Boom: Big spenders ain't babies

The kids have left home and baby boomers have more disposable income than most sections of society, something advertisers are starting to cotton on to.

Baby boomers - the generation whose bulge in the population has been likened to a "pig in a python" - are about to shake up the advertising world.

As the first of the boomers turn 60 next year, at least two specialist advertising agencies aimed at older consumers have set up shop in the past five months while other agencies have begun to talk to clients about the coming shift.

The message they're delivering is that advertising needs to change.

Chris Schultz, a director of new agency 50+ Advertising, said in the 1970s advertisers used to think that if once you got customers, you kept them for a lifetime.

That led to the youth-oriented advertising that baby boomers - those born between 1946 and 1964 - have had the most exposure to as the first consumer generation; the television generation.

The latest studies show older consumers are as likely to switch brands as anyone. But advertisers are still focusing on youth.

"We recognised the opportunity about two years ago," said Schultz. "This market is basically ignored. There's hardly anything produced that appeals to this generation."

While 50+ is not telling clients to change their strategy completely, it is telling them to think of the secondary market - the boomers - and campaign to them with different messages.

Schulz said there was a significant risk to advertisers if they ignored the ageing of the baby boomers.

"There's an agency in Europe called Senior Agency - they've worked out if you focus on the under-50s market and maintain your market share for your brand for the next 20 years you'll get zero growth.

"If you focus on the 50-plus market for the next 20 years you'll get 20 per cent to 30 per cent growth in your brand if you maintain your market share in that brand."

Lauren Edwards, a director of specialist agency Evergreen, said more often than not, if someone older was being depicted, it was in a mocking way.

"These people have 20, 30, 40 years of buying power left. That's the same number of years to have a grudge against you if you've had advertising that's taken the mickey out of older people."

She said households containing people aged 45 to 54 had an average of $46,000 to spend on discretionary goods and services every year, after rent or mortgages. That made up 25.2 per cent of their overall household spending.

Meanwhile, households with people aged 25 to 34 had $36,450 on average to spend on discretionary goods, just 16.2 per cent of their household spending.

Significantly, while the 55 to 64 age group had $36,816 on average a household to spend on discretionary items, by 2011 their level of discretionary spending would rise by almost a third, compared with a meagre 4 per cent increase for the 25 to 34 group.

It's not just the specialists. Di Rice, media director at Mediaedge:CIA said she had begun to talk to clients about the topic - but some advertisers were hard to convince. "Now they [the baby boomers] are reaching a different stage of their lives, their attitudes and requirements are a little bit out of sync with the age and lifestyles of some of the people in marketing departments," she said.

"There are still a lot of those stereotypes of older people with grey hair who do their knitting and dote on their grandchildren, but the reality is a long way from that."

Schultz said brands such as Panadol and Dove had it right, with their ads featuring older people as still beautiful or active.

"These people, who grew up in the 1960s and 1970s, have challenged the status quo and changed everything they've touched. They are fitter and healthier, experienced and savvy. That's why to have the correct message reach the correct medium is important."