ONGOING research into the economic and social expectations of Generation X can present the marketing industry with some significant opportunities.
ONGOING research into the economic and social expectations of Generation X can present the marketing industry with some significant opportunities.
Findings from the recent AMP and National Centre for Social and Economic Modelling Generation Xcluded report have reinforced some well-known traits of Generation X.
Among these are Gen Xers’ propensity to delay the purchase of property and the decision to start a family – both characteristics that should act as a point of reference to those wanting to sell goods and services.
For instance, Gen Xers’ reluctance to leave the parental home, while a cause for concern for the property industry, highlights an age group that has greater disposable income, according to The Marketing Centre managing director Michael Smith.
“My impression is that they don’t save like the previous generation because they have a higher consumption of goods. If they are spending less on residences they have more money available to them,” Mr Smith said.
The AMP report showed that two-thirds of Generation Xers living at home were working full time.
Market Equity director Julie Beeck said home ownership traditionally signalled consumer expenditure and marketers might need to look for other triggers.
“The trigger point for spending has traditionally been when people purchase homes because they need to buy household goods and insurance, so they are popular targets for marketers,” she said.
“Now it might be a career change and change in income that is the trigger point. Advertising might now take place through recruitment pages.
“Marketers need to identify when they are likely to spend.”
The report also found that Gen Xers are highly educated and are very savvy consumers.
This puts pressure on marketers, according to Mr Smith.
“Generation X has grown up learning how to make choices,” Mr Smith said.
“Baby boomers of equivalent ages played one or two sports, joined one or two clubs. Generation X is confronted with more options then they can take and, as a consequence they have developed a skill set of making choices, but they are also are less loyal.”
He said marketers needed to carefully select communication channels.
“It’s harder to buy Gen X efficiently, given the diffusion of media types,” Mr Smith said.
Ms Beeck said marketers needed to be more creative when targeting the various consumer segments.
“The young singles, then the families, then the empty nesters are not the only segments. Marketers should be looking for other segments, such as [those that are] attitudinal or needs based,” she said.
“The next thing they need to do is tailor communication. Marketers can no longer have a scatter-gun or product-driven approach to branding”
Brands need to adapt to the market, according to Mr Smith.
“The brand has to be contemporary and continually cycling through images. For example, Coke has to update its images more rapidly than it did in the past,” he said, adding that marketers needed to invest in riskier promotions.
AMP national manager of superannuation and retirement policy, Suzanne Doyle, said financial services companies should target these consumers who could find the financial going tough later in life.
“Baby boomers are very much about the here and now and Generation X have picked up on those habits and have implemented them,” Ms Doyle said.
“But this group is also in debt. They have university fees and they’ve had credit cards for years.
“This research is a real eye opener for Generation X because if they are going to get ahead they need to be doing something about it. A lot of them have superannuation because they have had to, but the next step is to get a savings plan and have regular investments that allow them to get the house and family.”
