June 14, 2019
We need to talk about…age – and why the financial services industry could be missing a trickContact
By Kia McLean, Associate Partner
We all know that those in mid to late life are winding down before retirement. They are technology illiterate; they rarely use social media and they are incredibly loyal to a limited number of brands. They have silver hair; they are less active and they are dreaming of downsizing to the countryside. Right?
Wrong. This is all fake news. But it seems these clichéd depictions have stuck (just type ‘baby boomer generation’ into Google Images) and it has potentially led some in the financial services sector to ignore a crucial growing demographic.
Millennials and Gen Z – those adults aged 37 and below – tend to be prioritised when it comes to financial services marketing and communications efforts. But in a time when the population is rapidly ageing, could the industry be missing a trick?
According to the latest estimates from the Office for National Statistics, around 18% of the UK population were aged 65 years or over at mid-2017, compared with 16% in 2007. This is projected to increase to 21% by 2027. What’s more, in 50 years’ time it is expected that more than a quarter of UK residents will be aged 65 years.
Gen X and baby boomers (adults born from the mid-1940s to the early 1980s) outnumber millennials by more than 10 million people – and their views (and spending power) should not be overlooked.
Hiding in plain sight
Analysis from our Who’s Caught The Millennial Bug report reveals those in older age groups are the least likely to feel that communications they receive from financial services firms – from marketing and advertising to policy documents and annual statements – make them feel confident in their financial decisions. It also highlighted another crucial finding: that they have the weakest sense of brand loyalty.
This sense of generational disenfranchisement would be a cause for concern at the best of times. But in an era of unprecedented industry change for this age group – from the development of a new state pension to new pension freedoms and the end of the default retirement age – it suggests the financial services sector is still playing catchup with the needs of the nation’s ageing population.
A recent study amongst the users of Gransnet and Mumsnet revealed that 69% would be more receptive to brands if their advertising represented over-50s more accurately. Some companies are more vocal on this topic than others. For example, Tanya Joseph, Corporate Affairs Director at Nationwide suggests brands need to stop targeting by age and start targeting by attitude.
Too often the financial services industry only communicates with one segment of the population. And this means a missed opportunity with a large, and rapidly growing, audience. One that is happy to switch between brands, hiding in plain sight.
It’s time to challenge unhelpful myths and stop subscribing to stereotypes. It’s not all Werther’s Originals, cardigans and sunset walks on the beach like the media might have you believe. Let’s redefine what age looks like, before even more opportunities are missed.