They also like to buy cookbooks.
Research in Belgium and the Netherlands has revealed that, for the Mediors, the bedroom is a beautifully designed room with a lot of high-tech equipment and is also a place to eat. So, Mediors will eat in their kitchens, dining rooms, and also in their media-rich bedrooms.
Konings said that in Europe more people are concerned about where their food was produced and try to purchase food produced within 100 miles of their homes. Ethical concerns have put emphasis on local production. The middle class likes to have locally grown produce and is demanding that it be made in an ecologically sensitive way.