Breaking Down Your Target Audience (The Five Generations) by Numbers

Although knowing the social media habits of your target audience is an excellent start, it's vital to work with the numbers. You need to break down the different generations in terms of salaries to determine their spending power. Customizing your marketing strategy is easier once you know the average salary by generation and their spending preference.

Read on to further explore the world of marketing psychographics for deeper market analysis.

According to the Financial Advisor report, baby boomers control most of America's wealth — including affluent and high-net-worth households. They have an incredible spending power of more than $2.6 trillion because those still working are at the very top of their lifetime incomes — for instance, 70% of law firm partners are boomers. They also had a lot of time to accumulate wealth. Unlike millennials or Gen Xers who are currently living the most expensive phases of their lives (starting careers and raising families).

However, more than 3 million Boomers will get to age 65 per year until 2029. According to IRI, half of the baby boomers will suffer from arthritis, while about 33% will be obese. Therefore, it presents an opportunity for businesses to design products that can help combat these challenges.  This could be an ideal customer base for those in the health, wellness and fitness business.

For Generation X, having a college education was more of an expectation than a luxury. Gen Xers used college as a way to advance their profession and careers. Therefore, it wasn't a surprise when Statista indicated that they have the highest mean disposable income in the U.S ($90,964). This gives them a spending power of about $2.4 trillion, thus making them a vital target audience for most businesses.

According to FONA Research, Gen Xers will make several significant shifts in priorities as they get older. These include focusing more on sustainability, self-care, balance, and health. At the moment, Gen Xers are hyper-focused on their families and having enough income to pay for convenience. Their millennial and Gen Z kids also play a huge role in getting them out of their comfort zones to try new things.  If your products and services are seen as more of a luxury than a necessity, then this could be an ideal customer base for you.

According to BLS, millennials have an average yearly expenditure of around $47,112. These numbers are considerably low due to their outstanding college debt and increasing responsibilities. However, marketers can't ignore their 1.4 trillion spending power and influence on brand longevity.

This generation is leading the pack when it comes to online purchases. According to JungleScout, 91% of millennials prefer shopping online, while only 9% chose in-store shopping. However, over 40% refer to online testimonials and reviews before making a purchase. Brands need to focus on providing excellent customer service, unique experiences, and value for money to capture this target audience.  So if your business is not online, then you will miss out on this generation, entirely.

Although still a young generation, Gen Z has a spending power of $143 billion. They also generate about $127.5 billion in family member spending. Predicted to become better educated and more culturally diverse than previous generations, understanding their spending habits needs to be a top priority for most companies. Luckily, the marketing opportunities are rather open with this generation as brands and retailers are still trying to find ways of appealing to them.

For starters, this generation inherits some spending characteristics from the millennial generation. Therefore, they have a high expectation for digital sales channels and payment technology to be fast and reliable. Equally, Morgan Stanley Research estimates that this generation will spend a large portion of their income on mobile devices, eating out, and housing.  Restaurant owners, you should be looking to meet the expectations on this generation.

Did you know that four out of five kids under the age of 12 significantly influence family purchases? These Generation Alpha kids account for about $500 billion in purchases every year. Although marketers don't usually start targeting a generation until their teen years; Generation Alpha has more spending power than any other pre-adolescent generation.

Brands are finding it easier to get to the pockets of parents by appealing to the hearts of their children. Therefore, it is imperative to consider interactive and personalized marketing strategies when targeting Gen Alpha. You should also consider subscription services, in-app purchases, and digital content to activate Gen Alpha consumers easily.  If your product or service focuses on kids, then this is the audience where you will find success.

Understanding your target audience (by generation spending power and preferences) is critical in safeguarding your bottom line. The biggest mistake you can make is sitting back and waiting for customers to find you. Instead, start proactively marketing to your audience on the appropriate social media platform.  

At Digital Edge Marketing Agency, we work with you to guarantee successful customer contact for each of the above five generations. Our Managed Social Media Management Services will help get your brand in front of your target audience. Ensure you contact us today to redefine your digital marketing campaign.