The “one size fits all” approach no more works. Businesses have discovered that marketing success now relies on narrowing their focus and efforts to their specific group of buyers. The most common differentiation is the types of generations, so it’s important to understand their spending behaviors above all, then address their particular needs and wants.
Age or generation demographics work on the concept of lifecycle in which wants and needs are believed to evolve with age or stages in life. For instance, baby boomers will most likely be indifferent about keeping up with new tech releases, just as Gen Zs would not be at all interested in grabs and safety bars installation.
Why Is It Crucial to Understand Each Generation Type?
Firstly, you get to understand their spending behaviors. Each generation surely has striking differences. Understanding their characteristics, you would know which channels they turn to and the marketing strategies they would most likely respond to. You can develop much better marketing techniques just by understanding each generation deeply.
Knowing the generation demographics also proves to be very crucial in making business plans. You will want to determine the target market of your services and products. Narrowing your target segmentation strategy to generation types can greatly help.
It also becomes easier to address consumers’ wants and needs when you know what clicks on every generation. You know which age group is likely to buy your products and services. You can readily predict who would be responsive and interested and those who wouldn’t.
In terms of building your company’s image, you can seamlessly finalize which marketing tools to use. Developing your company’s image and determining how you would present yourself online would aim to appeal to your customer base. For instance, social media wouldn’t be the best option when your customer base is baby boomers. You’ll find more Gen Zs and Millennials on social media than baby boomers. For the next part, let’s take a deeper look at each generation type and their spending behaviors.
The Four Main Generation Types and Their Spending Habits
Baby Boomers (born from 1946 to 1964; ages 55 to 73)
Baby boomers remain to be the largest generation. They tend to appreciate both the traditional and contemporary means of marketing. When it comes to online versus brick-and-mortar shopping, a huge portion of the baby boomer population will prefer the latter, given their high expectations of quality customer service. This population tends to view social media as simply for socialization, so in terms of marketing, they do better through text messaging or basic smartphone apps. They’re hardwired loyal to the brands they have been buying and using for all their lives. Since baby boomers have already accumulated savings, they might not be necessarily drawn to bargains, unlike Gen Zs and millennials.
Generation X (born in the early or mid-1960s to 1980s; ages 39 to 54)
Specialists usually forget this generation, what with the lack of research regarding their spending habits. However, Gen Xers cannot be ignored given their high purchasing power, although their generation tends to shop more conservatively than others. They are the people who research more about the products or services before spending their money and can be easily swayed to not buying when they hear bad feedback about them. They prefer extensively reading online reviews, so they can be very skeptical about marketing strategies.
The majority of Gen Xers are busy professionals, so they lack much time to explore their way in the digital media, although they’re already using Facebook. They use this platform to stay connected with their friends and get updated on the news. Like the baby boomers, convenience is key, so email marketing works best. Make sure to build their trust in your brand, as Gen Xers are heavily brand-loyal.
Millennials (born in the early 1980s to mid-1990s; ages 24-38)
Millennials are soon to be the largest generation among all and are nearing their prime spending years. As of the latest study about this generation’s spending, they’re projected to have spent $1.4 trillion in 2020. Millennials now make up a huge portion of the overall workforce. They are generally idealistic, eco-conscious, and conscience-led, so they are more likely to buy goods from companies that donate to charity. Nearly 85% of millennials claim it’s essential that they buy from companies that share the same values as they have.
They tend to favor both Facebook and Instagram and are hugely fond of Amazon. It’s wise to use paid social media promotions to reach your millennial customer base. Integrity and straightforwardness are a must.
Generation Z (born from 1995 to 2010; ages 9 to 23)
The youngest generation is Generation Z—the generation that has the shortest attention span of eight seconds or less. Quality matters to them more than the brand, and no matter the feedback, they’ll be sharing it on social media. To appeal to Gen Zs, communicate to them in their language, with emoticons and all that. You might also want to host games, competitions, or other events that get them engaged.
Which age demographic does your customer base belong to? You can consider their spending habits for your marketing baseline.