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News
The Only ‘Greys’ In The Village?
d=”standfirst”>The drinks industry has been slow off the mark to target the ‘grey pound’ but we ignore this affluent group at our peril, according to market research
A RECENT report in The Times claims that “big business is increasingly targeting the grey pound”. Evidence of industries from finance to travel moving to target this demographic was clear from the article, but the beverage sector was conspicuous by its absence, which got us on the news desk at db thinking: is the drinks industry doing enough to target older consumers?
The “grey pound” generally refers to the over-50 population, with the affluent greys being the most attractive section – a Mintel report puts this sector at 7.6% of the population, a figure which looks set to increase sharply as the population ages. A Future Foundation census analysis revealed that in 2020 there will be 5.2m more people in the 45 to 74 age group than there are now and it has been predicted that by 2041 the over-75s will outnumber those aged between 55 and 74.
Anne Nugent, head of alcoholic drinks research at the market analysis firm Euromonitor, says: “The drinks industry could do a lot more to target this group of consumers and wine in particular has a clear opportunity. There is constant focus on the younger consumer, with brand managers concerned at having brands that seem outmoded or ones which are identified with older consumers. But with a heavily saturated market in Western Europe and an ageing population, it makes little sense to ignore this group.”
However, there does exist a strong school of thought among drinks industry brand managers that by targeting young consumers the brand will catch them early and keep their loyalty for a lifetime. Another issue, it has been said, is that the on-trade, a sector which can be very useful in the art of building a drinks brand, is seen, by and large, as being populated by the youth of today. Nugent, however, points out that other brand building methods do exist, methods that do touch the grey demographic.
She says: “Piat d’Or remains a major wine brand in the UK, and it is highly probable that it is benefiting from an older consumer base, which has memories of this brand in the 1970s. With little else by way of reference to recommend itself, older consumers are likely to go for a safe and familiar option like Piat d’Or.
“But companies which are currently capturing the grey pound most effectively are most likely to be direct sellers and wine clubs which advertise in the broadsheets such as the Financial Times.
“Delivery is important and direct sellers offer convenience, avoiding weighty supermarket purchases. I have no doubt also that Richard and Judy’s pre-Christmas review of wines was attentively listened to by many older consumers, a key audience for daytime television. Recommendations of this nature offer a safe way in which to experiment.”
Insider Opinion
Mike Paul, Western Wines
“I think the focus has been about how you can get young people to drink more wine rather than how you can get pensioners to drink more wine. Wine remains hugely aspirational for young people and it is better to let it remain that way than to risk ruining that aspiration by dumbing it down for them. I think the pensioner opportunity is more important not just because of an ageing population but because you have people who have more leisure time. Although you hear about pensioner poverty, there are many with a pretty good disposable income.”
Catherine Monahan, Brand Phoenix
“There are certain categories in the drinks industry like ciders, beers, RTDs, and so on, that clearly target younger age groups, and there is an argument to say that the grey pound does not get directly marketed to by any drinks category. The wine industry though, by definition, is still relatively conservative versus other sectors and, therefore, is probably more successful at generating interest and awareness within this group. There are certain proactive mechanics that can be used to market more directly to the grey pound, such as sponsorship of events like music, drama, concerts in the park and theatre, which are more relevant avenues to messaging this group directly. Furthermore, pack sizes such as 2L are more convenient and not too heavy and screwcaps are easier to open. All of these sizes and styles would probably benefit the grey pound sector.
“The question that has to be asked, is, is this a group on its own for marketing by the drinks industry, or is it a middle-aged group that has got bigger and more spread out over the years and with more disposable income? And does a consumer at age 60 now, have the same or similar drinks purchasing habits as when they were 50 years old? Perhaps these consumers should be part of an overall marketing message within the branded and premium sectors of wine. Even within RTDs there are middleaged women as well as teenagers who are drinking Bacardi Breezers. Are they drinking it because it makes them feel younger or because it has Bacardi in it? One needs to realise that it may be incorrect to stereotype the older consumer.”
David Williamson, Scotch Whisky Association
“Scotch whisky companies have struck the right balance with different brands aimed at a range of different consumers. Whisky marketing embraces both the traditional and contemporary, attracting the younger consumer in their 20s and 30s but also continuing to appeal to the older, perhaps more established, whisky drinker.”
Jim Minton, Portman Group
“There is limited understanding of how marketing messages aimed at older people can change their drinking patterns, especially if those patterns have become entrenched over a long period. There is evidence that alcohol misuse has increased among older people. The Portman Group believes that any strategy to reduce alcohol misuse should take proper account of older people, particularly given the growing importance of this population group in demographic terms.”
Guy Young, HwCg
“When we researched for our new French brand, Le Charmant, we studied the market across all age groups, including the 50+ sector. For France in particular this is an interesting area: older drinkers, while very familiar with France, are now far more aware of New World brands and the French wine industry cannot rely heavily on the mature drinker. The French brands that we are developing at HwCg are certainly designed to appeal to the 50+ consumer, in addition to emerging wine drinkers in the market. There is certainly scope for more activity targeted at the grey pound, largely because there are likely to be lots more of them.”
Plastic Corks Lose Grey Vote
In the interests of appealing to this particular market, whose buying power and influence the company noted was increasing, the glass manufacturer Rockware undertook its own research in this sector. Using a focus group of people aged between 50 and 65, all “empty nesters” with no children at home, the company found that typically this demographic:
• is willing to experiment
• buys more indulgent products
• buys more premium and exotic items
• is more ecologically aware
• hates waste
They were also questioned about their attitudes toward packaging and the survey found that this group preferred materials, designs and containers that:
• are easy to open
• are easy to use
• are easy to stack
• are resealable
• allow visibility
• are recyclable
Among pet hates, Rockware found packaging that is difficult to open and wasteful, cited examples of which included shrink-wrap, over-packaged products, lids on vacuum packed jars and … plastic corks in wine bottles! We’re hoping screwcaps are acceptable or there will certainly be tears before bedtime.