From ramping up their presence on Snapchat to enlisting the services of vloggers, companies are constantly looking out for new ways to attract millennial customers. However, they may be missing a trick when focusing solely on the generation that came of age during the height of the Cool Britannia era. SMEs could actually have more to win from attracting baby boomers instead, according to a new report from Hitachi Capital UK, the financial services company, and Cebr, the Centre for Economic and Business Research.
According to the research, people over 50 are more likely to open up their pocketbooks than their younger peers, with the older group outspending younger customers for the first time in the year ending April 2016. In total, people born in or after 1967 spent £376bn on non-essential products that year, which equated to about 6% of total UK GDP and supported an estimated 1.9 million jobs.
And baby boomers are increasingly spending larger amounts: since 2003, their expenditure has increased by 4.6%, while younger consumers’ spending only grew by 1.4%. Additionally, longer life expectancy has meant that the number of over-50s living in the UK increased to 23.6 million in 2015. Given this figure is set to keep rising, it’s hardly surprising that the report estimated that the economic contribution of this group is expected to grow by 57% over the next decade.
Commenting on the research, Robert Gordon, CEO of Hitachi Capital UK, said: “Not only have we shown that this group is now the dominant force in the UK economy but also that their contribution across jobs, spending and wealth creation is growing at a considerably faster rate than the under-50s’.”
Clearly, the value older customers represent is not one that SMEs can afford to overlook.