CAPTURING A COMPLEX MARKET: THE BABY BOOMER DILEMMA
Byline: Joanna Ramey
WASHINGTON — When targeting baby boomers, the oldest of whom turn 50 this year, cosmetics companies should consider many points, experts say.
While brand loyal, the post-World War II generation is made up of critical thinkers and keeps an eye out for new products from rival companies.
They thrive on facts, choosing products with practical information over those with fluffy claims.
Despite similarities, babies born between the end of the war and the assassination of President Kennedy aren’t all alike and thus should be viewed as belonging to separate boomer age groups separated by roughly five years. Therefore, companies need to market their products to each niche.
Although they’re looking for value, it doesn’t mean they’ll buy the cheapest product.
The cosmetics industry anticipated the aging of baby boomers several years ago and began rolling out barrels full of alpha-hydroxy acid-based exfoliants and other wrinkle-defying products to court consumers newly aware of their emerging crow’s feet. The anti-aging segment now is exploding with products, creating an important battleground for the war between mass market cosmetics and department store brands, experts say.
“I don’t think anyone knows at this point who has a leg up. Clearly, the mass market is a huge growth area, but the department store brands — although they haven’t grown much because of retailing in general — still have a strong base,” said Peg Smith, chairperson of the Cosmetic and Fragrance Marketing Department at the Fashion Institute of Technology.
As part of her periodic surveys of the cosmetics marketplace, Smith recently spent two hours on a Saturday observing boomers and their buying habits at the Aveda boutique in SoHo. Shoppers perused ingredients, examined packaging and lined up at the counter armed with questions about AHAs, sun protectors and antiwrinkle creams. More often than not, a sale was made, she said.
“I would judge most of the customers in that store to be in their 40s. It was nonstop busy the whole time. The products are definitely targeted at the whole boomer group. The baby boomer market is a tremendous growth area,” Smith said.
Defining baby boomers in order to target them is tricky.
“The group extends from roughly the birth years from 1946 to 1963. That’s almost two generations’ worth. The group is very difficult to characterize. People like myself who were born in 1946 are more like our parents than those born 20 years later,” said Howard Hayghe, a Bureau of Labor Statistics analyst.
Their differences aside, boomers’ demographics collectively are formidable. According to the BLS, last year there were 30.4 million women aged 35 to 49, or 29.4 percent of the population of women over the age of 16. By comparison, in 1980 there were 19 million women in the same age group, comprising 21.3 percent of the population of women over 18.
Earnings within the boomer age bracket are also sizable. In 1994, the latest year wage statistics are available, the average annual salary for women 35 to 49 working full time was $28,600, accounting for 70 percent of employed women in that age group.
Beyond demographics, another way of cluing into boomers is to focus on what has shaped their lives, which indirectly has affected their attitude toward how they spend their money.
“You need to look at each decade of their lives from birth to now and examine the major social and cultural events that influenced them,” Smith said. “They grew up with assassinations, the Vietnam War, environmental issues, a social awareness. That’s part of where they’re coming from.”
Robert J. Untracht, national director of retail services at Ernst & Young, characterizes boomers as being more cognizant of prices than someone below the age of 35, the youngest of the generation.
“It’s a smart group of people who are watching their dollars. Ten or 20 years ago they were spending like crazy,” Untracht said. “While they are still buying, they are clearly stretched. They are now looking at saving money and retirement, which hasn’t been true before.”
The boomers’ sense of economy has helped to fuel gains in mass market cosmetics sales, as consumers respond to expanded skin care lines offering promises similar to higher-priced department store brands, according to Andrew Philip, a cosmetic industry consultant and former president of Shiseido North America. He lists not only chain drug discount stores among boomers’ cosmetic sources, but also QVC and the Home Shopping Network, as well as Avon. The World Wide Web will be the next venue to plug into boomers’ needs, he said.
“The baby boomers have been buying skin care products for 20 to 30 years, and they started buying in the department stores where they got a lot of choice, selection, consultation and service,” Philip said. “Now they have that knowledge. They got their education via the department store, they know their skin type and they are saying, ‘Now I’m going to buy products in the mass market.”
Lynn Emmolo, vice president of marketing at Avon, divides the baby boomer market into two groups: women in their mid-30s at the tail end of the boom, who, she said, tend to be more savvy, and those in their 40s and older, who have more traditional outlooks. Perfect Wear Lipstick and Incredible Length mascara are among Avon’s favorites with the lower end of the baby boom spectrum, Emmolo said. The older boomers buy Avon’s Face Lifting Moisture Firm Foundation and Hydrofirming Cream.
Like many of its competitors, Avon targets baby boomers in a subtle way, without mentioning their age or the fact that they’re any different than other age groups. This approach allows advertising to cross into various age groups while maintaining the same message.
“We try to use a simple message that’s reachable to all,” Emmolo said.
The interest in baby boomers among cosmetic companies has helped to invigorate an industry that thrives on the axiom “newness sells,” said John Horvitz, an industry analyst. But in marketing the new array of treatment products, many companies — particularly in the prestige end of the market — have to court customers who are knowledgeable about the myriad prices and choices on the market, he said.
“Having a prestige name isn’t sufficient anymore,” Horvitz said. “There are more working women with disposable income, which they spend intelligently. They shop with a greater awareness of price, value and quality.”
But that doesn’t mean boomers are predisposed to bargain-hunting in the mass market, Horvitz said. “When it comes to something she puts on her face, like a serious heavy-duty cream, she may think twice about going to a drugstore.”
At Chanel Beaute, where treatment products comprise one-third of business, customer service has been beefed up with an in-store consulting program called Skin Care Confidence, designed to target baby boomers’ queries about their changing skin.
“If you don’t give them enough information on the technical end, assuming they’ll buy Brand X because you just introduced it doesn’t work anymore,” said Jean Hoehn-Zimmerman, senior vice president of marketing and sales.
As long as a product delivers results, customers will be willing to pay premium prices, says Muriel Gonzalez, senior vice president of marketing at Estee Lauder. As an example, Gonzalez points to the popularity of Lauder’s Self-Action SuperTan Spray, containing fruit acid exfoliants, which sells for $27, compared with the basic Self-Action self-tanning spray that costs $16.50.
She noted: “Customers are willing to pay for quality in a product.”