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Direct Response Marketing

Hitting the Sweet Spot

1 Nov, 2010 By: Bridget McCrea Response

Dissecting your target customer base one generation at a time.


 

It’s no secret that every generation has its own set of unique attributes. The nation’s older generations tend to be a bit more frugal with their money and deliberate when it comes to spending it. The middle “Baby Boomer” ground has its own buying habits, often spending more discretionary income than its parents did, yet always keeping an eye on its looming retirement. Right behind that 78-million-strong bunch are the independent-thinking Generation Xers, followed by the Millennials, a group that basically emerged from the womb ready to use mobile phones, laptops and the Internet.

Marketers looking to target American consumers have quite a task before them, based on the distinct generations that now make up their target demographics. “Each generation is not only oriented differently, but also shops and buys in its own distinct manner,” says Gwen Goodloe, owner of Third House Productions in Scottsdale, Ariz., “and as such requires a different marketing approach.”

The current economy isn’t making it any easier for DR marketers to dissect and hit their target customer bases. Regardless of the consumer’s age and habits, says Goodloe, things are tough all over. Add in the fact that products and services are proliferating at a rapid pace, she says, and standing out from the clutter becomes even more difficult for companies.

To break through that barrier, Goodloe says some marketers are using newer technologies, such as mobile applications. Because many Baby Boomers are already tech-savvy, such efforts tend to hit a wide swath of the under-65 population.

To reach the youngest groups (Generation Y and the Millennials,), the company is using different techniques. Recently, for example, Goodloe and her team shot a product demonstration DR spot to be screened at movie theatres and streamed onto the Web.

“We shot it with the idea of having it shown on a really large screen, and made sure that when it was blown up, the spot would be crystal clear,” says Goodloe, who included text content and Web addresses as the DR spot’s calls to action, based on the fact that younger generations are less apt to pick up the phone to place an order. She says the latter is a major barrier for marketers, many of which are scratching their heads over how to increase response rates from these groups.

“I don’t see a lot of companies wanting to market to the younger generations via DR right now,” says Goodloe. She says the movie theatre approach worked well for her client’s campaign, particularly when it came to pushing retail sales. “Was it a DR success? Probably not,” says Goodloe, “but we were able to measure how it affected overall product sales, and the results were positive.”

 
Different Strokes

The days of the one-size-fits-all DRTV spot or infomercial are gone forever. Consumers now demand more from the companies that they buy from; they want information that is tailored to their age group, and that speaks directly to their wants, needs and pain points. The good news is that marketers who take the time to do their homework and put some elbow grease into learning about their target markets are the ones that reap the rewards: higher sales, improved customer satisfaction and increased loyalty.

Credit the 78 million Baby Boomers with creating this new marketing environment. Their sheer size, prowess and spending power have made companies sit up and take notice of the need for generational marketing. The younger, tech-savvy generations, which have shunned most traditional media outlets in favor of the digital kind, furthered the cause. The latter’s short attention spans and reliance on technology, as Goodloe knows, make it hard to target with a 28.5-minute infomercial and telemarketing center.

The Web has proven itself to be a marketer’s best friend in this evolving environment, where “integrated” DR campaigns can actually work — and with not much additional expense — with the help of innovations like social networking and online video. “When you can take the traditional DR approach and somehow drive it into the Web loop,” says Goodloe, “you can target your message to the different generations of consumers.”

That beats taking one commercial and cutting six different, slightly skewed versions of it for six different audience groups, says Goodloe, or attempting to test multiple versions of a show on television. “The Web is a great place to mix up your target message and test out different calls to action and offers,” she explains, “with the goal of reaching as many generations as possible.”

 
Honing In

As DRTV marketers scramble to find ways to reach younger audiences, they should also keep a sharp eye on America’s senior population, which includes the Greatest Generation (born 1901 to 1925) and the Pre-Boomer Generation (born 1925 to 1945). Currently aged 64 and up, members of both generations comprise a large segment of the population that’s often overlooked in favor of the huge Baby Boomer demographic and/or younger consumers.

With life expectancies hovering around 78 years and a huge number of Baby Boomers following in the Pre-Boomers’ footsteps, by 2050 the number of individuals over 65 will outnumber those younger than 20 for the first time in history. A Pre-Boomer himself, Don Potter, a DRTV pioneer who is now a consultant and blogger (www.pre-boomermusings.com) in Los Angeles, has his finger on the pulse of America’s older generations.

Potter says most DR firms completely miss the mark when attempting to sell to his generation, namely because they don’t understand the market or its hot buttons. Younger marketers — who don’t know how it feels to be 70 — tend to miss the mark more than most. “They think all old people wear dentures, and that’s just not the case,” says Potter, who points to Viagra’s advertising as good example of effective generational marketing. “That company has figured out how to sell to someone who is older, but who still thinks young.”

Put simply, Potter says: “Old people don’t want to be treated like old people.” So if your marketing message talks down to that audience, or makes them feel like they are 65-plus, then it won’t resonate. “This group is vital and very much alive, and wants to be paid attention to,” says Potter. “That doesn’t mean your copywriter has to be 65, but he or she does have to understand how the generation thinks.”

Jon Noell, vice president of sales and marketing for Media Services 55, a Laguna Woods, Calif., cable system, says his firm has discovered an effective formula for reaching older audiences via DR. He points to the Hallmark and History Channels as two particularly good media outlets for DR airtime, and says a combination of 30- and 60-second short-form shows plus a promotional campaign (via a live TV news show, for example) and infomercials tend to work well to reinforce the messages and get older consumers to act.

“When they can see it and hear it, and then get a perspective from an inventory or spokesperson (who talks to the news reporter for the live TV show, for example),” says Noell, “the chances that they will buy definitely increase.”

When targeting older generations, Potter says DRTV marketers have a distinct advantage in the fact that these folks still watch traditional, broadcast TV. Less interested in online video and social networking than their younger counterparts are, these consumers aren’t beyond writing down a URL or phone number, and then following a spot’s call-to-action to either find out more about a product, or make the buy.

Many times, the mature consumers’ next stop after seeing a spot or infomercial on TV is the Web. “We may not be into texting, tweeting and using Facebook, but we do use E-mail and the Web a lot,” says Potter. “We know how to research and order online, which means marketers can save a lot of money on telemarketing when targeting us with their products and services.”

 
Targeting Your Message

Exactly how those products and services are presented via a DR campaign can mean the difference between hitting the generational target and completely missing it. Factor the media, the message and the item itself into the equation, says Potter, and realize that while not too many seniors are going to buy a leopard-print Snuggie, “they will buy the original version.”

The same care has to go into any DR aimed at younger generations, most of which have come to expect that elements such as social networking, mobile messaging and online video will be a part of the show. The good news is that integrating these additional contact points into a campaign is neither expensive nor time consuming, says Goodloe, but it is critical.

“The only way you’re going to win the generational marketing game is through integration,” says Goodloe, adding that companies that aren’t convinced of the value of say, a Facebook presence, have to bite the bullet and trust in the usefulness of such efforts. “We have a lot of great TV data, but there’s not a lot of history in place to support things like social networking,” says Goodloe, “yet over time, it does appear to be an important component, even though we can’t put numbers on it.”

For now, innovations like social networking and YouTube rank on a short list of innovations that younger generations actually respond to. Where their parents may have been impressed by Ron Popeil’s Showtime Rotisserie shows, Generation Y doesn’t have much experience in the DRTV realm. Because of this, marketers have to reach those young adults on their own terrain. “Generation Y isn’t going to buy from an 800-number, so we have to drive them to where they purchase from, which is the Web,” says Goodloe. “Everything we do has to be really modern and social, or it won’t work.”

Expect more DR marketers to put an effort into learning the nuances of their diverse audiences in the future, as the exercise is becoming harder and harder to ignore while the nation’s population is continually dissected and assessed from every angle. “Now is the time to really figure out who you’re selling to, and then hone your marketing message in a way that speaks to your audience,” says Potter. “Ignore this step, and you’ll miss out on major opportunities.”

 

Mining the U.S. Generation Gaps
 

Understanding shopping and media habits at different ages can help marketers optimize critical assortment, pricing, promotion and advertising decisions by crafting targeted strategies and niche offers that reflect deal propensity, trip frequency, channel predilection, average spend and media usage. A recent Nielsen report broke down the generations into these four segments:

  • Greatest Generation: born prior to 1946 (65 + years of age)
  • Boomers: 1946–1964 (45 to 64)
  • Gen X: 1965–1976 (33 to 44)
  • Millennials: 1977–1994 (15 to 32)

According to Nielsen, the Greatest Generation members, shaped by the Great Depression and World War II frugality, are the most frequent shoppers and more deal prone than other age segments. High-earning Boomers have the largest annual dollar spend per household of any group, followed by GenX. Millennials don’t like to waste time in-store, shopping less often than other age cohorts but buying more per trip as a result.

So what is the best way to reach each generation and capitalize on their unique shopping interests and needs? Here are some suggestions from Nielsen:

  • Greatest Generation: Freebies and senior discounts to appeal to their value orientation. Special products addressing aging issues; special packs for smaller households. Better signage, more forgiving package design, on-shelf or on-cart magnifying glasses. These savvy shoppers spend most of their online time using E-mail and message boards, providing two ready avenues for delivering targeted offers and initiating value-added discussions about health issues and special wellness programs.
  • Boomers: Keep these big spenders happy with monthly or quarterly cash-back savings programs that reflect spending levels. Pursue the upsell into prescription medications, insurance, gifts for grandkids and kids, entertainment, travel, even discount wines by the case. Comprising more than one-third of the Internet population, Boomers are big online shoppers, comfortable using E-mail and messaging to stay in touch. Twitter is a huge untapped outlet for reaching Boomers, who increased utilization 469 percent during 2009. Reach one and you reach their entire follower base with product information and special offers.
  • Gen X: Time is a precious commodity for these busy young families, so reduce deadline pressure by offering meal planning and deals, school supplies and little indulgences like lattes to make shopping less onerous. Childcare activity centers or computer kiosks keep kids engaged while parents shop. In-store cooking or craft classes offer family fun and a reason to increase the trip count. More than 80 percent of Gen Xers are online checking out Facebook, MySpace and Twitter, shopping and price checking online and texting or E-mailing friends. Deliver quick hit info and offers using new media for fast results.
  • Millennials: Coffee stations with battery chargers and in-store Wi-Fi let them kick back and review Internet or mobile coupons and shopping lists. Convert their need for immediate gratification into impulse-buy sales with enticing end caps and front-of-store bins. These visually oriented shoppers will Tweet and text about special deals real time from the store aisles about what looks good today, where to meet-up, and anything cool that catches their eye on site. If you’re lucky, you’ll hit a quirky Millennial sweet spot, and they’ll YouTube or Hulu a video of a helpful employee or unusual in-store promotion.

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