The Amazing Blindness of Marketers

One of the long-running themes of this blog is how the marketing and advertising world have lost touch with reality .

There are two major manifestations of this disconnection. As you might expect from an industry as confused as ours, they are contradictory.

First is the delusional religion of the shiny new object. It is a tendency to fall in love with whatever is new. It is a future-fantasy instinct.

The second is the unconscious adherence to legends and rituals. It is a reactionary instinct.

I have written a lot about the first -- particularly in reference to the fads and fantasies of digital marketing.

Today we are going to talk about the second.

One of the first posts I wrote for this blog 3 years ago was called "Aiming Low." I said...

Of all the dumb things that advertisers do, one of the dumbest is aiming their message too young....There seems to be an irresistible need for marketers to target young people despite monumental evidence that older people have far more money, are far easier to reach and all-in-all make better customers.

The post went on to say that people over 50...

  ...control 77% of all financial assets
  ...control 50% of all discretionary spending...
  ...are the target for 10% of all advertising

There are only two possible explanations for the above. Either advertisers are crazy, or they are hopelessly out of touch with...the people who economically control this country.

An article in MarketingDaily last week gives us good reason to believe that in the intervening three years, if anything, marketers have gotten even farther out of touch.

According to the piece, Nielsen says...

• Baby boomers dominate 94% of all consumer packaged goods categories.
• They purchase almost 40% of consumer packaged goods
• They account for 1/3 of all TV viewers, online users, social media users and Twitter users.
• Even in technology categories, where marketers assume young people dominate, baby boomers  "are purchasing at rates just as high as other segments, and because they are often buying for their kids, many are double-dipping." 

The astounding part: According to this article, less than 5% of advertising is aimed at people over 50.

So you ask yourself, how can marketers and advertisers possibly be this stupid? 

Simple -- legends and rituals. 

The legend is that baby boomers are frozen in some universe where nothing ever changes. According to Nielsen, "...marketers continue to believe that Boomers are either reluctant to experiment with new technology and brands, or that because they've been loyal to a certain brand for a number of years, they'll stay that way." This nonsense has been around since the first 26 year-old was made an assistant brand manager.

The ritual is that you have to target the young and hip. Why? Um, because...well, that's what we always do...and anyway, um...I'm a media planner and I'm young and hip, and all my friends are young and hip... and um....

And then there's this. Once again, from Aiming Low

The worst and perhaps most pervasive rationale for targeting young people is the notion that if you get them young you’ll have them for life. This is the idiotic “lifetime value” argument ... Someone please show me one 50-year-old who drives the same car, drinks the same beverages, wears the same clothes, or eats the same food he did at 18.

I mean, besides my brother-in-law.

A Perfect Example...
...of companies witlessly marketing to young people. It's an insurance company marketing to people who a) can't afford insurance (and would have no coverage at all if it weren't for mommy and daddy) and b) are the worst insurance risks imaginable. But they're oh so young and hip.

Legends And Rituals

From The New York Times about a week ago:

"According to a study... boomer households account for unexpectedly high percentages of sales of products considered mainstays of younger consumers. That includes beer, 59.7 percent; carbonated beverages, 58.9 percent; and candy, 54.2 percent..."

To the enlightened readers of The Ad Contrarian, this should not be surprising. On many occasions we pests here at TAC have commented on the stupidity of marketers who think they are required to target young people because everyone else does. In a post called "Aiming Low" we said,

"Of all the dumb things that advertisers do, one of the dumbest is aiming their message too young...

Some facts:

* People over 50 comprise 29% of the population
* They control 77% of financial assets
* They control 50% of all discretionary spending
* They watch 50% more television
* They are the target for 10% of all advertising

There are only two possible explanations for the above. Either advertisers are crazy, or they are hopelessly out of touch with, and prejudiced against, the people who economically control this country."

Apparently, some people are catching on.

In the NY Times piece quoted above (entitled, "The Older Audience Is Looking Better Than Ever") they extol the virtues of marketing to older people...

For decades, older consumers were largely shunned by marketers... young consumers ...were desired for what were deemed their free-spending ways, eagerness to sample new products and brand-switching proclivities. The idea that they were starting in life with a proverbial blank slate of marketing wants and needs was catnip to product peddlers...

“When you’re a 27-year-old media supervisor or a 32-year-old brand manager, what do you think the world looks like?” Jerry Shereshewsky, chief executive at Grandparents.com. “You think it looks like you..."

Among those aiming more at the older demographic are giants like...Kraft Foods, L’Oréal, Procter & Gamble and Target.

Is there another industry in the world that operates on legends and rituals more than the marketing industry?

Aiming Low

Of all the dumb things that advertisers do, one of the dumbest is aiming their message too young.

There seems to be an irresistible need for marketers to target young people despite monumental evidence that older people have far more money, are far easier to reach and all-in-all make better customers.

Of course, there are some products that rely on the youth market for their survival. But for most companies, targeting young people is simply senseless. When’s the last time you saw a car ad with an old person in it? And yet, of the 13 cars the average American will buy in a lifetime, 8 of them will be bought after the age of 50.

The rationale for always showing young people in ads is the old canard that older people want to be like younger people. In fact, not only do older people not want to be like younger ones, but a recent study showed that half say they tune out when they see a spot pitched to young people and one-third say they actively avoid products whose ads are directed at younger people.

The worst and perhaps most pervasive rationale for targeting young people is the notion that if you get them young you’ll have them for life. This is the idiotic “lifetime value” argument that spawned the dearly departed “new economy.” Someone please show me one 50-year-old who drives the same car, drinks the same beverages, wears the same clothes, or eats the same food he did at 18. I mean, besides my brother-in-law.

Some facts:

* People over 50 comprise 29% of the population
* They control 77% of financial assets
* They control 50% of all discretionary spending
* They watch 50% more television
* They are the target for 10% of all advertising

There are only two possible explanations for the above. Either advertisers are crazy, or they are hopelessly out of touch with, and prejudiced against, the people who economically control this country.

Since I don’t think they’re crazy, the explanation has to be the latter. They have become so used to accepting the 30-years-out-of-date wisdom that every brand has to be “youthful”; they are so used to young and hip advertising winning all the awards; they are so sure that the rest of the world is just like them that they are blind to what is perfectly evident to anyone who looks at this objectively.

Not convinced?

According to Federal reserve data, since 1989, nearly all additional wealth in USA has gone to people 55 and over. In the same time period, adjusted for inflation, people 35-50 have actually lost wealth. In the 15 years ending 2004 (the latest year for which data is available) median net worth rose 97% and income rose 52% for people 55-59. In the same period, net worth dropped 28% and income dropped 10% for people 35-39. “(Baby) boomers...outspend other generations by about 2 to 1 across all product categories.” Marketwatch, March 6, 2007.

Not only is most advertising not appealing to the people who have and spend most of the money, it is alienating them with imagery, values, and cultural references that are actively disliked and resented.

Someone's Been Reading This Blog

On August 1, 2007 The Ad Contrarian published its very first post. It was a momentous day in the great history of digital whining.

The post was called Aiming Low. It was about the massive stupidity of marketers who feel compelled to target young people because everyone around them is doing likewise. Since then I have whined and bellyached about this subject frequently.

Last week, The New York Times ran a piece called, In Shift, Ads Try to Entice Over-55 Set. The story is about the dimwits in the marketing industry who are finally starting to wake up after all these years. As I read the piece, I got the strange feeling I had read it all before. Or even worse, written it all before.

So I went back to some pieces I'd written called Culture Lag,  The Amazing Blindness of Marketers, and Beating Their Heads Against The Wall. I compared them to the ideas expressed in the NY Times piece. Here's what I found:

Ad Contrarian:

"In 1964, the first of these Baby Boomers turned 18. These people provided marketers with an astounding and unprecedented marketing opportunity... Forty years later, this is now an old way of thinking."

New York Times:

"After 40 years of catering to younger consumers, advertisers and media executives are coming to a different realization..."

Ad Contrarian:

"The social phenomenon called the Baby Boom required a new way of thinking."

 New York Times:

"This amounts to a reversal in thinking that took hold during the 1960s, when advertisers first started aiming for baby boomers..."

Ad Contrarian:

"Economics and demographics tell us that young people are no longer a terribly attractive target for most marketers."

 New York Times:

"...the reasons for the shift are not just demographic, they are economic." 

Ad Contrarian:

"For several years now, we at Ad Contrarian Global Headquarters have been ranting about the astonishing stupidity of marketers for relentlessly chasing young people and ignoring people over 50"

New York Times:

"For decades, television has been the most determined proselytizer on behalf of the premium value of reaching consumers aged 18 to 49..."

Ad Contrarian:

• Baby boomers dominate 94% of all consumer packaged goods categories.
• They purchase almost 40% of consumer packaged goods
• They account for 1/3 of all TV viewers, online users, social media users and Twitter users.
• Even in technology categories, where marketers assume young people dominate, baby boomers  "are purchasing at rates just as high as other segments, and because they are often buying for their kids, many are double-dipping." 

New York Times:

"Mature consumers also seem to be spending on categories not traditionally associated with older people... they spent more than the average consumer on categories like home improvement, large appliances, casual dining and cosmetics"

They have also become heavy spenders on electronics and digital devices. The study also showed that members of the 55-to-64 age group were just as likely as those ages 18 to 34 to have high-definition televisions, digital video recorders and broadband service.

Now the Times may be brilliant when they see things as I do. But if they believe for a second that because a few marketers have crawled out from their caves and seen the light of day there's going to be a mass realization in group-think-land that they've been wrong all these years, forget about it.

I'll stick with something I wrote six months ago:

"The marketing industry is locked into a way-out-of-date time warp in which young people are the holy grail...If anything, it's getting worse."

More Marketing Morons

According to Ad Age, Pontiac is shifting its advertising efforts toward media that appeal to younger audiences such as video game tie-ins, Web ads and spots on sports channels and late-night shows.

The logic of this is perfectly idiotic and, as such, perfectly in line with the brainless reflexes of so many marketers. (See Aiming Low) A few facts:

1. The average Pontiac buyer is over 50.
2. Baby Boomers and older comprise as much as 80% of the market for new cars.
3. Of the 13 cars the average American will buy in a lifetime, 8 will be bought after they're 50 years old.
4. Even if they want a Pontiac (which they don't and never will) young people can't afford new cars, and no lender in their right mind will finance them.

By the way, Pontiac sales are down over 14% this year. Hard to figure, isn't it?

SUBSCRIBE TO THE AD CONTRARIAN

Stick a Knife in My Head

We’ve been ranting for quite some time about how advertisers are missing a huge opportunity by always targeting young people.

In short, people over 50 have 77% of the money and are the target for about 10% of all advertising (see "Aiming Low.") According to The New York Times it looks like some companies are starting to wake up

However, with their typical heavy hand, most marketers will blow their opportunity with this target by pandering to them instead of talking to them. They will make the same mistakes that they make with every other “generation” by holding up a mirror and saying, “This is you. See, we understand!”

Let’s clear this up right now. A person is not a generic symbol of his generation. He is an individual. In order to motivate him you need to provide a specific, differentiated benefit. All the sociological/cultural baloney you hear from your agency about “Gen Xers are this” or “Gen Y’s are that” or “Baby Boomers are this” are simply lazy clichés that offer virtually nothing that is useful in advertising strategy.

Nonetheless, TAC predicts even more of that brainless, atrocious “Ameriprise”-style advertising that makes me want to stick a knife in my head.

SUBSCRIBE TO THE AD CONTRARIAN

Blind to the facts

Advertising and marketing people want to believe that everyone is young, urban, and hip -- just like them. That's why so much advertising is misguided and irrelevant to the people who actually buy things.

The idea that every product must be marketed to a young audience is so baked into the DNA of the marketing community that they can't see beyond this counterproductive, crippling prejudice. Two recent experiences brought this point home to me.

I recently went to a conference at which a company explained its "youth" strategy. Because this company sells expensive products, their young buyers are defined as 18-34 year olds.

They showed us video made by people they are targeting. The videos were about the new and different ways these 20-somethings use media (by the way, anecdotal video like this has zero value as research, but that's another story.) Then they made the point that they will be using non-traditional media and creative strategies to reach these people. Only one problem. The average buyer of this product is 53 years old. They skipped over this fact so fast you'd think it was radioactive. In spite of the fact that their average customer is over 50, they have convinced themselves that this is a "youth" product. Not one person raised his hand and said "wait a minute."

Second, I was privy to some research done for a financial institution. The key fact to know is that 77% of financial assets in the US are controlled by people over 50. In the many focus groups that were conducted to study the behaviors and beliefs of customers in this category, there was not a single person over 50.

For more about this, see Aiming Low.

SUBSCRIBE TO THE AD CONTRARIAN

Only In California

PETA (People for the Ethical Treatment of Animals) thinks we would treat fish more kindly if instead of calling them "fish" we started calling them "sea kittens." This is not a joke.

Because of the budget deficit in California the state is planning to close a bunch of state parks including one called Pescadero State Beach. Pescadero means "place to go fishing."

PETA have offered to pay to keep the beach open if the state will agree to change the name from "Pescadero State Beach" to "Sea Kitten State Park."

You simply cannot make this shit up.

Seth Nails It

Ever wonder why big corporations keep hiring the same agencies over and over?

Seth Godin nails it in this short but insightful post.

There is a pattern to life in large corporations. It's not a pattern specific to a particular large corporation, but to all of them.

If you deal with them long enough, you get to recognize the language, the values, the legends, and the rituals.

You also get to recognize the types of people who work at these places and how they tick.

There are ad agencies that are specialists at this. They have learned how to talk the talk and walk the walk. They are very successful.

They may not be very good at creating ads, but they are brilliant at writing presentations that get MBAs to nod their heads.

Not So "Free" After All

Chris Anderson, author of The Long Tail and editor in chief of Wired, has a new book called Free.

The point of the book seems to be, I don't know, some baloney about "we should not fear free." I've only read reviews of the book but the point seems to be that if you give away stuff for free, it will lead inexorably to money-making opportunities.

I'm not sure how, but I believe that this is related to the idiotic argument made by web maniacs that everyone is entitled to everything free on the web. Why should all intellectual property be free? Um ... because ... um ... "information wants to be free"... or some such childish nonsense.

Anyway, I'm not about to review a book I haven't read so you can discount everything I've said above. The real subject of this post is this: To prove his point, Anderson is giving his book away free. "I felt it was important to walk the walk," said Anderson.

Bullshit.

He's not giving away anything for free. If you want to read the book, you have to read it on line (you can't download it) and you only have a few days to do it before the hard copy of the book is released, then no more.

That's not called "free", that's called "sampling" and it's a marketing technique that's been around almost as long as authors working a PR hustle.

Read This Post

TAC has previously posted about the stupidity of marketers who have a knee-jerk reaction about targeting young people (see Aiming Low.)

Another great take on this subject, by Brent Bouchez, is found here.

A Good Start To The Weekend

A brilliantly written, wonderfully acted comedy scene -- Mary Richards meets Lou Grant for the first time.

Ritz Bits

People over 50 control 77% of the financial assets of this country and are the target for 10% of all advertising. The prejudice against older customers is so strong and so pervasive that even smart companies can't see beyond it (see Aiming Low.)

A few years ago, Saks Fifth Avenue decided their customers were too old. They embarked on a plan to attract younger, hipper customers. After two disastrous years, they came to their senses, fired their ceo, and got back to business.

Now Ritz-Carlton is taking the first steps toward the same dumb strategy. According to The Wall Street Journal, they are producing three long-form films that are aimed at repositioning them as "young and hip".

Here's what's wrong with this strategy:

1. Ritz is not young and hip. Why do they want to pretend to be something they are not?

2. There are plenty of young and hip hotels in every major city in America. Another y&h hotel is exactly what high end travelers don't need.

3. Remaining contemporary is important. It should be done with re-designs, re-furnishings, and new services. Ritz should take a look at some of the newer Four Seasons and Peninsula Hotels. They can get rid of the "fox and hounds" look without making a big "repositioning" fuss.

You can bet Ritz is doing this because they did some research that showed younger customers think they're stuffy. So what? I can tell you that as a heavy user of Ritz hotels, I stay with them precisely because I don't have to sit at the bar next to the leather pants, hat-on-backwards crowd.

You can also bet there a lot of 30-somethings at their agency telling them they need to get younger. It's impossible for these people to understand that they are not the world's only target audience.

The good news for Ritz? It sounds like these movies are only going to be accessible on their website, so no one will see them anyway.

SUBSCRIBE TO THE AD CONTRARIAN

Nobody Learns Anything

The very first post I wrote for this blog almost 5 years ago was called Aiming Low and was about marketers' unrelenting stupidity at targeting young people in advertising.

A few months later I wrote a piece about Pontiac mindlessly doing exactly that:

According to Ad Age, Pontiac is shifting its advertising efforts toward media that appeal to younger audiences such as video game tie-ins, Web ads and spots on sports channels and late-night shows.

The logic of this is perfectly idiotic and, as such, perfectly in line with the brainless reflexes of so many marketers... A few facts:

1. The average Pontiac buyer is over 50.

2. Baby Boomers and older comprise as much as 80% of the market for new cars.

3. Of the 13 cars the average American will buy in a lifetime, 8 will be bought after they're 50 years old.

4. Even if they want a Pontiac (which they don't and never will) young people can't afford new cars, and no lender in his right mind will finance them.

Now that Pontiac is dead and buried (huge surprise!), General Motors, having learned nothing, is in a big push to apply the same brilliant strategy to Chevrolet.

According to The New York Times, General Motors has hired MTV (Ohmygod, how cool is that?) to teach them how to sell Chevys to young people.

But unlike Pontiac, which only pissed away media dollars, Chevy is flirting with frittering away its whole culture on people who don't buy cars, don't want cars, and can't afford cars.

According to The Times...

"The partnership (with MTV) is intended to transform things as diverse as the milieu at the company’s steel-and-glass headquarters, the look of its Chevrolet cars, the dealership structure and the dashboard technology. Even the test drive is being reimagined, since young consumers find riding in a car with a stranger creepy..."

You wanna talk creepy?  Listen to this...

"Mr. Martin (the MTV guru-in-charge) has recruited what he calls “insurgents,” young Chevrolet employees who are willing to change things from the inside and report to him on skeptical executives."

What a great idea! An internal Gestapo ratting out non-compliant employees. The Cultural Revolution comes to Detroit.

"Last summer, (the MTV) team temporarily transformed part of the G.M. lobby into a loftlike space reminiscent of a coffee shop in Austin or Seattle, with graffiti on the walls and skateboards and throw pillows scattered around."

They can keep their damn coffee, where's the weed? By the way, it just doesn't get any cooler than Seattle or Awestin.

“We tried to teach dealers how to calibrate conversations”

Yeah, that oughtta work. I can just hear the training session now:

MTV: You really need to learn how to calibrate conversations...

DEALER: Calibrate this, asshole.

A lot has changed since I started this blog 5 years ago. But one thing will never change: Marketers' brainless, pathetic pursuit of young people.

Jersey Old Men

TAC has written previously about the remarkably under-utilized potential for marketing to people over 50 (see Aiming Low)

It was reinforced recently when I went to see Jersey Boys, a stunningly mediocre exercise in pop nostalgia (full disclosure: I almost always hate Broadway musicals.)

The writing was exactly what I expected -- that cloying high school sensibility that so often infuses Broadway shows. The real shocker was the music. A Vegas Four Seasons cover band could have done better.

None of this seemed to bother the baby boomer crowd that packed the theater. They reveled in the self-referential material.

The producers of this musical have cannily filled a gaping marketing hole -- entertainment for baby boomers. Just as so many other industries have foolishly placed all their chips on the youth market, the entertainment industry is not producing nearly enough "product" for these people.

I expect the producers of Jersey Boys have made a fortune. There are more fortunes to be made.

SUBSCRIBE TO THE AD CONTRARIAN