• Ad Age, Monday, July 7, 2008 12:30 PM

The average U.S. head of household is now nearly 50 years old, and more than 80% of the growth in the number of households in the next five years will be among those headed by people 55 and older. In fact, aging baby boomers will add more than 1 million consumers per year to the 65-and-older segment during that time -- increasing its number at more than twice the rate of the past five years.

Fortunately for marketers, the chances are rising that not many boomers will be retired by 65. But that doesn't change the presence of a Medicare card in their wallets and the psychological effect it's likely to have. For one thing, it fosters more risk-averse behavior. This will present several challenges.

The first is that risk-averse consumers want to hear at least two of these three words: guarantee, safety and experience. Risk-averse consumers are also very much interested in price (read: senior discount), but a low price by itself probably will not close the sale if there is any perceived risk of nonperformance. The increasing number of such consumers suggests we will see greater use in advertising of warranties, prominent displays of long corporate histories, exhibits of financial strength and testimonials.

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