Generational CohortsGenerational Cohorts

Presented by Nicki StajcarIowa Department of Elder Affairs

Statewide Transportation Conference November 1, 2006

Cohort Model

Generational Cohort• Individuals who experience same event

• "What world events over the past 50 years were especially important to you?"

• Ages of respondents correlated with importance rankings

• Seven distinct cohorts

Cohort Model Depression cohort (1912 - 1921)

• Memorable events: The Great Depression, high levels of unemployment, poverty, lack of creature comforts, financial uncertainty

• Key characteristics: strive for financial security, risk averse, waste not want not attitude, strive for comfort

WWII cohort (1922 - 1927) • Memorable events: men leaving to go to war and many not returning,

the personal experience of the war, women working in factories, focus on defeating a common enemy

• Key characteristics: the nobility of sacrifice for the common good, patriotism, team player

Post-war cohort (1928 - 1945) • Memorable events: sustained economic growth, social tranquility, Cold

War, McCarthyism • Key characteristics: conformity, conservatism, traditional family values

Schuman and Scott, 1989

Cohort Model

Leading Edge Baby Boomer (1946 - 1954/55)

• Memorable events: assassinations, political unrest, walk on moon, Vietnam War, social and drug experimentation, sexual freedom, civil rights movement, environmental movement, women’s movement, protests and riots

• Key characteristics: experimental, individualistic, free spirited, social cause oriented

Schuman and Scott, 1989; others

Cohort Model

Trailing Edge Baby Boomer (1955/56 - 1964/65)

• Memorable events: Watergate, Nixon resignation, defeat in Vietnam, oil embargo, raging inflation, gasoline shortages, economic competition

• Key characteristics: less optimistic, distrust of government, general cynicism, credit/debt orientation

Schuman and Scott, 1989; others

Cohort Model

Generation X cohort (1965 - 1976) • Memorable events: challenger explosion, Iran-Contra,

social malaise, Reaganomics, AIDS, safe sex, fall of Berlin Wall, single parent families

• Key characteristics: quest for emotional security, independent, informal

N Generation cohort (1977 - 1990s) • Memorable events: rise of the Internet, 9-11 terrorist

attack, cultural diversity, 2 wars in Iraq

• Key characteristics: quest for physical security and safety, patriotism, heightened fears, acceptance of change

Schuman and Scott, 1989

Boomers Defined

Born 1946 – 1964 (age 42 - 60 today)

• Born or immigrated to US

• Over 26% of the population

• 76 - 78 million persons

• 48% of households

• 34 million households

MetLife Mature Market Institute Analysis, 2005

Boomers Defined

Born 1946 – 1964• 49% male

• 51% female

• By 2030: 66 – 84 yrs old

• By 2030: 20% of the US population

MetLife Mature Market Institute Analysis, 2005

Younger Boomers (1956 - 64)

23.9 million households Purchasing power: $1.1 trillion Avg. # earners in household: 1.7 Avg. annual household income: $56,500 Avg. annual spending per household:

$45,149 (80% of income)

American Demographics, 2002; US Bureau of Labor Statistics, 2003

Younger Boomers (1956 - 64)

Priority: children 69% own their own homes Spending

• 11% > avg. on pets, toys, playground equipment

• 38% > avg. on mortgage payments

• 10% < avg. on life and personal insurances

American Demographics, 2002; US Bureau of Labor Statistics, 2003

Older Boomers (1946 - 55)

21.9 million households Purchasing power: $1 trillion Avg. # earners in household: 1.8 Avg. annual household income: $58,889 Avg. annual spending per household:

$46,160 (78% of income)

American Demographics, 2002; US Bureau of Labor Statistics, 2003

Older Boomers (1946 - 55)

Spending • 11% < avg. on children’s items

• 50% > avg. on home upgrades and products

• 11-13% > avg. on adult apparel

• 23% > avg. on hotels and vacation homes

• 20% > avg. on life and personal insurances

American Demographics, 2002; US Bureau of Labor Statistics, 2003

A Comparison

Younger Boomers:

Current ages: 42 - 50

23.9 million households

Purchasing power: $1.1 trillion

Avg. # earners in household: 1.7

Avg. annual household income: $56,500

Avg. annual spending per household: $45,149

Spending as % of income: 80%

Older Boomers:

Current ages: 51 - 60

21.9 million households

Purchasing power: $1 trillion

Avg. # earners in household: 1.8

Avg. annual household income: $58,889

Avg. annual spending per household: $46,160

Spending as % of income: 78%

Marital Status

68.8% married 14.2% divorced (> prior generations)

12.6% never married (> prior generations)

2.9% separated 1.6% widowed

US Census Bureau, 2000

Education

Boomers have a higher level of education than any prior generations• 88.8% completed high school

• 28.5% have Bachelor’s Degree or more

US Census Bureau, 2000

Housing

35-44 45-54 55-74

Homeowner 69% 76% 82%

Mortgage 57% 56% 44%

No mortgage

12% 20% 38%

Renter 31% 24% 18%

MetLife Mature Market Institute Analysis, 2005

Family Life

In < a decade, Boomers will comprise 52% of all grandparents

By 2010, Boomer grandparents will grow from 18 million to 37 million

JWT Mature Market Group, 2006

Family Life

Caregivers are typically females, 45+, with children at home and key influencers in health care and senior housing decisions

2/3 of all caregivers are Boomers Age cohort with the highest percentage

of caregivers is 45 - 49 (13%)

Retirement Lifestyles

80% will work at least part-time 30% plan to start own business Second or third careers Delayed retirement

• Nearly 1/3 had children later and may still pay tuition

• Desire to maintain present lifestyle

• Savings of $2.5 million to maintain current spending

• Inadequate retirement savings

Travel & Tourism Consumers

Extensive travel Immersive learning (“Edutainment”)

Peak experiences Heritage tourism Cultural tourism

• Rock and Roll Hall of Fame

Nostalgic coming-of-age tourism• A “Beatles London” tour

Financial Services Consumers Only 40% of workers born 1951 – 60 are on

track to cover basic expenses in retirement Those waiting until their 40s must save 25 –

35% of income 78% aren’t very satisfied with personal

finances 70% have not met their financial expectations Getting out of debt is #1 goal of empty

nesters Boomers will work longer

Retirement Housing Consumers

55% plan to move when retired 51% will move > 3 hours away Paramount issues

• 62% want less maintenance

• 23% want smaller home

Retirement Housing Consumers

26% will consider Active Adult Community• 30% prefer urban location

• 29% want local natural benefits

• 22% prefer AAC within multi-generational development (> twice the % of those 59 – 70)

Retirement Housing Consumers

Tailored features On-site health and wellness Fitness and therapy Food choices Enabling technologies Lifelong learning Work and voluntarism access

Retirement Housing Consumers

Tailored hobbies and interests Emotional and spiritual wellbeingTransportation Ties with family and friends Guest facilities and amenities Homelike architecture and living Sustainable design

The Cool Cohorts

Chronically cool• Regardless of age,

Boomers continue to think they define the way life and people should be.

Media: TV

First generation to grow up with TV• Adults 35 – 64 average 248 minutes/day

• Adults 18 – 34 average 226 minutes/day

Viewership increases with age Prefer more intelligent / sophisticated

programming than earlier generations

Media: TV

Older boomers• CSI

• The West Wing

• ER

• News programs

• Lifetime cable network

• Science fiction

Younger boomers• ER

• Friends

• Survivor

• Reality shows

• Science fiction

Media: Radio

Listen to radio average of 21 hours / week 2 hours more / week than other adults

• Older boomers• News / talk #1

• Rock #5

• Younger boomers• Adult contemporary #1

• Rock #2

Media: Internet

By 2009, over ½ of all heads of household will be > 50

Worked at least ½ their careers on computers

Children and grandchildren are online and bring older loved ones along

The mature market is the fastest growing segment on the internet

Media: Internet

Most frequent online activities for 50+• Driving directions 56%

• Weather 55%

• Travel information 54%

• Community/local events 35%

• Purchase airline tickets 33%

Trends: Freedom

Fastest growing segment of motorcyclists• Increasing 10% / year

• Nearly 1/3 of Harley riders are 50+

Trends: Self-Actualization

Self-discovery Self-expression Balance Life satisfaction Community Holistic solutions Spirituality

Trends: Community

Communal experiences• Large classes

• Rock concerts

• Communal living

Sense of generational community Group engagement

Trends: Children’s Approval

Children’s approval is more important to Boomers than any previous generation

39% hold family & friends as the most important life area (29% for older generation)

Children are “influencers”• Consumer roles

Targeting Your Boomer Consumers

What are you doing in your environment?

What are the challenges?

What can you start doing?