September 16, 2004
Excerpts: Everything You Need to Know About Strategy - Part XIII
11. Do you understand ... to your very marrow ... that the two biggest under-served markets are Women and Boomers-Geezers? And that to take advantage of these two Monster Trends (FACTS OF LIFE) requires fundamental realignment of the enterprise? War has broken out over your home-improvement dollar, and Lowes has superpower Home Depot on the defensive. Its not-so-secret ploy: Lure women.Forbes.com The New Customer Majority [ages 44-65] is the only adult market with realistic prospects for significant sales growth in dozens of product lines for thousands of companies. David Wolfe & Robert Snyder, Ageless Marketing Baby-boomer Women: The Sweetest of Sweet Spots for MarketersDavid Wolfe and Robert Snyder, Ageless Marketing Marketers use powerful new tools to reduce segments into ever thinner sliceseven slices of one, according to the new Dogma of One-to-One Marketing. Im an unabashed champion of the new tools. Nonetheless their use should not be an excuse for stupidly ignoring something much bigger: the potential of realigning the enterprise to better serve Women and Boomers-Geezers. These two overwhelming forces are still ignored or absurdly undervalued by the vast majority of companies, large or small, consumer oriented or business-to-business oriented. And make no mistake: Getting with the program is not about segmentation; its about (Here I go again!) wholesale cultural realignment of the enterprise. Women = Opportunity No. 1 Start with women. They buy everything. (Not much of an exaggeration.) Consider these stats from the U.S., UK, Canada, Australia, and New Zealand. Womens share of purchases: Home Furnishings ... 94% Vacations ... 92% Houses ... 91% D.I.Y. (major home projects) ... 80% Consumer Electronics ... 51% (66% home computers) Cars ... 68% All consumer purchases ... 83% Bank Account ... 89% Household investment decisions ... 67% Small business loans/biz starts ... 70% Health Care ... 80% And its not just consumer purchases. In the U.S., for example, women account for more than half of professional purchasing officers, admin officers, and HR officials. Hence, she is just about as likely to sign the P.O. for a $5 billion IS/IT outsourcing contract as for the family Mercedes. (By the way, when it comes to those consumer goods, perhaps youd be interested to know that, lingering wage inequalities notwithstanding, womens income rose 63 percent over the last three decades, while mens crept up by 0.6 percent. Ive got hundreds of gotcha stats like that, painstakingly collected over the last eight years. Many are presented in my book Re-imagine!) So women buy all the stuff. The second Big Fact is that ... you heard it here first ... women and men are different in their approach to purchasing things. Trendspotting guru Faith Popcorn summarizes: Men and women dont think the same way, dont communicate the same way, dont buy for the same reasons. He simply wants the transaction to take place. Shes interested in creating a relationship. Every place that women go, they make connections. In America's Competitive Secret: Women Managers, Judy Rosener adds, Women speak and hear a language of connection and intimacy, and men speak and hear a language of status and independence. Men communicate to obtain information, establish their status, and show independence. Women communicate to create relationships, encourage interaction, and exchange feelings. These clear and compelling truths have structural implications of the first order for enterprises. Faith Popcorn and Lys Marigolds bible on this, EVEolution: The Eight Truths of Marketing to Women, provides one of the few roadmaps for considering such fundamental realignment. Consider Truth No. 1: Connecting Your Female Consumers to Each Other Connects Them to Your Brand. The Connection Proclivity in women starts early, Popcorn and Marigold write. When asked, How was school today? a girl usually tells her mother every detail of what happened, while a boy might grunt, Fine. Its good for a knowing laughand jillions of dollars in revenue, if you get it right. Bottom line on this sample First Truth: Women dont buy brands. They join them. A brilliantly successful Manhattan financial planner (male!) confirmed the Popcorn-Marigold truth. Years ago he successfully re-oriented his practice toward serving womens needs. He told me that his average male client recommends him to 2.6 others; his average female client spreads the word to 21 colleagues. Such striking (gaping!) differences have become staples of my eight-year quest for understanding.
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Secrets of Marketing to Women
1. Show her real women and reliable scenarios.
2. Focus on connection and teamwork.
3. Capture her imagination by using stories.
4. Make it multisensory.
5. Add the little extras.
6. Tap the emotional power of music.
7. Create customer evangelists.
8. Form brand alliances.
Source: Lisa Johnson & Andrea Learned, Dont Think Pink: What Really Makes Women Buy and How to Increase Your Share of This Crucial Market
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Let me be clear. I am on a mission here. But, alas, it has little to do with social justice, or any other lofty aim. My aims are economic. I believe the Business Opportunity is enormous (womens purchasing power in the U.S., consumer and business goods and services combined, is about $6 trillion) ... and that damn few enterprises are embracing the Business Opportunity at the level of Fundamental Enterprise Realignment. Further, I believe that those who shortchange this opportunity are simply ... stupid.
To conclude on a slightly less rancorous note, Ill offer my summary remarks as they appear on a PowerPoint slide I use to conclude this segment of my presentations:
1. Men and women are different.
2. Very different.
3. VERY, VERY DIFFERENT.
4. Women & Men have a-b-s-o-l-u-t-e-l-y nothing in common.
5. Women buy lotsa stuff.
6. WOMEN BUY A-L-L THE STUFF.
7. Womens Market = Opportunity No. 1.
8. Men are (STILL) in charge.
9. MEN ARE ... TOTALLY, HOPELESSLY CLUELESS ABOUT WOMEN.
10. Womens Market = Opportunity No. 1.
Boomer Bonanza/Godzilla Geezer
Hooray, time to pick on marketers again! Their preferred mantra: Its 18-44, stupid! My suggested variant: 18-44 is stupid, stupid! (Ah, that S-word, again ... Stupid. Well, cant be helped.)
Start with the simple stats: The cherished (by stupid marketers) 18-44 segment will decline in population by 1 percent in this first decade of the new century. On the other hand, the 55+ segment in the U.S. will increase by a hearty 21 percent ... and the 55-64 bunch will leap by a staggering 47 percent. (Yikes.) (Note: Boomers, born between 46 and 64, number about 78 million in the U.S.) (Note: These U.S. numbers pale by comparison to the even more extreme aging stats coming out of Western Europe and Japan.) (Note: Another designation comes from Wolfe and Snyders Ageless Marketing, quoted above; they offer the new customer majority, the enormous-wealthy group who are currently between age 44 and age 65.)
To cut to the chase, heres the story in brief:
1. The numbers of people involved are ... enormous.
2. The wealth of these people is ... staggering. (The 50+ group in the U.S. controls 70 percent, or $7 trillion, of our wealth.)
3. This is the first aging group that ... refuses to act their agea very cool thing for goods and services producers. (Sixty Is the New ThirtyAARP magazine cover in 2003.)
4. The Boomer-Geezer cohort mostly wants to buy ... experiences. (See No. 10 immediately abovemore reinforcement for the notion I championed.)
5. One more time: VERY FEW FIRMS ARE AGRESSIVELY ADDRESSING THIS ISSUE-OPPORTUNITY. (Addressing = Realigning culture to Embrace the Boomers-Geezers.)
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Marketers attempts at reaching those over 50 have been miserably unsuccessful. No markets motivations and needs are so poorly understood.Peter Francese, founding publisher, American Demographics
Focused on assessing the marketplace based on lifetime value (LTV), marketers may dismiss the mature market as headed to its grave. The reality is that at 60 a person in the U.S. may enjoy 20 or 30 years of life.Carol Morgan & Doran Levy, Marketing to the Mindset of Boomers and Their Elders
Age Power will rule the 21st century, and we are woefully unprepared.Ken Dychtwald, Age Power: How the 21st Century Will Be Ruled by the New Old
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So ... two enormous opportunities. Going wanting in 9 out of 10 cases. Why? Is it more than stupidity?