Media Consumers: Under-Valued But Over-Profitable
What was 2009's most successful new release; what is on track to be the best-selling album of the year; and what will surely be the most profitable release of the year? Not John Mayer or Taylor Swift. It came from Susan Boyle, the singing phenomenon whose "I Dreamed a Dream" was released in late November.
Boyle's success illustrates two important trends: older consumers (and older singers) can drive mass-media events, and do so more profitably than younger consumers. The Boomer women driving Boyle's sales purchased the album almost exclusively in the CD format: only 6% purchased it via downloads (at the same time, almost half of those who bought John's Mayer's new release purchased a download).
In a recent VibrantNation.com survey of our members (smart, successful women 50+), 40% said that they purchase more than six CDs each year (94% define themselves as music fans). Given that lost margins on CDs sales have driven the music industry into crisis, it should be producing more music that appeals to Boomers, and marketing the music it does produce more directly to Boomers.
Boomers are also avid (and profitable) movie fans, and like the music industry and Susan Boyle, Hollywood is starting to notice. Universal bankrolls 60-year-old filmmaker Nancy Meyers to make movies that feature and speak to women like her, and this year it even gave her "It's Complicated," a special prize with its Christmas Day release.
That decision was rewarded. "It's Complicated" beat expectations by selling over $22 million in tickets on Christmas Day. Seventy-two percent of its audience was female and 75% older than 30. Given the "slow build" women often generate (via word-of-mouth) for movies they love, "It's Complicated" should have a good run.
Like consumers of all ages, Boomer women reward media companies that give them authentic attention. As an excellent New York Times article about Nancy Meyers said, "In a movie culture consumed by youth and its trappings -- vampires, werewolves, stoners and superheroes -- Meyers's decision to pay attention to a part of the population that is often construed (and often construes itself) to be invisible stands out in bold relief. The fact that this decision has proved to be commercially shrewd says something about her instincts as a moviemaker but also says something about a previously unsatisfied hunger, composed of two parts daydream and one part hope, that is finally being addressed."
Old Tech to New Tech
While media companies scramble to meet the rapidly changing consumption patterns of young consumers, they could both profit and learn from Boomers, who are sustaining the "old school" formats like CDs and cable even while they rapidly adopt newer formats like MP3 players and smartphones. A recent VibrantNation.com survey revealed that almost half listen to downloaded music and one out of four who owns a smartphone uses it to watch videos or movies.
As multi-format consumers, Boomers could hold the key to sustainability for media companies struggling with the digital age. Delivering more content that appeals to Boomer consumers would reliably increase profits (because Boomers generally rely on higher-margin formats), thereby buying time for media companies time to develop profitable business models for younger consumers -- and to prepare for the Boomers to go fully digital around the time they retire!