Spare cash is feathering empty nests

Parents whose children have left home are using their higher levels of disposable income to enjoy new-found independence, according to research seen by Marketing Week.


With well-paid jobs, shrinking mortgage debts and their children no longer living at home, about a million people in their 50s and early 60s now consider about 10% of their income as disposable, according to research seen by Marketing Week.

Coupled with a ‘live for today’ attitude, the purchasing power of consumers who have seen their children fly the nest is second to none in an economy that is increasingly epitomised by the ‘squeezed middle’.

There are currently 3.7 million empty nesters with a total disposable income of £288m, which is more than double that of families with children still living at home (£102m), according to the study by ICM, which was commissioned by

Empty nesters, who are categorised as being 45 to 65 years old and the parents of children who have all left home, with the last child leaving in the previous five years, make up 8% of the UK population.


Overseas adventures: 44% of empty nesters spend their extra disposable income on holidays

Of this group, 1 million (28%) say that 10% of their overall income is disposable, while 750,000 (21%) say 11% to 20% of their money is free to spend as they wish. This is in part because of lower food and utility costs because their children have left home, but also a result of 47% of empty nesters working full time and a further 15% working for between eight and 29 hours a week.

But before marketers rub their hands in glee at the thought of being able to target such a large, cash-rich demographic, Robert Ferguson, managing director of holiday company Real Africa, warns that brands must take care not to stereotype or even to explicitly target this group (see The Frontline, below).

Ferguson explains: “This is an intelligent market, they don’t want to be pigeonholed and targeted in the same way as honeymooners for example. Families are happy to be segmented because they can seek out the kids’ clubs or free swimming lessons. Targeting the empty nester is more subliminal – it is about what they might want, not what they are.”

It is also important to bear in mind that those in middle age and beyond are feeling younger, so they don’t want to be portrayed as being ‘old’. This is partly demonstrated by the fact that clothing and footwear comes second from top of the list of items members of this demographic spend their disposable income on.

There are, however, some conclusions that can be drawn about this group, which may influence media strategy when trying to reach them. For example, there are more than twice as many female empty nesters (2.5 million) as male (1.2 million) and, overall, holidays are the most popular treat, followed by new clothes, footwear, eating out, home decor and new technology.

Volkswagen has taken this into account when planning the marketing strategy for its new Up! model, advertising the car during TV shows such as Homeland and Jamie Oliver programmes, which are popular with the group.

Once parents stop providing free accommodation for their children, other forms of parental subsidy also drop, the research finds. However, what empty nesters spend their money on changes after their last child leaves home, with new technology being on the shopping list for 21% of the sample interviewed.

With teenage children having previously been the focus of most technology in the house, the newly empty nest may now find itself without a laptop or tablet and, crucially, without a skilled teenager to operate it. managing director Sue Houghton suggests: “This is a significant proportion. Manufacturers and marketers need to be aware that their technology needs to be more user-friendly. A lot of empty nesters haven’t had to use this technology at school or work so there is a lot of scope for brand interaction here.”

Despite an implied lack of confidence in using new technology, social media isn’t uncharted territory for empty nesters. Of those visiting social media sites, 57% regularly use Facebook and 19% access it on a mobile phone. However, 38% of all respondents use no social media at all on a computer.

Luxury: Spa days are among the treats enjoyed by female empty nesters

One sector not high on empty nesters’ list of priorities is financial services. “Pensions, or any other form of financial planning, do not rate highly in the research,” Houghton states. “In the five years after their last child leaves home, people don’t really think about it. It could be a reflection of the fact that many people in this group have avoided the worst of the pension fund crisis and have their retirement income in place.”

The fact that financial planning is conspicuous by its absence in any form is also cause for concern. Could this segment be storing up problems for later?

Divorce rates go up sharply among empty nesters and with little extra obvious consideration for care in old age, there is a sense that this group is failing to make hay while the sun shines, according to Ros Altmann, director general at Saga Group.

“Social stereotypes lead us to believe that we still stop work when we’re 60, but we are living longer and have an active lifestyle for many years after retirement.

“The expectation seems to be that we can go on to enjoy holidays and so on, but you cannot afford that on a pension alone. The top 20% who can are the lucky ones. But the rest of us need to plan if we’re to enjoy anything like that lifestyle,” she warns.

So while those whose children have left home are a potentially lucrative audience for brands, marketers must make sure they bear in mind some of the financial limits of this group.

Click the chart to enlarge

The frontline


Sharon Scott, group PR and marketing manager, Champneys resorts and products

Our customer demographic is 35 to 55, which covers people in the empty nester category, but we don’t target that segment specifically. The majority of our customers are looking to improve themselves, but the angle of women who are empty nesters is an interesting one, as they tend to re-evaluate at this life stage. They don’t need to devote time to their children and there is certainly the opportunity to focus on spending time with friends or things such as going to a spa and enjoying themselves, as this research suggests.

The marketing communications have always been out there for this group, though I don’t think it needs targeting specifically. Our week-long bootcamp packages have the full age spread and are very much about the need to have quality time for yourself.

Perhaps until this life stage, the empty nesters have been too busy with other priorities to notice that there are these products and brands out there for them. The lifestyle change just needed to happen for them to be able to take advantage of what’s already out there.


Ros Altmann, director general, Saga

There are big gaps in the whole financial planning system. The care question is one that very few people in the empty nester demographic have addressed. Many feel
that saving for a pension will be enough, but it doesn’t guarantee anything unless you’re part of the increasingly rare final salary scheme.

I would like to see some way of integrating financial planning as an experience. I see no reason why customers couldn’t go on a cruise – in the same way as there are cruises to go and learn about archaeology – where financial planning is addressed. People might do holiday-type activities during the day and attend financial workshops in the evening.

The ideal place to address this is, of course, in the workplace, but it would be helpful to pay financial advisers to provide advice rather than selling a product.

Unfortunately, there are no tax incentives from the government for employers to do this, but there is an opportunity to sell planning as a service where consumers can see the whole picture.


Robert Ferguson, managing director, Real Africa (holiday company)

How to target this specific demographic is a tricky one. When you get to the stage of having a reasonable disposable income and few ties, it’s no longer about the ‘roughing it’ holiday experience. Very often, the empty nester will come to us having seen their older children doing the gap year-type experience of a safari with the tents and trucks and will now want the more luxurious version.

But though we have specialist areas of our website targeting honeymooners, for example, we won’t specifically target the empty nester market. They may be mature but they wouldn’t consider themselves part of the Saga generation. Using ‘older’ elements in our marketing would, if anything, be a turn-off.

We address this group by focusing on their needs, which are around luxury, unique experiences that appeal to ‘grown ups’. They may want to rough it on a truck during the day on safari, but they want to return to a luxury encampment or clubhouse.

This is an intelligent market, they don’t want to be pigeonholed and targeted in the same way as our honeymooners, who are happy to be categorised as such because it means they get deals such as champagne on arrival. Equally, families are happy to be segmented because they can seek out the kids’ clubs. Targeting the empty nester is more subliminal – it is about what they might want, not what they are.


Silke Anderson, communications manager, VW Marketing

We are targeting two very different segments with the new VW Up! – the starter user, who may otherwise have gone for a second-hand car because of money pressure, and the empty nester who has no need for a large family saloon and wants a small and agile but full-featured car.

While the product has been created to appeal to these two target markets, we would never reference either of them in the marketing communications. If the product is right then it naturally speaks to the segment’s needs. Instead, we target the publications, online and TV media in a way that will put it in front of the right audience.

To appeal to our younger starter market, we will focus on advertising around the TV shows that are on later at night and also look at TV-on-demand, which is a viewing behaviour much more common in this segment. However, empty nesters tend to prefer earlier viewing, the popular TV dramas and lifestyle shows such as Homeland and Jamie Oliver and don’t ‘timeshift’ their viewing.

Online is still a valuable tool for this segment as well as Facebook, which seems to span both generations and has been very successful for feedback – although we are still in the middle of the campaign and have no concrete metrics for this yet. Empty nesters enjoy interacting with us here as much as the starter users.



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