• by Matt Thornhill , September 27, 2010

Last week we learned that the Great Recession (part one) was from December 2007 through June 2009. Lasting a full 18 months, it has been the longest downturn since the Great Depression.

Most agree that the jury is still out on whether there will be a part two.

Also last week in this very space, Brent Bouchez made a passionate and valid case for marketers and advertisers to focus their attention on the 50+ segment because that is where the money (still) is. Brent is right, but this recession has affected how Boomers think, feel and act when it comes to spending money. And it is a change you need to know about and understand as you craft your 50+ business plan (you are crafting one, aren't you? If not, go back and read Brent's piece again).

Boomers, like most consumers, have moved to a new place when it comes to spending money.

Thanks to our partnership with BIGresearch and its Consumer Intentions and Actions study, each month over the last three years we have been monitoring the attitudes of Boomers on a variety of spending and money issues. The first week of each month, BIG fields a huge survey among a representative panel of consumers, ages 18 to 80, asking all sorts of questions about where they shop, what they buy and what they plan to do next.

One such question is about behavior: "Over the last six months, have you made any of the following changes?" The simple "yes" or "no" vote gets tallied and, month-after-month, we can determine trends. Three changes are about spending money:

• I have become more practical and realistic in my purchases ... yes or no

• I have become more budget conscious ... yes or no

• I focus more on what I NEED rather than what I WANT ... yes or no (emphasis mine)

The higher the score, the more fiscally responsible or conservative consumers are. The lower the score, the more free-spending and loose consumers are.

Here's the chart since September 2007, months before the Great Recession's official start, through this September (the BIG survey is fielded the first week each month and the data released by the 20th, so we can track fresh trends).

 

You'll see the sharp increase in all three scores as we moved into the recession. The peak for all three occurred in early 2009; it seems once the new Administration took office, Boomers eased their attitudes about money and spending. Until this summer, when the scores began moving back up.

The New Normal

The trend line is important, but the broader point is that, on each measure, Boomers are not close to returning to the same level of attitude about spending money. The "floor" is some 10 percentage points higher than it was in September 2007, pre-recession.

Looking toward this holiday season, Boomers remain cautious about spending. In September every year, BIG asks "Based on your present situation and feelings toward the economy, which of the following best describes your plans for the December holiday season?"

Over 40% of Boomers said, "I plan on spending less for gifts than last year." Last year that figure was 44%. In 2008 it was 43%, and in 2007, pre-recession, it was 35%. Four out of ten spending less doesn't bode well for retailers, again.

The evidence continues to mount that there is a new mentality among consumers, especially Boomers, when it comes to spending money on goods and services.

If your job is to figure out how to best motivate them to spend it with your company, your job has a new normal, too. It's much harder.