At 80 million strong, baby boomers are one of the largest demographics in the US, spending more than $160 billion on packaged goods last year alone. Since this group of consumers is just entering their golden years, their impact on the CPG, retail and healthcare industries will be felt for years to come.
Baby boomers are a diverse group. Its members were around during Harry Truman’s Administration all the way to the Gulf of Tonkin incident.
In its latest SymphonyIRI Times & Trends Report, “Baby Boomers: Riding the Wave of Diversity,” the Chicago-based market research company takes a closer look at this complex market segment and helps CPG marketers understand the current and evolving spending habits of the different boomer segments across categories and channels.
For starters, these Americans—born between 1946 and 1964—are a very large consumer group with an age range that spans nearly 20 years. For this research, SymphonyIRI breaks the group into two segments: older boomers (born 1946-1955) and younger boomers (born 1956-1964) to capture their distinct cultural experiences, lifestyles and attitudes.
While the grocery channel holds similar share of spending across older consumer segments, drug and dollar channels demonstrate increasing relevance as consumers age. Still, drug channel retailers hold lower than average share among younger boomers, likely due to particularly low share across sizeable categories, including soap, toothpaste, vitamins and internal analgesics within the younger boomer cohort. In contrast, dollar channel spending among younger boomers is above average across each of these categories.
Grocery share of CPG sales is 48% and 47% among younger boomers and older boomers, respectively. While club channel share is lower, at just over 10%, the channel gained 0.3 share points among shoppers as a whole. Across younger and older boomers, share gains were slightly higher, at 0.5 and 0.6 share points, respectively. Health-related programs, such as Costco’s prescription assistance and health-screening services, are a factor in this success.
Department-level spending trends reveal important points of divergence among this diverse group. For instance, boomers spend 59% of their CPG dollars on center store categories versus 56.5% for the average consumer. Above average spending on carbonated beverages, dog food, and chocolate candy contribute to this trend.
In a majority of CPG departments, spending mix changes slightly as consumers age. For example, spending in beauty/personal care and healthcare also changes, with beauty/personal care spending sliding and healthcare spending increasing among older cohorts. Above average healthcare spending by boomers translates to the following significant opportunities for marketers of healthcare and CPG products that help support health and wellness, according to SymphonyIRI.
And when it comes to skin care, anti-aging facial products are very popular among boomers and spending on these products jumps significantly between younger and older boomers. Overall, this category has struggled due to the economy, and consumers cutting back on such products, said SymponyIRI. However, as the economy gains momentum and new ingredients and products come to market, skin care marketers have a significant opportunity to renew momentum in this area and to convert facial anti-aging category buyers to the body anti-aging market with messages around value and effectiveness.
More info: www.SymphonyIRI.com