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Demographics & Trends II MKT 750 Dr. West. Agenda Introduce the concept of cohorts Hear about your customer depth interviews Examine age and cultural.

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Presentation on theme: "Demographics & Trends II MKT 750 Dr. West. Agenda Introduce the concept of cohorts Hear about your customer depth interviews Examine age and cultural."— Presentation transcript:

1 Demographics & Trends II MKT 750 Dr. West

2 Agenda Introduce the concept of cohorts Hear about your customer depth interviews Examine age and cultural cohorts Your team research proposal is due on Friday and remember to sign up for team meetings

3 Generational Influences: Life Cohort Current Stage Experiences Conditions Values Preferences Marketplace Behaviors

4 US Population Break Down Values in Millions

5 Post War: Demographics Age: 57+ (born before 1946) Education: 36% high school, 12% college, 9% post-grad Marital status: Married & had children earlier than any other generation Income: Large difference between retired and not retired

6 Post War: Attitudes Core values: Traditional, patriotic, family, risk-averse Motivators/goals: Security & stability Want a better life for their kids Spending/saving habits: “Save some, spend some” Started retirement saving at age 43

7 Post War: Lifestyle Growing up: TV introduced during 40’s & 50’s Nat King Cole, Frank Sinatra, “I Love Lucy” Preoccupied with family Current: Healthy & active Travel, gardening, charitable activities Grandchildren, pets, sweepstakes

8 Post War: Interesting Facts Never been a president from this group Produced 60’s activists: Ralph Nader Gloria Steinem Malcolm X Martin Luther King Don’t like to have their age pointed out

9 Post War: Brand Relationships Brand loyal Sensitive to age-specific advertising Do not like surprises, want gradual change Very patriotic!

10 Post War: Segments Today’s Mature Consumer: Autonomy: Want to lead active lives and be self-sufficient Connectedness: Value bonds with friends and family (Computer savvy) Altruism: Want to give something back Personal growth: Very interested in trying new experiences and developing their potential

11 Effective Marketing Examples Celebrex

12 Boomers: Demographics Size: 78 million Boomers I: (1946-1955) Age 47 – 56 Boomers II: (1956–1965) Ages 37 - 46

13 Boomers: Customer Profile Experiences Dr. Spock Leave it to Beaver Economic good times

14 Boomers: Lifestyle Segments Upbeat Enjoyers Feel good=look good Volunteers Insecures Finance worries Spend only on themselves

15 Boomers: Lifestyle Segments Threatened Actives Don’t believe in retirement/reject retirement homes Opposed to re-taking drivers tests Financial Positives Consider themselves successful Not satisfied with their looks

16 Boomers: Values Individualism “Me Generation” Financial Positives, Insecures Indulgence Cosmetic Changes, Love to Make Love Stimulation Fitness Getaways/Active Vacations Question Nature Mainstreaming of health foods

17 Boomers: Market Needs Want more information Question authority of all kinds Doctors Government Corporations Education System

18 Boomers: Market Needs Prize holding on to their youth Vanishing Generation Gap Increase in agreement between Boomers and their children vs. the Boomers and their Parents Attitudes toward sex (61-86%) Young people less responsible (51-70%) Less respect for parents (69-77%) Harry Potter phenomenon

19 Boomers: Market Needs Prize Holding on to Youth Fitness Revolution Low Impact, want to enjoy their exercise 7% increase in home exercise equipment purchases since 1999 Vitamins, herbal remedies, fitness h2o Bio Chemistry Dye gray (men and women) Anti-age creams Tummy tuck, eye lift, brow botoxed

20 Boomers: Viagra Relevance to market Market has grown with them Always into sex and drugs Disregard for social norms in reference to sex


22 Born: (1966–1976) 26-36 years old Approximately 40 million Americans Outnumbered by both the Boomers and Generation Y Generation X: Demographics

23 Diverse group, difficult to categorize Children of divorce/latchkey Skeptical of relationships Work to live, not live to work Marrying later, but having sex earlier Rely on their friends for love and acceptance Generation X: Profile

24 Adrenaline junkies Extreme sports Embrace technology Well-educated 29% have bachelors or graduate degrees Do not trust government and institutions Lowest voting rate in history Prefer to make a difference locally, if at all Generation X: Lifestyle

25 Remember that they prefer honesty Treat them as important Use technology Be comfortable with diversity Example: Saturn Generation X: Marketing


27 Gen Y: Demographics Echo Boomers… Consists of US Children, Adolescents, and Young Adults Ages 9-26 Born Between 1977-1994 56 Million in the Cohort Fastest Growing Demographic group under age of 65 64% of Gen Y Group is in Primary Education

28 Gen Y: Purchasing Power Purchasing Power Differs by Age Sub- Group Children (9-11) Teenagers (12-17) Adults (18-24)

29 Gen Y: Attitudes Attitudes shaped by world events and socioeconomic trends High percentage of single parent homes Children involved in earning/spending decisions World events brought reality of tragedy closer to home Columbine, September 11 th, Oklahoma City Tumbling Icons OJ Simpson, President Clinton

30 Gen Y: Resulting Values Resulting values from world events and trends Conservative (more than parents) Desire to have a family and a good job Fiscally responsible Open to using financing to achieve goals

31 Gen Y: Interests & Activities Internet Two thirds of children under age 11 used a computer before age five 80% of teenagers have internet access Computer Games Approximately 40% of 145 million US video game players are under the age of 18 Mobile Communications Almost 20 percent of U.S. teenagers own a wireless phone

32 Gen Y: Marketing Trends Brand image is a necessity to compete Internet marketing is essential Integrated sponsorship and promotion Subtle use of celebrities Increased use of humor

33 Gen Y Marketing Example 7 UP Example

34 Attention to Diversity Hispanics African Americans

35 Hispanic Americans

36 Hispanic: Definition People who live in the U.S. and who were born in, or their families came from, one of the Spanish speaking Latin American countries or from Spain Are an ethnic group, NOT a race because Hispanics belong to all human races

37 Hispanic: Demographics Fastest growing population - 35.3M or 13% Age: 35.7% under 18 years old Households: 30.6% consist of 5 or more people vs. 11.8% Whites

38 Hispanic: Demographics Bilingual households more common than English only households Education: 66% graduate from high school Income: 38% earn $40,000 per year Difference in education and income are not uncommon for immigrant groups

39 Where Hispanics Live KS 7% CA 32% AZ 25% TX 32% NM 42% NY 15% FL 17% “Traditional” Hispanic States “New” Hispanic States: 2000 Census CO 17% MA 7% CT 9% NJ 13% WA 8% OK 5% WI 4% IL 12% “Future” Hispanic States: 5-10 years

40 Hispanic: Values Collectivism Emphasizes needs, objectives, and points of view of an in-group Familismo Strong identification with and attachment to family

41 Hispanic: Values Machismo Men are viewed as providers, protectors, and representatives of the family Simpatía Behave with dignity and respect toward others

42 Hispanics: Marketing Hispanic market cannot be treated like the general market Different language preferences Unique acculturation levels Distinct cultural values

43 Target based on country of origin Example: baseball vs. soccer Avoid stereotypes Example: Mexican wearing sombrero Leverage language Market to Hispanic youth in both English and Spanish Hispanics: Marketing

44 Marketing Example

45 Marketing Examples Play Video


47 America’s second largest minority Over 36 million 12.7% of the U.S. population Huge purchasing power $601 billion in earned income $572 billion in purchases African American: Demographics

48 African American: Trends From 1990 to 2001, rate of increase in spending power was 81% faster than for whites The number of African-American-owned businesses grew by 46% from 1987 to 1997 Half the African American population is middle class and above

49 Psychographics Lack of trust of the government Strong family unit Religious base Work harder to get to level field Want R-E-S-P-E-C-T

50 Buying Habits Spend 2 out of 3 dollars of all minorities Represent: 25% of movie going audience 30% of active footwear market 31% of volume for some soft drink brands Homes, cars, food

51 Marketing Efforts Hallmark Cards Introduced a line of 16 greeting cards called Mahogany in 1987. Today it features more than 800 cards. Keys to success: Employing African-American artists and writers Featuring culturally relevant art and poetry Establishing close relationships with respected artists and authors Talking to consumers to develop designs and messages that depict the African-American lifestyle

52 Cultural Influence Cultural Value System Symbols/ Language Heroes/ Lifestyles/ Influencers Customs

53 Human Universals Norms of reciprocity and hospitality The protection and training of children, caring for the sick Incest taboos and modesty, family units Social hierarchy, idiomatic language … However, there is significant variation in how these are expressed across cultures

54 Sensitivity to Culture Consumers choose products to meet needs What gives rise to needs & wants? View of the self & relationship to others Worldview (e.g. Russian consumers and credit) Preferences (e.g. eggs for breakfast) Lifestyles (e.g. dishwashers in Japan) Rituals & Customs (e.g. laundry detergent in Peru)

55 Sensitivity to Culture Nestlé condensed milk is used and marketed differently around the world. England – it is a cake or fruit topping Germany – used as a coffee creamer Australia – for homemade ice cream Mexico – as baby food

56 Sensitivity to Culture Should everyone use deodorant? 89% of Americans say - YES! 59% of French consumers think so. Only 53% of Australians feel the need.

57 Sensitivity to Culture Cultures differ in potentially significant ways Hofstede identified four distinct dimensions for characterizing cultural differences: Individualism versus Collectivism: the extent to which the welfare of the individual or the group is valued

58 Individualism Collectivism (e.g. US, Australia, Canada) (e.g. Hong Kong, Taiwan, Japan) Self-construal Role of Others Values Motivational drives Behavior Self-construal Role of Others Values Motivational drives Behavior Defined by internal attributes and traits Self-evaluation (standards of social comparison) Emphasis on separateness Focus on differentiation, need for uniqueness Reflective of personal preferences Defined by internal attributes and traits Self-evaluation (standards of social comparison) Emphasis on separateness Focus on differentiation, need for uniqueness Reflective of personal preferences Defined by important others, family, and friends Self-definition (relationships with others define self) Emphasis on connectedness Focus on similarity, relatively greater need to fit in Influenced by preferences and needs of close others Defined by important others, family, and friends Self-definition (relationships with others define self) Emphasis on connectedness Focus on similarity, relatively greater need to fit in Influenced by preferences and needs of close others

59 Sensitivity to Culture Phillip Morris successfully marketed its Marlboro brand in Hong Kong not by pitching the “Marlboro Man” but by citing the brand’s dominant share in the US.

60 Sensitivity to Culture Power distance: societal acceptance of inequality in power, which can affect how relationships are are formed. High Power Distance societies (e.g. Russia, China, India) believe in a well-defined order/place in society Low Power Distance societies (e.g. Germany & US) emphasize equal rights and the opportunity for advancement

61 Sensitivity to Culture Uncertainty Avoidance: the degree to which people feel threatened by ambiguous situations and have well-defined rules and rituals to to deal with perceived threats Religion plays an important role Masculinity - femininity: Sex role delineation

62 How much should you adapt? Going global Some products are marketed the same virtually everywhere (e.g. Coca~Cola) Others are adapted to local conditions (e.g. McDonald’s) What’s a manager to do?

63 How much should you adapt? Consider the following: Is my product “culturally bound”? Food (dairy in South America) Personal care (cosmetics) Ritual or convention based (laundry & credit) High tech & luxury products are similar across cultures

64 How much should you adapt? Consider the following: How does the product distribution fit within cultural norms Amay and Avon in Japan, Some segments are similar in wants & needs Teens, luxury & status goods How will “American” sell? Use local sources of information on trends and tastes

65 Think globally, act locally!

66 Marketing Blunders Coors translated its slogan, “Turn it loose,” into Spanish, where it read “Suffer from diarrhea” Pepsi’s “Come alive with the Pepsi Generation” translated into “Pepsi brings your ancestors back from the grave,” in Chinese In Italy, a campaign for Schweppes Tonic Water translated the name into “Schweppes Toilet Water”

67 Appreciating Differences Getting to know your customer requires: Understanding their past and what they value Being aware of social and cultural norms Not making assumptions that others think the same way that you do. Beware of stereotyping

68 Assignment Read Chapters 3,4 & 6 Be sure to sign up for a team meeting! Memo 2 Begin working on shopping diary entries over the weekend Compare your purchase decisions with the book description of the decision making process

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