Rock ‘N’ Roll Retirement

  Watching television can tell you things about your parents that you may not have known.  The same is true about flipping through a magazine.  What you discover may surprise you when you begin paying close attention to the advertisements geared toward them and their generation.

  As baby boomers across the country reach retirement age, major American companies have been forced to rethink their marketing strategies, and redesign them to appeal to a different kind of retiree.  You have probably noticed it in the Fidelity Investments commercials, with the lava-lamp bubbles touting their 401k benefits and offering ideas for getting the most of you IRA, as Iron Butterfly’s “In-A-Gadda-DaVida” wails in the background.  The same company has also commissioned the use of Terry Jacks’ “Seasons In The Sun” for an ad, while Ameriprise Financial has hired Dennis Hopper, Mr. Easy Rider, to peddle their financial planning to former flower children.

  It feels strange to see the anthems and icons of the Sixties and Seventies being used to sell annuities and retirement planning.  But while it may seem to go against the very spirit of the music and the generation that produced it, we have to assume, on the evidence of its continued existence, that it must be working.

  Baby boomers are defined as the generation born between 1946 and 1964, conceived in the postwar reunions of soldiers returning home from World War II and Korea to their wives.  As a generation, they are known as free spirits—the children of the Sixties and Seventies who questioned authority, fought for civil rights, protested the war in Vietnam, and brought about the sexual revolution.  Of course these are generalizations, but they are strong ones, and are not without merit.  They have been used to characterize baby boomers since the McGovern campaign and, for better or worse, will live on as the legacy of their generation.

  It’s no mystery why advertisers are trying to get into the wallets of America’s largest demographic.  They are also the richest.  Historically, the 18-49 age group has been the sweet spot, if you will—the group with the largest disposable income.  But now, the nation’s 75 million baby boomers hold reign as the country’s most affluent segment.  They hold more than 75% of the country’s financial assets, and have an estimated $1 trillion of disposable income annually.  In essence, their spending power is simply too powerful for advertisers to ignore.

  Until recently, only about 10 percent of advertising dollars were spent on ads targeting the over-50 group.  And while that is starting to climb a little, it still isn’t anywhere near the levels that would be proportionate to the baby boomers’ spending power.

  The perception among advertisers is that boomers will redefine retirement.  Boomers will not go gently into their golden years; they will be more active, more adventurous, more independent, and generally just younger than previous generations of retirement age.

  Which means you can expect to see more Centrum commercials blaring Pink Floyd, more Cadillac ads rocking the Stones, and McCartney selling off his share of the Beatles’ catalog to be used in Titleist commercials.  Oh, and when that time comes, be on the lookout for more Rock and Roll retirement communities.  Mark my words.

-From Pulse
   March 29, 2007