At food and beverage conferences these days, there is a lot more discussion about segmenting shoppers — which ones are more valuable than others, and why it is critical to market specifically to them. Each of these presentations invariably includes some kind of metrics that compare the dollar value (sometimes the most ambitious presenters even offer a look at the lifetime dollar value) of each of these segmented groups.
I would suggest, however, that as consumers have changed buying habits and patterns since the recession, the majority of these models are flawed. Most are based on past performance — akin to looking at 30-day-old checkout data in order to predict what will sell tomorrow!
What we do know is that the 76 million Baby Boomers, who started to turn 65 years old last year, will control the majority of the United States grocery spend. According to the McKinsey U.S. Aging Consumer Initiative, by the year 2015 the 50-plus population will make up 52% of the estimated $706 billion spent on grocery.
In the early 1990s I spent a few years working with Ken Dychtwald, the author of the best seller “Age Wave,” who said our objective was simple: To open the eyes of many of the leading consumer goods companies to the Boomer opportunities. Sadly, it appears that many grocery companies still have their eyes shut today.
The Baby Boom generation (which comprises shoppers aged 48 to 65) is expected to have a longer average lifespan — 74.1 years for men and 79.5 years for women — and as a result are becoming more interested in those foods and beverages that offer them health and wellness benefits.
These consumers have fewer expenses and more disposable dollars than the more coveted Millennial shoppers — and while some surveys might suggest that these 16-to-30-year-olds are more food involved, they are also more influenced by the newest trends, and certainly more fickle about the brands they buy and the stores in which they spend their money.
Boomers are much more brand and store loyal, and while their lifetime value may be limited to just 10 to 30 more years, I would take that bet. It is time for our supermarkets to cater to the Boomers, not only by offering the foods, beverages and services to satisfy their growing interest (and need) for health — but to take a good look at the physical shopping experience, to make sure that the aisles are wide, to lower the shelves and most importantly to make them feel welcome and respected. A Boomer shopper may well be the most important asset in your store.
Phil Lempert is contributing editor of Supermarket News and CEO of The Lempert Report and SupermarketGuru.com.