Over 50 and Entrepreneurial
Christiane Northrup M.D. has a new book for us to enjoy, Goddesses Never Age, and she delivered an engaging talk on public television about how to maintain vitality and radiant health with each passing year. Dr. Northrup’s information appeals to a wide audience, as even the youngest of the Baby Boom generation are eligible to join AARP. But as a member of Generation X, I had to pause and rewind the part where she quoted an opinion piece from Robert Love, editor-in-chief of the AARP Magazine:
“The Smart Money is on the 50+ Crowd…. We the people over the age of 50 are 100 million strong. We will soon control more than 70 per cent of the disposable income in this country. We buy two-thirds of all the new cars, half of all the computers and a third of all movie tickets. We spend $7 billion a year shopping online. Travel? More than 80 per cent of all the premium-travel dollars flow from our credit cards.”
Mr. Love’s piece laments the fact that advertisers focus their attention exclusively on the 18-to-49-year-olds, when in fact, the consumer purchasing power is disproportionately held by those over age fifty. It is a valid point, but I wish that Dr. Northrup had chosen another example. Those over age fifty are not just powerful as consumers, they are powerful as producers. A 2013 Gallup poll found that 73 per cent of Baby Boomers expect to continue working well past the age when they will become eligible to collect Social Security benefits: 41 per cent by choice and 32 per cent by economic necessity. Increasingly those boomers are starting their own businesses. The Ewing Marion Kauffman Foundation found that nearly one-quarter of those starting their first businesses are age 55 or older, a proportion that has nearly doubled over the past twenty years. For that reason, the AARP has partnered with the Kauffman Foundation to offer entrepreneurial training workshops for those age 50 and older starting their own businesses.
And that is why the largest advocacy group in the U.S. for those age 50 and older is no longer known as the “American Association of Retired Persons”, but as AARP, because many of the members are not retired. And that brings us back to the choices advertisers make. Their focus on the 18-to-49-year-old demographic does not result from a lack of appreciation of the spending power of the 50+ crowd. Rather, they focus their advertising efforts on younger adults because they believe older adults have already cemented brand loyalty and are less likely to change their purchasing preferences based on a snappy commercial. And that is where they are missing the point.
I notice this all the time when I speak at small business conferences. Invariably, people (okay, mostly women) come up to me with questions, like “What type of computer should I purchase for my business?” or “What are the best products for cyber-security so I can be sure my business information remains safe?” These people usually appear to me to be over the age of fifty and they are clearly open to brand suggestions, because they have no fixed preferences or brand loyalty. Notwithstanding their years of work experience, people who spent their entire careers in large companies working for someone else had purchasing decisions made for them for business use. The IT department decided which brand computer they would use at their place of work. The procurement department selects the corporate credit card, and so forth. The employees generally don’t know why these decisions were made or appreciate the selection criteria for purchases.
Once they leave their employers and start their own businesses, they need advice and guidance. The performance criteria for business and personal use computers are very different. The credit card you use for your personal spending is likely not the right choice for your business account. That is why I find so many people age fifty and over approaching me at small business conferences seeking product advice. I wish Dr. Northrup and AARP would use that example to illustrate why advertisers should pay attention to older people. The image of people over age fifty using their years of experience to bring their entrepreneurial dreams to life is a much more positive image of healthy aging than self-indulgent boomers overspending on credit cards. (And it also illustrates why we need to increase our focus on small business disaster resilience. Lack of preparedness is risky for any entrepreneur, but particularly those who have more to lose and less time to play catch up.)