Dear Members:

Happy New Year! Yes, the holidays came and went and now we're entering a brand new year; a year we hope will be one of peace and prosperity.

I thought it would be valuable to start 2004 with an assessment of a very important group of customers and patients, the Mature Market - not just Baby Boomers, though they comprise a key segment of the group, but the "Over 45" category as a whole.

By 2010, the Census Bureau estimates, roughly half of the country's population will be older than 40. Right now, about four million people a year are turning 50, a trend that will continue for years. In addition, the country has more than 40 million Americans who are already 65 or older. In contrast, the 18 to 34 year old population is shrinking.

Who are these older Americans? According to Mature Marketing and Research, a Boston-based research company, these are the most affluent residents in our country. The company's studies found that Americans aged 46 and older control more than half of the nation's discretionary income and own more than three-quarters of the country's financial wealth.

According to an interesting book entitled, Marketing to the Mindset of Boomers and Their Elders, by Carol M. Morgan and Doran J. Levy, households headed by someone 40 or older hold 91 percent of America's net worth. The mature market, the authors say, "is the dominant market in the U.S. economy, making the majority of expenditures in virtually every category."

Another valuable book, After Fifty: How the Baby Boom Will Redefine the Mature Market, edited by Leslie M. Harris, emphasizes the complexity of the mature market, noting that the market is "sophisticated, active and willing to try new products." As a group, the book states, they are prepared to spend a greater proportion of their income on indulging themselves than all other segments of the population. "Even given today's realities, they hope for a future lifestyle of personal indulgences" from a range of products and services, including products that help them look young as they age.

But studies show that mature Americans are not happy with many of the marketing programs aimed at them. The problem is that too many marketing campaigns tend to lump the mature market into one vast category, whereas it is actually composed of sub-categories, each with its own individual characteristics.

These group distinctions are emphasized in another highly praised book, The Maturing Marketplace: Buying Habits of Baby Boomers and Their Parents, by George P. Moschis, Euehun Lee, Anil Mathur, and Jennifer Strautman. According to these authors, the buying habits of Baby Boomers differ markedly from their parents - and buying habits within groups differ according to the products or services offered.

Does it sound confusing? Look around at your older customers. You're apt to find that Baby Boomers have different attitudes and tastes than patients in their 60's, and that customers in their 70's and 80's differ as well. You might also develop a new perception of the mature market as younger in attitude than in the past. Even AARP now refers to "60 as the new 30."

It might be complicated, but you'll find that there are many ways to tailor your inventory, marketing and merchandising programs toward the various groups of older members in your community. Books like the ones above can be a helpful place to start.

The mature population often gets overlooked, but demographics show that to be a mistake. One Census Bureau projection estimated that between 2002 and 2007 the number of Americans in the 55+ age group would grow six times faster than the rest of the population! That's a statistic we should all take to heart as we head into 2004.

From all of us here at The Block Buying Group, we wish you a Happy, Healthy, and Prosperous year.

Sincerely,
Michael Block