Case study 1: Marketing Research Reveals Marketing Opportunities in the Baby Boomer Generation
For many years. marketers have focused upon consumers between the ages of 18 and 34 to promote products. Marketers feel that wooing consumers early in life will ensure that they become lifetime loyal customers. While this seems logical. research is revealing that Baby Boomers might be a more profitable demographic. Statistics show that although spend¬ing for Millennia's is actually shrinking, Baby Boomer spending has been increasing. Baby Boomers are estimated to have $3.4 trillion in annual buying power.
The Baby Boomer generation is vastly different from the generations preceding it. Baby Boomers desire to have a vari¬ety of products available to them. Many of the products tra¬ditionally thought to belong to the younger generation, such as cars and technical products. are actually bought the most by older generations. With approximately 20 percent of the U.S. population estimated to he 65 years or older by 2030. marketers are beginning to research better ways for market¬ing to Baby Boomers.
In one study researchers attempted to understand hove older consumers shop and interact in stores. Because ,tore marketers often target younger generations of consumers, little thought has been given to how accessible these stores are for older generations. The research design invohed equipping a person with gloves, neck braces, helmets, bluiry, goggles, and other equipment to simulate how a person in his or her 70s with arthritis is feeling. Researchers would then observe how the person takes items off of shelves, gets into his or her car. and gets up from chairs.
This research has been shared with many businesses that have interpreted the findings to create a retail environment better suited to this demographic. CVS. for instance, has low. ered its shelves, made its store lighting softer, and installed magnifying glasses for hard-to-read labels. Other busi-nesses are using this information to redesign their products. Diamond Foods Inc.. for example, has designed the packag-ing of its Emerald snack nuts to be easier to open, a area, help liar older consumers whose hands become less mobile as they age. The company also studied consumers with arthritis and decreased the time it takes to rotate the caps to open its products.
Additionally. Baby Boomers have created an opportunity for businesses to market entirely new products. Baby Boomers tend to embrace fitness and exercise regimens as a way to stay fit and prolong their lives. Technology firms are seeing an opportunity to develop products to be installed in the homes of older consumers. These products monitor the movements of the inhabitants and alert thmily or experts if there are any changes in the inhabitants' movements. A decrease in mobil¬ity could signal a change in the person's physical and mental state, which may require medical attention. Although these devices might otherwise seem intrusive, Baby Boomers' desires to stay healthy and prolong life are increasing their demand. Many Baby Boomers are also concerned with pre¬serving their more youthful appearance. Lingerie maker Maidenform has created shapewear, or clothes that help to lone" the body, targeted toward those ages 35 to 54.
There is one description that marketers must avoid when marketing to Baby Boomers: any words or phrases that make them feel old. Marketing research has revealed that Baby Boomers do not like to be reminded that they are aging. Therefore. many marketing initiatives aimed at older consumers must he subtle. For this reason, Diamond Foods does not market the fact that its packages arc easier to open because it does not want to make Baby Boomers feel aged.
Even marketers of products that are for older people have overhauled their promotional campaigns to focus less on the concept of aging.
Kimberly-Clark's Depend brand for incon tinence was widely regarded as "adult diapers." This negative connotation led many to avoid them. To try to counteract this view. Kimberly-Clark released commercials that discussed the benefits of the product but also tried to "de-myth" the brand by discussing its similarity in look and feel to underwear. Many other businesses that sell similar products are following suit.
Although marketers have long focused on Millennials. the demand for products by Baby Boomers is changing the ways that businesses market to consumers. Marketing research is key to understanding the Baby Boomer demographic and cre¬ating the goods and services that best meet their needs.53
Questions for Discussion
1. Why are Baby Boomers such a lucrative market?
2. How has the marketing research process been used -to understand how Baby Boomers shop and interact in stores?
3. How have stores used marketing research findings to tai¬lor their stores and products to appeal to Baby Boomers?
Case study 2. Family-Owned Ski Butternut Targets Family Skiers
Located ift the picturesque Berkshire Mountains of Western. Massachusetts, Ski Butternut has been a family-owned, family-oriented ski destination for mom than 50 years, The resort includes 22 trails for downhill skiing and snowboarding, two terrain parks for riding, and a dedicated area for snow tubing. Although Ski Butternut hosts some non-ski events during summer and fall. its business goes into high gear when snowy weather arrives, bringing skiers and riders from across Massachusetts. Connecticut, New York, and New Jersey.
Matt Sawyer. Ski Butternut's director of marketing.. says the primary target market has always been families with toting children who are seeking affonhtble skiing. Everything (mm the snack-bar menus to the ski-shop merchandise is presented with families in mind. So that parents can have fun in the snow t about worry. the resort has a Children's Center for children who are too young to ski or haw no interest. l'ifth-graders are invited to ski for free when accompanied by an adult who buys an adult lift ticket. The resort also created two terrain parks tbr young snowboanlers who were clamoring fora more exciting riding experience. Without the terrain parks, Sawyer says. these boarders would have asked their parents to take them to competing mountains in Vermont, Ski Butternut's research findings show that first-timers are a particularly important segment. because they tend to have a strong allegiance to the resort where they learn to ski. First-timers typically visit the resort sewn times before seeking out more challenging mountains. As a result, Ski Butternut has made teaching first-timers to ski or snowboard one of its specialties. For this market, the resort bundles ski or board rentals. lift tickets, and also offers a wide range of individual and group lessons for all ages and abilities at a value price. Because Ski Butternut has trails for different skill levels. beginners can challenge themselves by changing trails within the resort once they feel confident.
Ski Butternut also targets seniors and college students. Knowing that weekends are the busiest period, the resort offers special midweek prices to attract seniors who have free time to ski on weekdays. College students are particu-larly value-conscious. and they often travel to ski resorts as a group. As a result. Ski Butternut offers weekend and holiday discounts to bring in large numbers of students who would otherwise ski elsewhere. Thanks to Facebook. Twitter, and other social media. students quickly spread the word about special pricing, which enhances Ski Butternut's ability to reach this key segment. In addition, the resort highlights dis¬count pricing for families when targeting specific segments, such as scout troops, military personnel, emergency services personnel, and members of local ski clubs.
Sawyer conducts up to 1,200 customer surveys every year to better understand who his customers are and what they need. He also compares the results with skiers who visit mountains of a similar site in other areas. Digging deeper, he analyzes data drawn from the ski shop's rental business to build a detailed picture of customers' demographics, andi. ties, and preferences. Based on this findings, he knows that the typical family at Ski Butternut consists of two children -under age 18 who ski or ride, and at least one parent who skis.
Because they can obtain so much information from and about their customers, Sawyer and his team are able to make, better decisions about the marketing mix for each segment. By better matching the media with the audience, they get a better response from advertising, e-mail messages. and other marketing communications. As one example, they found that 15 percent of the visitors to Ski Butternut's .website were using a smartphone to access the site. Sawyer has now ere¬ated a special version of the site specifically for mobile use and created a text-message contest to engage skiers who have • smartphones.'s
Questions for Discussion
I. Of the four categories of variables, which one seems to be the most central to Ski Butternut's segmentation strategy. and why?
2. How is Ski Butternut applying behavioristic variables is its segmentation strategy? Explain your answer.
3. What role do geographic variables play in Ski Butternut's segmentation and targeting?
Discussion1 ( 200 words)
You have just developed a GPS unit that can be worn on a necklace, wristband or belt. The unit is designed to aid in locating missing children, individuals with dementia, or those who are developmentally disabled. Who your target audience(s) are and what approach will you use with them.
Discussion2 ( 200 words)
Duluth Trading Company Ads
COLLAPSE
The Duluth Trading Company began in 1989 with the creation of a work belt for carpenters and "handy" men (and now women). It has since expanded into clothing and a focus on underwear and work clothes. A new series of attention grabbing ads has been released this year bringing more visibility to the company.
Watch the ads - both those aimed at men and at women - featured on the page linked below (copy and paste into your browser).
Discuss how effective this advertising campaign is to today's audience.
What segment of the market is Duluth targeting?
Do you think this ad campaign will be effective for that segment?
Would this same ad campaign work in another country such as Saudi Arabia, Korea or China? Why or why not?
https://www.youtube.com/user/DuluthTrading