Is Senior Spending at Risk?
Many retirees with the highest discretionary spending follow the 4% rule. That’s the idea that a retiree can safely spend 4% of their retirement nest egg annually. Nest egg reductions translate to monthly budget reductions.
Nowadays, even the expected monthly income of retired seniors from Social Security distributions to the 68% of retired seniors who have a pension, is cause for concern. With a fixed cash distribution each month, it is painfully apparent to seniors that they are spending more and getting less for it because on inflation. Think about the prices in the grocery store – crazy! And, what about gas. Same income – higher expenses.
For seniors and retired consumers, so much of the current economic state is out of their control. It may seem there is only one way to react — with discipline. For seniors, this means pulling back on spending to maintain the annual budget they’ve set for themselves despite getting less for their budget.
What is the only aspect of their household economy that seniors truly can control? Their spending.
Senior Spending Power
Marketers in all sectors understand that seniors have spending power. And it’s not all health and personal care spending. 27% of seniors have been active recently with luxury retail, specialty sporting goods, upscale travel or entertainment services, per Acxiom retail activity data. Seniors are also shopping online now more than eve. 79% of seniors made a purchase on Amazon in the last 3 months (per Resonate).
In the non-profit world, seniors are the most important cohort is to recurring donations. Typically, contributions escalate with age. Especially when seniors starting using their RMDs. Seniors spend about 62% more than the 35– to 44-year-old age cohort on gifts and charity.
If senior spending is more difficult than in the past, then you need to have a good answer to the real question. Why should they buy from you? Of, if you’re a non-profit, why should they donate to your organization?
Be Proactive – Reach Out
First of all, no one knows about you if you don’t reach out and tell them.
Direct marketing is the absolute best way to get your message into senior’s hands. There are great marketing lists to target seniors by age, income, home ownership, buying habits, travel patterns, charitable giving – just to name a few of the categories you can choose.
Targeted mailing lists let you select the best possible prospects for your business or organization. And, make sure you give them a meaningful offer. Something that will drive them to your store, your medical practice, your insurance agency or your website. After all, your goal is to maximize your share of senior spending.
Using a solid senior mailing list will give you that opportunity.
Use font sizes that are legible. Make sure your phone number stands out. Provide a map so people can find you. Think accessibility on your website.
Repetition counts. Oversized postcards are well-received. And, make sure you use multiple marketing channels to get your message across.