Ehrenberg-Bass Institute
Hook ‘Em While Their Young
Marketers love the youth market. The well publicised "aging of the population" has done little, it seems, to change marketers' behaviour. Advertisers still strive to keep established brands young and fashionable. And in spite of a lack of evidence of any successful brand level segmentation, we see the launches of brands specifically targeting 'the youth segment'.
What makes young buyers so desirable, or older buyers so unattractive ? Two dominant explanations exist, one cynical view is that marketers and advertising agencies are staffed by young (or youth obsessed) people who create marketing campaigns to appeal to people who are like them. The other theory says that young people are less brand loyal. The aim is to grab them while they are young, and work hard to retain them through their fickle youth until they become staid and brand loyal later on, when you no longer have to worry about losing them.
But are older people more brand loyal? Are young people less loyal?
Is loyalty in general fading away ? Is the youth of today more fickle than ever before ?
The marketing mythology says Yes, Yes, Yes, Yes. But it is wrong, wrong, wrong wrong.
Extensive research across a broad range grocery products shows that the repeat-buying of older consumers is not different from that of young consumers. Both groups tend to buy from fairly fixed repertoires of brands. Contrary to popular belief older consumers don't have smaller repertoires. Likewise then, the view that young consumers are inherently fickle or that they buy from a wide range of brands while they sort out their preferences is also incorrect.
Each generation of marketers likes to feel that they have got it tough, that consumer loyalty is not what it used to be. But there is no evidence of any wholesale decline in brand loyalty. Changes in the loyalty levels in a product category are largely to do with the number of brands competing in the category. Some categories have more competitors than they used to - and it is here that marketers complain about declining loyalty, while other categories have fewer competitors (eg, computer operating systems) and therefore fewer complaints from the brands that remain.
These myths aside, is there still value in targeting young consumers, particularly ones entering the market for the first time (ie gaining wages and becoming buyers)?
An important consideration in answering this question is: does loyalty exist ? Presumably if it does, then gaining young, ie, new buyers, is important – there's a fighting chance you'll have them for life (or at least a decent period). If loyalty doesn't exist then it makes no sense to talk about gaining new customers – one sale gives no indication that there will be another.
The good news for youth obsessed marketers is that there are volumes of evidence in support that loyalty does exist. It's usually ‘divided loyalty’, buyers maintain a portfolio or repertoire of brands that they buy from, but this divided loyalty appears to be fairly stable. Buyers maintain the composition of their repertoires for quite long periods it seems. Indeed, a longitudinal study that followed the first-brand loyalty (the brand used most) of a group of US high school students showed a surprising degree of stability in preferences from their last year of high school to 12 and then 20 years later.
So winning new customers looks attractive, since they are likely to stay for a long time. In this respect maybe young buyers are more attractive in that they will be around for longer – but to think that they will be any easier to win (or lose) than older customers are is quite incorrect. Age, it seems, has nothing to do with loyalty.
By Byron Sharp
Uncles, Mark D. and Andrew S. C. Ehrenberg (1990), "Brand Choice Among Older Consumers," Journal of Advertising Research (August/September), 19-22.
Guest, Lester (1964), "Brand Loyalty Revisited a Twenty Year Report," Journal of Applied Psychology, 48 (2), 93-97.
Dekimpe, Marnik G., Jan-Benedict E.M. Steenkamp, Martin Mellens, and Piet Vanden Abeele (1997), "Decline and Variability in Brand Loyalty," International Journal of Research in Marketing, 14 (No. 5), 405-20.
To view marketing commentary from the Institute Director, Dr Byron Sharp, click here.
To view Ehrenberg-Bass Institute video channel, click here.
Marketers love the youth market. The well publicised "aging of the population" has done little, it seems, to change marketers' behaviour. Advertisers still strive to keep established brands young and fashionable. And in spite of a lack of evidence of any successful brand level segmentation, we see the launches of brands specifically targeting 'the youth segment'.
What makes young buyers so desirable, or older buyers so unattractive ? Two dominant explanations exist, one cynical view is that marketers and advertising agencies are staffed by young (or youth obsessed) people who create marketing campaigns to appeal to people who are like them. The other theory says that young people are less brand loyal. The aim is to grab them while they are young, and work hard to retain them through their fickle youth until they become staid and brand loyal later on, when you no longer have to worry about losing them.
But are older people more brand loyal? Are young people less loyal?
Is loyalty in general fading away ? Is the youth of today more fickle than ever before ?
The marketing mythology says Yes, Yes, Yes, Yes. But it is wrong, wrong, wrong wrong.
Extensive research across a broad range grocery products shows that the repeat-buying of older consumers is not different from that of young consumers. Both groups tend to buy from fairly fixed repertoires of brands. Contrary to popular belief older consumers don't have smaller repertoires. Likewise then, the view that young consumers are inherently fickle or that they buy from a wide range of brands while they sort out their preferences is also incorrect.
Each generation of marketers likes to feel that they have got it tough, that consumer loyalty is not what it used to be. But there is no evidence of any wholesale decline in brand loyalty. Changes in the loyalty levels in a product category are largely to do with the number of brands competing in the category. Some categories have more competitors than they used to - and it is here that marketers complain about declining loyalty, while other categories have fewer competitors (eg, computer operating systems) and therefore fewer complaints from the brands that remain.
These myths aside, is there still value in targeting young consumers, particularly ones entering the market for the first time (ie gaining wages and becoming buyers)?
An important consideration in answering this question is: does loyalty exist ? Presumably if it does, then gaining young, ie, new buyers, is important – there's a fighting chance you'll have them for life (or at least a decent period). If loyalty doesn't exist then it makes no sense to talk about gaining new customers – one sale gives no indication that there will be another.
The good news for youth obsessed marketers is that there are volumes of evidence in support that loyalty does exist. It's usually ‘divided loyalty’, buyers maintain a portfolio or repertoire of brands that they buy from, but this divided loyalty appears to be fairly stable. Buyers maintain the composition of their repertoires for quite long periods it seems. Indeed, a longitudinal study that followed the first-brand loyalty (the brand used most) of a group of US high school students showed a surprising degree of stability in preferences from their last year of high school to 12 and then 20 years later.
So winning new customers looks attractive, since they are likely to stay for a long time. In this respect maybe young buyers are more attractive in that they will be around for longer – but to think that they will be any easier to win (or lose) than older customers are is quite incorrect. Age, it seems, has nothing to do with loyalty.
By Byron Sharp
Uncles, Mark D. and Andrew S. C. Ehrenberg (1990), "Brand Choice Among Older Consumers," Journal of Advertising Research (August/September), 19-22.
Guest, Lester (1964), "Brand Loyalty Revisited a Twenty Year Report," Journal of Applied Psychology, 48 (2), 93-97.
Dekimpe, Marnik G., Jan-Benedict E.M. Steenkamp, Martin Mellens, and Piet Vanden Abeele (1997), "Decline and Variability in Brand Loyalty," International Journal of Research in Marketing, 14 (No. 5), 405-20.
To view marketing commentary from the Institute Director, Dr Byron Sharp, click here.
To view Ehrenberg-Bass Institute video channel, click here.
