There is a fundamental change occurring in the structure of the UK population. By 2020, nearly half the population will be over 45, while the proportion of under 25s will drop to just 25 per cent.
Studies of the over 55s – commonly referred to as the “grey” market – conclude that this group is experiencing a new sense of emotional and financial freedom. These trends have major implications for marketers and advertisers in brand communications, market segmentation and media selection.
It is a market that advertisers cannot afford to ignore. A recent report by media consultants Carat Insight revealed the over-55s account for 40 per cent of UK consumers’ expenditure, amounting to £200bn.
But despite these impressive figures, the commercial opportunities presented by the grey market remain largely untapped. Marketing and advertising tends to focus on younger markets, while the over-55s, who constitute one-third of the total UK population, are largely ignored.
Understanding the mind-sets and motivations of target markets lies at the heart of successful marketing and advertising. The reason the grey market has so far been ignored suggests a lack of willingness rather than a lack of ability on behalf of marketers. Misconceptions about their lifestyles, ranging from bus passes and bingo cards to dentures and dementia, perpetuate the problem.
The reality is somewhat different. Carat Insight concludes that for many over-55s approaching retirement, an important personal objective is to secure good physical and mental wellbeing by engaging in active lifestyles. This can involve sports and leisure activities, as well as community issues and local affairs. Contrary to the belief that many older people are couch-potatoes, the Carat Foretel Attention Study observed that only 30 per cent of over-55s watch TV for the sake of “wanting something to do”.
A “young at heart” attitude is a key trait of the grey market and this is not only reflected in active lifestyles, but also in the desire to experiment and to continually learn. For example, Carat states that few older consumers are truly “fearful” of technology and constitute almost ten per cent of all UK Internet users.
This experimental attitude is also shown in purchasing behaviour, despite the commonly held belief that advertising has little effect on greys since they have well-cemented consumption patterns.
Despite their propensity to experiment, greys are more experienced and wiser in their purchasing behaviour. Being “time rich” allows them greater freedom to inspect the market and they prefer more informed purchases rather than impulse buys. Saga Services has found that over-55s view the information gather-ing process as an enjoyable activity.
Carat’s research also identifies key characteristics of ads which appeal to the grey market. “Clever”, “informative” or ads reflecting real life are better received by the over-55s, while “sexy” ads are the least popular. This is in stark contrast to ads targeting younger audiences, where sexual themes are often a dominant characteristic.
Overall, the over-55s exhibit a vast disparity in health, wealth and social circumstances. Consequently, classifying all 19 million greys as a single audience ignores the rich diversity in personality, character and psychological make-up.
Carat Insight director Dr Wayne Fletcher says: “Market classification by demographics alone is too simplistic for today’s audiences, and is less effective than attitudinal or psychographic approaches which can give subtle nuances.”
Lifestage analysis observes that as people move into older age group classifications, they become absorbed in local life. With a focus on community-related issues, regional press is in prime position to take advantage of these trends and is a key medium to reach the grey market. About 90 per cent of over-45s are regional press readers; 62 per cent of over-45s value their local newspaper due to the coverage given to community issues; and according to Consumer’s Choice III research, over-45s are more likely to trust regional press than any other medium.
This suggests that as the UK population ages, the reliance on regional press as a community reference, entertainment guide and information source will be greater than ever.
Rakesh Rakhia is national development executive for NS Marketing, part of the Newspaper Society.