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Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada 2006 Descending the Corporate Ladder Top 10 Myths.

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Presentation on theme: "Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada 2006 Descending the Corporate Ladder Top 10 Myths."— Presentation transcript:

1 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada 2006 Descending the Corporate Ladder Top 10 Myths Surrounding Aging Baby Boomers & What Boomers Need From Employers

2 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada The State of the Aging Baby Boomer Market – Canada – 2006 Sam Cukierman Managing Partner Strategic Guidance Consulting Inc. Research Sponsors: DeGroote School of Business Verity International Limited

3 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Research for building loyalty to capture this market segment  Survey sample:  1,000 Canadians aged 47 – 64,  Working full-time, (company or self-employed)  Weighted by age, gender, and marital status (to reflect Canadian demographics consistent with 2004 Statistics Canada data).  Survey was conducted in November  Sample accurately reflects the views of the target group, within 3.1 percentage points 19 times out of 20.

4 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Age and Marital Status Age Distribution 26% 37% 25% 12% Marital Status 68% 23% 9% Married Widowed, Divorced, Separated Single Income / Net Worth Household Income 32% 26% 18% 15% 9% <$50,000 $50K - $74K $75K - $99K >$100,000 No Response Net Worth 27% 21% 16% 13% 23% <$100,000 $100K - $249K $250K - $499K >$500,000 No Response Research for building loyalty to capture this market segment

5 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Myth #1 Boomers will retire, find their place in the sun, and live happily ever after

6 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Boomers will retire, find their place in the sun, and live happily ever after Facts:  The word retirement is a misnomer – it is not a point in time – it’s a lifestyle  The lifestyle will engage boomers in work  More than half of Aging Baby Boomers plan to continue working on a part-time basis after they “retire” Myth #1

7 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada At Desired Retirement Age I Will... 8% 52% 18% 22% Continue working on a full- time basis No longer work Not sure / don't know Continue working on a part- time basis By Age 55% 52% 50% By Net Worth 53% 50% 59% <$100,000 $100K - $249K $250K - $499K >$500,000 … Continue Working On Part-Time Basis. Boomers will retire, find their place in the sun, and live happily ever after Myth #1

8 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada At retirement I expect to need... 49% 37% 7% Less monthly income than today About same monthly income as today More monthly income than today Don't Know Boomers will retire, find their place in the sun, and live happily ever after   … and their needs for monthly income will be about the same as they spend today   … to spend money on themselves as a reward for a lifetime of hard work, on travel, on hobbies, on helping their children Myth #1

9 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Boomers will retire, find their place in the sun, and live happily ever after  How many years of retirement income do you think you will require after retirement? This has implications for the social fabric of our society – with great influx of boomers wishing to work, where are the jobs? How will employers respond to meet boomer expectations (realistic or unrealistic)? Net Worth Total<$100K$500K or more Less than 5 years2%3%1% 5-10 years10%15%4% years17%20%15% More than 15 years50%42%64% Don’t know21%20%16% Myth #1

10 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Myth #2 Aging baby boomers are financially prepared for retirement today

11 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Aging baby boomers are financially prepared for retirement today Facts:  They are not financially prepared  85% of aging baby boomers feel only somewhat prepared, not at all prepared, or simply do not know Myth #2

12 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Financial Preparation For Retirement 15% 61% 21% 3% Somewhat prepared Not at all prepared Don't know Very prepared All Those Continuing To Work 32% 29% 39% With your current company With a different company Don't know Self-Employed Continuing To Work 60% 12% 28% Aging baby boomers are financially prepared for retirement today Myth #2

13 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Myth #3 Baby boomers access advice and information and place their trust in one advisor

14 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Baby boomers access advice and information and place their trust in one advisor Facts:  76% of baby boomers have started to “plan” for retirement  They begin with self-help modes of advice – websites, books, friends and family – and find the degree of helpfulness lacking  They progress to more credible professional sources of advice for planning; progression is slow and there is considerable room for growth Myth #3

15 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Which of the following people / resources have you talked to or consulted with regarding your retirement planning? – note HR resource ranks 7th 2% 5% 6% 7% 14% 15% 18% 27% 31% 34% Career counseling firm Real estate agent Lawyer Someone in government Broker Accountant Human resource person at place of employment Financial institution manager / acct. manager Life insurance agent Independent financial planner Books, articles, newspapers Family member / friend / colleague Financial planner with financial institution Baby boomers access advice and information and place their trust in one advisor   Financial planners are the predominant source of advice – financial planners in banks, trusts, and credit unions get highest usage scores Myth #3

16 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Baby boomers access advice and information and place their trust in one advisor   The degree of helpfulness varies among advice providers - among those who have sought professional advice, independent financial planners rank highest in degree of helpfulness   Those who use accountants (only 14%) rank them as high as financial planners for helpfulness Myth #3

17 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Degree of Helpfulness 52% 56% 57% 59% 61% 64% 67% 70% 71% 76% 81% 19% 25% 16% 19% 18% 27% 15% 14% 19% 25% 22% 21% 33% Life Insurance Agent Career Counselling Firm Real Estate Agent Family / friend / colleague Web sites Books / articles / magazines Lawyer Broker Someone in Government F.I. / Account Manager HR & Workplace Accountant Financial Planner with F.I. Independent Financial Planner Extremely Helpful Extremely + Very Helpful Baby boomers access advice and information and place their trust in one advisor Myth #3

18 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Myth #4 The 4 traditional cornerstones for retirement - savings, health, life insurance, and investment plans - are well-covered

19 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada The 4 traditional cornerstones for retirement - savings, health, life insurance, and investment plans - are well-covered Facts:  Life insurance and RRSPs dominate financial holdings  Significant opportunities for growth exist in health, disability and critical care insurance and estate planning Myth #4

20 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada The 4 traditional cornerstones for retirement - savings, health, life insurance, and investment plans - are well-covered Myth #4

21 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Myth #5 Enormous generational wealth transfer through inheritances are occurring or will occur

22 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Facts: Enormous generational wealth transfer through inheritances are occurring or will occur Facts:  Only 11% of aging baby boomers have inherited any kind of assets in the past 5 years  55% of aging baby boomers do not anticipate inheriting any assets in the next 10 years – this holds true even for those aged  26% do anticipate inheriting some wealth bequeathed by an estate, but this will not occur until their very late sixties / early seventies Myth #5

23 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Have you inherited assets from an estate that was bequeathed to you in the past five years? In the next ten years or so, do you anticipate inheriting assets from an estate? 11% 89% Yes No 26% 55% 19% Yes No Don’t Know 19% 29% 32% 35% <$100,000$100K - $249K$250K - $499K>$500,000 By Net Worth Enormous generational wealth transfer through inheritances are occurring or will occur Myth #5

24 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Enormous generational wealth transfer through inheritances are occurring or will occur Does this make sense? Yes because…  They are spending money to help their children financially and will do so for the next 10 years  Only after age 64 do the number of children that are financially independent exceed the number of children receiving financial help  They expect to live well into their eighties, remain mentally and physically active, and be vigorous consumers, believing the monthly income requirements will be at least the same as what they spend today Myth #5

25 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Respondents with children Provide financial help to children 79% 89%76%77%47% Children financially independent 21% 11%24%23%53% ALL By Age Group Enormous generational wealth transfer through inheritances are occurring or will occur Myth #5

26 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Myth #6 Company human resources functions are doing a good job helping future outgoing boomers when they leave their full time jobs

27 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Company human resources functions are doing a good job helping future outgoing boomers when they leave their full time jobs Facts:  Human resource management for career planning and advice is weak – research anecdotes from personal one-on-one interviews backed by quantifiable results  Career management consulting firms can fill the gap if company HR function is unable to fulfill boomer needs Myth #6

28 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Company human resources functions are doing a good job helping future outgoing boomers when they leave their full time jobs What benefits will you be entitled to receive? Health care benefits77% Dental benefits60% Insurance58% Other7% Don't know1% 31% 53% 16% Don’t Know No Yes When you retire, will you be entitled to receive any continued benefits from your existing employer? Myth #6

29 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Company human resources functions are doing a good job helping future outgoing boomers when they leave their full time jobs Importance of Topic in Retirement Planning - Very Important / Somewhat Important Rating- 43% 47% 49% 59% 60% 64% 72% 74% 81% 92% Offering outside consulting / counseling Seeking new career choices after retirement Evaluating personal strengths for new career choices Advice on adjusting to retirement Suggestions for new activities to be involved in Prepare you in event of early retirement Understanding what to expect in retirement Financial counseling Legal matters (wills, power of attorney) Benefits you will be entitled to Myth #6

30 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Myth #7 After retirement, baby boomers will move, downsize their homes, and live out-of-country

31 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada After retirement, baby boomers will move, downsize their homes, and live out-of-country Facts:  Two thirds of aging baby boomers will stay in their current residence  Only 20% of aging baby boomers will live any part of their retirement outside of Canada Myth #7

32 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada After retirement, baby boomers will move, downsize their homes, and live out-of-country <1% 1% 4% 9% 13% 73% United States Somewhere other than Canada or U.S. Different province in Canada Don't know Different city / town /area in same province City / town / area where currently reside Which of the following best describes where your main residence will be when you retire? Plan on Living Any Part of Retirement Outside Canada Yes 20% No 80% - Where ?- Asia, Australia,Other 7% 14% 18% 21% 52% South America Europe Caribbean United States Myth #7

33 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Myth #8 When the boomer works less they will do less

34 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada When the boomer works less they will do less Facts:  Aside from part-time work, caring for physical appearance, exercise, travel, cooking, home renovations, gardening, charity and volunteer work will dominate retirement time  Standard of living, CPP availability, medical and dental affordability are key issues Myth #8

35 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada When the boomer works less they will do less Walking75% 86% 11% Travelling43% 68% 25% Cooking57% 68% 11% Volunteering30% 62% 32% Gardening50% 61% 11% Home renovation / repairs46% 49% 3% Charity work17% 38% 21% Home decoration / décor 28% 34% 6% Photography / art25% 34% 9% Exercise classes 14% 33% 19% Golf21% 32% 11% Wine tasting15% 22% 7% Knitting / sewing18% 21% 3% Sitting on board of directors (paid or unpaid)13% 20% 7% Weight training15% 19% 4% Social club member10% 18% 8% Religious classes / committees /services12%16%4% Social work6%12%6% Running8% 9% 1% Sailing3%6%3% Tennis4% 5% 1% Current Activities - Do / Plan To Do When Retire Currently Do Plan To Do * % Change * includes those who currently do and those who plan to do after they retire. Myth #8

36 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Myth #9 Boomers are not web savvy – their thirst for information will dry up

37 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Boomers are not web savvy – their thirst for information will dry up Facts:  Boomers want a website dedicated to their needs  Three out of every four (74%) aging baby boomers indicated they would definitely / probably be interested in accessing a website specifically geared to serve their needs. This is consistent across all age, income and net worth groupings (Note: This survey was conducted on line. Results of data presented in this section may contain some bias given the respondent’s predisposition to a comfort level with the web). Myth #9

38 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Boomers are not web savvy - their thirst for information will dry up Respondents interested in accessing website (definitely / probably) for... 42% 46% 47% 50% 61% 63% 65% 66% 68% 70% 74% 75% 78% 81% 82% 84% 85% 88% Art and collectibles Recreation products Automobile sales Municipal or other political issues Clothing for sale Automobile service Employment opportunities Hardware products Home renovation / repair services Volunteer opportunities Consumer electronics Financial services Dining recommendations Health and fitness products / services Computer products / services Travel specials Books Hobbies Food preparation / recipe information Food products General newsletter Medical services Entertainment discounts “Top Ten” Myth #9

39 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Myth #10 THE BIGGEST MYTH OF ALL – we’ve identified this group; we’ve got our strategic plans lined up; we’re meeting the aging baby boomers’ needs today

40 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada We’ve identified this group; we’ve got our strategic plans lined up; we’re meeting the aging baby boomers’ needs today Facts:  Everyone wants the business of this “brick-rich / cash rich” group  Few are meeting their expectations today  Opportunity abounds Myth #10

41 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada We’ve identified this group; we’ve got our strategic plans lined up; we’re meeting the aging baby boomers’ needs today ALL RESPONDENTS Above Average Below Average Don't Know Pharmacies 31% 57%8%4% Vacation destinations 27% 54%9%10% Seniors clubs / associations 25% 48%7%20% Book stores /sellers 20% 64%7%9% Specialty magazines / books 20% 60%8%12% Specialty food stores 19% 58%10%13% Restaurants 19% 67%9%4% Doctors 19% 58%20%4% Health / fitness clubs / gyms 18% 53%16%14% Pharmaceutical companies 18% 56%19%7% Travel agents 18% 58%10%14% Hotels 17% 65%9% Ranked in order of “above average” in meeting the needs of aging baby boomers, the following “top 12” businesses, services or professions are shown: Myth #10

42 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada We’ve identified this group; we’ve got our strategic plans lined up; we’re meeting the aging baby boomers’ needs today FINANCIAL SERVICES - ALL RESPONDENTS Above Average Below Average Don't Know Financial planners associated with specific financial institution 16% 57%12%15% Independent financial planning 14% 60%11%15% Banks 14% 59%22%5% Credit unions 13% 53%12%22% Mutual fund companies 12% 57%14%17% Life insurance companies 11% 61%18%10% Financial services industry falls into a middle category among the forty businesses, services, and professions surveyed : Myth #10

43 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada We’ve identified this group; we’ve got our strategic plans lined up; we’re meeting the aging baby boomers’ needs today ALL RESPONDENTS Above Average Below Average Don't Know Gasoline companies3%33% 56% 8% Provincial government4%40% 50% 7% Federal government3%41% 49% 6% Municipal government4%47% 43% 7% Retirement homes15%44% 25% 17% Automobile dealers7%58% 24% 11% Automobile manufacturers8%59% 23% 10% Airlines8%57% 23% 12% Home builders7%57% 23% 14% Banks14%59% 22% 5% The businesses ranked most negatively – the percentage aging baby boomers who believe their needs are met on a “below average” basis : Myth #10

44 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada KEY IMPLICATIONS

45 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Key Implications   Life expectancy and expectancy for what life offers are high – catch the wave   Health conscious and confident – focus on wellness   Spenders – careful, and demanding a value proposition that makes sense   Branding is key – talk to them in their language – keep it simple - deliver messages from respected sources through an attention span that filters what they see, find credible and believable   Ethics will grow in importance

46 Strategic Guidance Consulting Inc. All rights reserved Market Research – The Aging Baby Boomer – Canada Key Implications   Be innovative – create a value proposition on your own, or seek strategic alliances that twin those who are serving boomers well with those who need to break through and profit from this market segment   Case histories: AMEX / insurance; the GAP / Forth and Towne; Vespa / homebuilders; Shoppers Home Health / TEMPUR; Kellogg / Smart Start pedometer; Dove / Mirrors; Proctor and Gamble / make-up selling “hope”; Honda, Lexus, Chrysler   BIG GROWTH: estate planning; health insurance; cooking, specialty foods; wellness; account management cross- sell ratios


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