BoomerMarketingMainstay of the Travel Industry

Presented by Warren Sukernek to the Seattle Direct Marketing Association – October 2006

Travel Market Reality

• Today there are 78M boomers

• 10,000 people join the 50+ market

each day

• Bread and butter of the travel

industry

• 50+ market buys 80% of luxury travel

Boomers Are The Growth

Opportunity• By 2010, the 35-44 year-old group will decline by 2.5 million people and

the 45-59 year-old group will grow by 4.5 million people!

– Just beyond Boomers—those 60-64—will grow by 3.7 million.

Total

US

<14 15-

19

20-

24

25-

29

30-

34

35-

39

40-

44

45-

49

50-

54

55-

59

60-

64

65-

69

70+

Population Change by Selected Age Groups 2005-2010

4.5%1.8% 0.8%

4.1%

8.2%

2.1%0.9%

11.0%12.4%

28.1%

20.2%

5.6%

-3.5%-7.7%-10%

-5%

0%

5%

10%

15%

20%

25%

30%In 2010, there

will be 6% fewer 35-44 year-olds

than in 2005

2000 – 2020 Trends

• 55 – 64 year olds +72% growth

• 65+ 54% growth in population

• 25 – 44 decline of 8% (4.3M)

Percentage of Boomers in 50+ Population

67%

2010

2000

22%

2005

44%

Source: U.S. Bureau of the Census, 2004

Boomers in PerspectiveThey’re a Huge Market!

• ―Boomerland‖ is the 15th largest world population –78 million people

– A population larger than England, Italy or France

• Largest population segment in the U.S.

• Estimated to spend up to $2 Trillion annually

• Makes them the 11th largest world economy

– Spending larger than GDP of Mexico or Canada

They’re Powerful!

• Ikes/WWII—51 million

• Gen X—57 million

• Gen Y—76 million

They’re Dominant!

Lifestage

Affluence

Demographics

Health

Market

Behavior

Age/

CohortValues

Mature consumers are complex

Thrifty, Patriotic,

Sacrificing,

Defer

Gratification

Boomer Influences: Formative Years

Political/

Social

Formative

Years1930 to 1945 1974 to 19831967 to 19771960 to 19701946 to 1963

Prohibition,

Social Security,

FDR/ New Deal,

Bread Lines,

WWII, Labor

Movement

McCarthyism,Cold

War, Brown vs.

Board, Highways &

Suburbanization,

Korea

JFK, LBJ, MLK,

Civil Rights, Viet

Nam, Woodstock,

Kent State, Draft

Lottery

Viet Nam, ERA,

Watergate,

Roe vs. Wade,

No Fault Divorce,

Casual Sex

Hostage Crisis,

Reagan, Terrorism,

Middle East Conflict,

Rise of Conservatism

Economic Stock Market Crash,

Great Depression,

Keynsian Econ

G.I. Bills,

Housing Act,

Prosperity

New Frontier,

Medicare, Great

Society

Price Controls,

Nixonomics,

Inflation

Oil Shocks,

Reaganomics,

Stagflation

Popular

Culture

Chaplin, Babe

Ruth, Radio,

“Talkies”,

F Scott Fitzgerald,

Movies, Lindbergh,

No TV

Sinatra, James

Dean, Elvis, M.

Monroe, Disney,

Hot Rods, Duck &

Cover, Sputnik,

Family TV

The Beatles, Dylan,

Rolling Stone

Magazine, Moon

Walk, The Pill,

Psychedelic Drugs,

News TV

Saturday Night

Live, All in the

Family, Mary Tyler

Moore, Ms

.Magazine,

Counterculture TV

Star Wars, Disco,

Fitness Craze, Punk

Rock, Space

Shuttle, Crack and

Drugs,

Crime & Violence

TV

Core Traits Idealistic, Demanding,

Nonconformist, Seek

Immediate

Gratification

Pragmatic,

Apolitical, More

Conservative,

Fade to GenX

Status Quo,

“Don’t Rock the

Boat” Respect

Authority

Status conscious,

Individualistic,

Seek Immediate

Gratification

WWII IkesLeading

Boomers

Middle

Boomers

Trailing

Boomers

Purchases

Occupation

Values are the “traffic cop” of behavior

Hobbies

Lifestage

Affluence

Demographics

Health

Age/

CohortValues

The Values Philosophy

Members of any generation are linked by the shared life experiences of their formative

years.

It is not the experiences and events

themselves that have meaning . . .

The beliefs and core values that are created as a result of these events are

important.

Why Values?Values provide powerful explanations of

consumer behavior:

• Serve as standards of conduct

• Tend to be limited in number

• Remarkably stable over time

-0.042

-0.019

-0.019

0.000

0.010

0.033

0.065

0.391

-0.20 -0.15 -0.10 -0.05 0.00 0.05 0.10 0.15 0.20 0.25 0.30 0.35 0.40

Home Entertainment

Investors

Techno-Geeks

Do-it-Yourselfers

Field and Stream

Home and Hearth

Athletics

High Culture

Mean Factor Score

Cruise Line Customer

Affinities - Destination Asia

Gender

• While gender differences in terms of processing

information are huge in younger cohorts, as people

age, the male approach to information processing

actually moves toward the more intuitive, that is,

more “female” in the way they approach information

and ideas.

• When marketing to consumers 50+, messaging for a

female consumer has broader appeal to male

consumers.

PrimeTime Women

› 80% of all spending in U.S. households

› 94% of home furnishings

› 89% of vacations

› 88% of kitchen appliances

› 75% of new homes

› 80% of healthcare spending

› 66% of personal computers

› 55% of consumer electronics

› 60% of new cars/80% of all car sales

› 80% of home improvement projects

› 50% of the private wealth

› 75% of household finances

Women control:

Boomer Insight

• Boomers are not planning to retire the way Matures did in their 60’s.

– They will work in flexible arrangements, start their own businesses, and volunteer in unprecedented numbers

– Matures are the largest segment of leisure travelers.

– Boomers will take shorter trips, with more frequency because of work and caregiving commitments.

– Grandtripping is a growing trend.

– Traditional cruising will have to shift from Mature values to Boomer values.

– International travel is still tentative for every segment.

– Boomer international travel is often experientially driven; cooking vacations, wineries, genealogy, exploration.

WesternCanadaMexicoCaribbean

14%

18%

11%9%

7%

19%

24%

31%

25%

4%3%3%

4%4%

14%15%

29%

23%

2%4%

5%6%

8%10%

20%

23%

31%

34%

26%26%

Eastern

Europe

AlaskaSouth

America

Central

America

AsiaHawaiiWestern

Europe

CanadaMexicoCaribbean

International Destinations

• The most common international traveldestinations are close by—the Caribbean,Mexico, Canada and Western Europe.– The Matures are exploring the widest array of

destinations.

Q.17: Which international destinations have you traveled to in the past three years for vacation?

Among Those Who Travel Internationally For

Leisure

Ge

n X

ers

Bo

om

ers

Ma

ture

s

Conclusions

• The Me generation– I’m special

– I deserve it

– Health conscious

• Experiential– Local culture

– More volunteerism

– Adventure travel

– Extended family travel

– Mastery travel