December 20, 2010

Problem with the pyramids

Much has been written in recent years about how unprecedented, future demographic changes will dramatically affect society via authors like David Foot and futurists such as Andrew Zolli and I always wanted to know exactly what that meant in clear terms. Consequently, I have tried to to summarize below some of the potential ramifications on our daily lives that these shifts may bring.

In a stable, developed country in normal times, a typical population pyramid (see 1950 graph below) has a lot more younger people in population vs. a small amount of older people at the peak of the pyramid

However, as the baby boomer generation passes through, society in developed countries shall be faced with a huge number of challenges as an unprecedented situation shall arise: the older population will become the vast majority and the pyramid shall be inverted. (see above 2050 pyramid.)

  • Baby Boomers, who are in the vast majority, have always redefined each of their life stages and as a group have not generally followed rules. As retirees, they are unlikely to want to fit the traditional mould of older people with slippers, a cup of cocoa and relative inactivity. They are likely to be adventurous and active, and certainly want to retain the last grasp on their youth
  • In addition, the North American population will continue to become more Multicultural and more female skewed

Boomers at retirement are expected to fall into 2 groups:

  1. Those who didn’t save enough and have to continue working long into retirement &
  2. Those who made a hell of a lot of money over their lifetimes, who shall simply take a permanent vacation and eventually party themselves to death!

Consequences of this demographic shift on the Work Place

  • Likely to create difficulties for some Gen Xers in the workplace since the Boomers who do not have enough money to retire shall continue in the workplace for as long as possible, preventing Gen Xers from rising higher. Some estimates suggest that the future retirement age around 2030 could be 74
  • However, on the other hand, the huge numbers of vacationing retired Boomers may leave a huge void in the workforce that cannot be filled by Gen Xers, simply because there are not enough of them for the posts that will become available
  • Behind the Gen Xers are the Millenials with their IT skills, a lust for social media and an abundance of self belief, that could clash hugely with the mentality of the much older Boomers

Consequences on Family Life

  • For those Boomers who run out of money at retirement, of which there shall be many, many are expected to return to live with their kids.
  • The typical modern family unit of the future is expected to resemble a family of the early 1900s with 3 or 4 generations living under one roof.
  • In addition, for Millenials who expect to live forever, it is predicted that they shall drag out their early adulthood by staying at home, adding to this larger family unit

Consequences for us as marketers

  • This older generation of boomers shall hold vast reservoirs of disposable income
  • Products and services shall have to evolve to tap into this extremely powerful demographic of Boomers so that they are attractive and easy to use for older customers
  • Smart marketers shall help them retain their youth in an adventurous exciting way with new products and services aimed at their mindset
  • Marketers shall need to figure out how to engage their products and services with multi generational families

Devices, products and the way we communicate to this powerful group need to alter radically and those brands who figure it out are going to be cruising into the marketing sunset like Henry Fonda in Easy Rider!

Posted by Rob Booth | Filed under: All, General, Useful | No comments yet - be the first

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