Sunday, February 27, 2011

Mega trends that affect the 50-plus


It is easy to get distracted by the deluge of news and research about the 50-plus that results in you missing the big picture developments that will shape their retirements.

Firstly, research from the US that illustrates how only consumers in the top 20% have experienced any real increase in their incomes over the past years. Just look how well those in the top 1% of income have done. The fragmentation of consumers into rich and ‘poor’ is another factor affecting the fragmentation of older people into the haves and the have-nothings.

Secondly, the increasing discrepancy in the pension provisions of those employed in the public and private sector.

Having just spent a couple of weeks in the US I am aware of the ‘debate’, if that is the right word, going on about the need to reduce the difference between public and private conditions of employment. Understandably, those in the public sector want to hold onto and extend what they have, those in the private sector look on enviously and get increasingly frustrated as their conditions of employment (and retirement) are eroded.

I have just been reading a paper that was produced in 2009 by PwC called The Tortoise and the Hare, a modern fable. This looked at the financial outcomes for two individuals of similar background and job type. One was employed by the government (the tortoise) the other in the private sector (the hare). Look at the results - a  bit of a difference in the post retirement spending expectations.

Let’s put our marketing hats on for a minute. The positive take from this analysis is that retired public sector employees are becoming an important market sector – certainly in terms of their spending power.

I think we have reached a point where retired public sector employees are worthy of being targeted - how you do that is another thing. Anybody like to suggest what lifestyle characteristics result from a lifetime spent in the employment of the Government? Dick Stroud

3 comments:

Clive Colledge said...

After spending 30 years working in private industry (advertising, design and marketing)that included running companies, I have spent the last 12
years working at a university. I'm therefore well aware of the difference between my own 30 years worth of private pension entitlement and that of some of my colleagues who have spent 30 to 40 years building an academic pension. The tortoise and the hare in your chart is a perfect analogy.

As for how those with lifetime public pensions should be targeted, I suggest that they have the same desires and lifestyle aspirations as those with 30 + years of private pensions. The only difference is that many of them have the financial choice to retire and some of those with private pensions don't have that choice.

As you have said many times before though you can't put all older people into one lifestyle category. Some of those who can afford to retire will want to live in the sun, some to travel, others to garden, write, paint, climb, cycle etc. Some will want to start their own business. If my colleagues are an example I don't think people with a lifetime of public service have a different set of lifestyle characteristics to the rest of us.

Dick Stroud said...

Clive - thanks for your comment. And of course you are right that public sector workers come in all shapes and sizes like those in the private sector. However, there might be some ways of targeting the content they consume. Not as mass but by the type of work they did (i.e. You as a somebody working in the university education sector are more likely to read certain journals/magazines - what they are I have no idea. I am sure that a media agency could optimise a content strategy to hit public rather than private sector workers. It sounds like a great doctorate project!

Clive Colledge said...

Thanks Dick. I agree that a content strategy could be created to hit particular groups such as retired university tutors or those that stay on after 65. In response to your thought that it could be a doctoral project, I am presently completing a doctorate on the match between the values of older UK baby boomers and the values communicated to them through UK advertising, in which your book is sited. I think your idea of developing a content strategy to older or retired public sector workers is worth a PhD or post doctoral research.