Many marketers have realized that today's Boomer consumers are still worthy of their attention, so now they are scrambling to find the best segmentation scheme. That's because they want to determine
which specific parts of the large Boomer cohort are their best prospects.
The problem, of course, is that most segmentation schemes have little value to most marketers. They are too general, and
while interesting, are not actionable.
Fundamentally, segmenting any audience starts with the immutable facts: age and gender. Age reveals two important components -- the generational cohort
of the consumer and his or her physical and cognitive development.
Generational cohort is important because the time and place in history in which someone matures, or comes of age (ages 10 -
20 or so), the events they experience -- world events, political, societal, cultural -- affect their worldviews and values. It's what makes Boomers different from their parents, and from their
children.
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Physical and cognitive development is important because as we age we continue to change and evolve. Boomers at ages 46 to 64 are different physically and mentally than when they were
26 to 44 years old. For example, all Boomers have begun experiencing changes in their vision, hearing, mobility, flexibility and other physical changes. And, Boomers at this age are becoming less
concerned with acquiring more material things and are seeking out more and better experiences. This "middle age" stage of life brings with it the acceptance of the potential reached so far and a more
realistic view of what can be achieved.
Age, therefore, must be the foundation of any segmentation scheme that you put into action. But, it isn't where you end. It's where you start.
Choice Factors
The next two levels of a more successful segmentation scheme are rooted in choices made by consumers -- Life Stage and Life Style. Actually, one has considerable
influence over their life stage -- married, single, parent, working, retired. Some stages are outside control, but how much one embraces or rejects the life stage affects one's behavior (caregiver,
grandparent are two life stages that some embrace and others reject).
Nonetheless, knowing the consumer's life stage is critically important in determining potential consumer behavior. Do they
have kids? How old are the kids? Do they still live at home? Are their parents alive? Are the parents in good health? Does the consumer work? Retired? Obviously, each life stage comes with its own set
of wants and needs.
Similarly, understanding the life style and socio-economic status of the consumer is important. How are they living their lives? What are their interests and activities?
Understanding their chosen life style reveals much about their consumer behavior, but not the whole story.
In most segmentation schemes, the big "aha" comes by overlaying consumer attitudes on
top of the four stages we've built so far. But marketers will be better served by first inserting transactional data into the mix long before looking at attitudinal differences. Actions speak louder
than words.
Follow the Money
You should mine your purchase data to see who buys. That's because in order for segmentation to be of value in the board room, where money
is king, you better understand which customers make you money and which ones don't.
For example, if analyzing purchase data tells you that 80% of sales come from 20% of your customers, guess
whose attitudes you'll want to better understand? Segment that group to learn about their attitudes and perceptions, and then turn your attention to the remaining customers to determine which could
become better customers, and who in your prospect universe fits that model best.
The bottom line is the bottom line for any successful segmentation scheme. If you start, and finish, by looking
at purchase activity -- and not attitudes -- you'll be well on your way to creating a segmentation scheme for Boomers that will work for your company or organization. And in your board room as well.
Everything else is just talk.