At 12:01 AM on January 1, 2011 the Baby Boom generation, those aged 47–65 in 2011, started turning 65 around the world. Between then and December 31, 2029, about 10,000 people will reach age 65 every day in the United States alone. But aging is not the sole province of the U.S., or even the more developed world. Of all the countries in the world, only Niger in Saharan Africa will not see an increase in its median age over the next 10 years – it will start to rise after 2020, according to the UN Population Division World Population Prospects.

Population aging is not a short-term trend or even a medium-term one. As most countries will continue to age well into the second half of the 21st century, population aging is a permanent trend and marketers will need new models to reach aging consumers.

Why Age Matters
As populations age, the significance of consumers over the age of 50 will grow in importance. Already in the U.S., the Baby Boom generation accounts for the largest share of sales of any generation across most product categories. Understanding this new marketplace will be essential for brands that will grow in the 21st century.

Nielsen’s report, The Global Impact of an Aging World, based on findings from Nielsen’s global online survey conducted in more than 50 countries brings much to light about retirement and other sentiments around aging. The one thing marketers must accept for certain about Baby Boomers is that they will redefine what it means to be old in exactly the same manner as they redefined what it meant to be young and middle aged. And they will not allow themselves to be ignored.

The Global Impact of an Aging World provides answers to critical questions to help marketers better understand how to navigate the growing aging marketplace:

• Why are we getting older?
• How old is old?
• When can I retire?
• How will I fund retirement?
• How will I spend my time?
• How will I spend my money?

The New/Old Face of Opportunity
Whether you are a manufacturer who makes the products consumers use, a retailer who sells the products to the consumers, or the media who provide the means for both manufacturers and retailers to talk to consumers, you are impacted by the aging profile of consumers. The senior market is affluent, connected and a force for decades to come. And while this segment represents a disproportionate share of marketplace consumption (in the more developed world), they are often overlooked in marketing plans.

The degree and extent of aging taking place across the globe today is unprecedented. Demographers, sociologists, and marketers will need to develop new models and new ways of thinking to understand the shifts we see today and will continue to see for decades to come. Aging is here to stay.

• For more, download the complete report: The Global Impact of an Aging World.

Top Local Markets
The rankings of the Top 10 local TV markets were unchanged, but in the Top 20, the Miami-Ft. Lauderdale area moved ahead of Denver. No new markets entered the top 100, however there were several changes within the ranks. Austin, TX had the largest spike within the top 100 ranks, moving from 48 to 44.

Other notable local market changes:
There were more changes in the rankings compared to last year, yet still not as many as previous years. It was a tie for the largest increase in TV households, with Odessa-Midland and Austin, both rising four spots. The decline in the overall number of rank changes the past few years reflects overall slower household growth in the U.S. and large declines in domestic migration, particularly to Sun Belt areas. Major metropolitan areas lost less population than usual partially attributable to Baby Boomers delaying retirement plans, individuals unable to sell their homes, and/or individuals unwilling to move away from job-heavy markets. However, the recent increase in rank changes for this year seems to imply some of these phenomena are relatively short term and/or heavily contingent upon economic conditions.

Similarly, while many Florida markets had dropped in rank in the latest estimate (Tampa, Miami, Ft. Myers, Tallahassee) partially as a result of the aforementioned phenomenon, there is evidence of some “bounce back” for markets such as Miami and Tallahassee. Further, previous “high growth” markets (e.g. Las Vegas, Florida markets) which showed diminished growth or even declines in the last two estimates seemed to “stabilize” (i.e. maintain rank) for the most recent estimate. For all these markets, the decreases and/or growths do not necessarily reflect a true decline in population or households. The estimates may also reflect an adjustment to align with the most recent information from the U.S. Census Bureau.

For the first time since the Hurricane Katrina recovery period, the New Orleans market rank has declined (from 51 to 52). Though population in the market has increased, recent trends in Persons Per Household (PPH) indicate that previous PPH assumptions were too conservative (i.e. assuming fewer people per household). To better reflect contemporary population dynamics in the area, the PPH ratio was increased for the recent estimate, based on recent U.S. Census Bureau data, resulting in a smaller than usual increase in the Total Household estimate for this year which allowed the Buffalo market to pass New Orleans.

For a country of more than 300 million persons spread out over 3.6 million square miles, counting the entire populace is an immense logistical feat. To accomplish it, the Census Bureau mails approximately 134 million questionnaires that were to be completed by April 1. That would cost nearly $60 million in postage alone if the Census Bureau did not get free postage from the United States Postal Service (USPS). The collective weight of all 360 million printed questionnaires (from all three mailings) is nearly 12 million pounds, and if stacked on top of one another, would be nearly 29 miles high.

Who uses it and why?
Put simply, the census is used for three primary reasons:

1. To alter the state-by-state appointment of seats in the House of Representatives.
2. To determine how much money the states receive back from the federal government.
3. To provide demographic data used by marketers today.

While congressional representation and distribution of federal funds is vitally important, the third reason represents big business. The U.S. census drives business intelligence in America today and if you have ever examined demographics about consumers, you are likely an indirect user of census data.

From modeling and segmentation strategies to sampling plans and projection results, from site evaluations to trade area definitions, it may hardly seem possible that a once-per-decade survey is a catalyst for the efficiency and competitiveness of the American marketplace.

How is census data used?
Most modern corporations have six key disciplines related to marketing and they all use some element of census data:

1. Strategic Planning & Market Research
2. National Media Strategy
3. Local Market Promotion
4. Product Distribution
5. Channel Management
6. Customer Relationship Management

Learn how each of these integrated functions rely on data intelligence that focuses on the core component of any successful marketing plan—the consumer. You may not recognize the role the Census Bureau plays in carving up the country into statistically reliable and stable units of geography that provide much the foundation for modern Geographic Information Systems and their application.

• Download Nielsen’s white paper report on Business Uses of Census Data.

If you live in the U.S., you’re starting to hear more and more about the upcoming census. Even before we get data back from the country-wide headcount, we know that America’s demographic profile is undergoing major changes. By 2050, more than half of the U.S. population will be non-white (African-American, Asian, Hispanic). This dynamic growth represents not only significant cultural shifts, but also one of the more remarkable marketing opportunities in history. By that same 2050 milestone, the economic opportunity for brands in the multicultural CPG space is projected to exceed $500B.

Being able to keep pace with these increasingly diverse and demanding segments will require marketers to have a detailed view of what ethnic households buy as well as how they consumer media across TV, Internet and Mobile. When compared against the general population, minority households tend to over-index on some key shopping and media metrics.

Topline Multicultural Buying Insights

When compared to the general population, on average…

Hispanic Shoppers

• Tend to spend more on categories for babies and children — (Hispanic households represent 11.8% of CPG total spending, but 16.6% of disposable diaper sales.)
• Tend to spend more in traditional mass merchandise and warehouse clubs
• Tend to spend more on food consumed at home

African American Shoppers

• Tend to spend more on health and beauty products, like fragrance (African Americans represent 11.0% of CPG total spending, but 20.3% of dollars spent in beauty supply stores.)
• Tend to spend more in drug and dollar stores
• Tend to spend more on ingredients used to cook from scratch
• Tend to buy fewer items on deals or with coupons
• Tend to spend more on food consumed at home

Asian American Shoppers

• Tend to spend more in club stores (Asian Americans represent 3.0% of CPG total spending, but 5.5% of dollars spent in warehouse clubs.)
• Tend to spend more on categories for babies and children
• Are more likely to eat outside of the home

Topline Multicultural Media Insights

Hispanic Media Consumers

• Strong following of Telenovelas
• On average, watch more broadcast and satellite TV
• Display higher usage of mobile internet

African American Media Consumers

• Have the highest TV usage of any demographic at nearly 80 hours a week per household
• Have a higher percentage of multi-set households
• Display higher usage of mobile internet

Asian American Media Consumers

• More likely to have newer technology (DVD, HD, Digital Cable)
• Tend to watch less TV

While each group has many layers of cultural, economic and social diversity within, these broader trends are worth noting, and planning for, if marketers are to meet the needs of their fastest growing consumer base.

Time spent online among children aged 2-11 increased 63 percent in the last five years, from nearly 7 hours in May 2004 to more than 11 hours online in May 2009. Time spent among kids outpaced the increase for the overall population, which grew 36 percent in the last five years

Boys spent 7 percent more time online than girls; while girls viewed 9 percent more Web pages than boys did in May 2009.

Online Parents Keep the Camera Rolling

According to Nielsen’s @Plan Summer 2009 data, 26.3 percent of the online adult population, or 38.2 million, have children 11 years old or younger in the household – a 7 percent increase from Summer 2008. Online adults with children under age 12 in the household were 1.7 times more likely to purchase a digital camcorder.

Jack Spends More Time Viewing Videos than Jill

Online video viewership among 2-11 year olds was split evenly between boys and girls, with 5.1 million boys and 5.2 million girls viewing video online in May

Online video consumption between boys and girls was not so even. In May 2009, boys led in viewing and time spent: consuming 61 percent of video streams among children and comprising 57 percent of the time spent viewing videos.

Doug Anderson, EVP, Research & Development, Nielsen Consumer Panel Services

SUMMARY: From now until 2050, nearly all population growth worldwide will take place in less-developed countries. Overall, growth in the more-developed world has nearly halted and is expected to stay at very low levels for decades to come. Opportunities for growth, however, will be substantial for marketers able to reconfigure their product lines to meet the needs of struggling young families with many children.

In 2007, the Gini Index—a measure of income distribution—declined in the U.S. for the first time in nearly two decades. A Gini Index of zero, for example, means that everyone in the country earns the same amount and an index of 100 indicates that one person in the country earns all the money. Incomes in the U.S. have become increasingly uneven (i.e., the rich get richer) particularly from 1990 to 2000, during the heights of the bull market.

The only countries in the world with income distributions more skewed than the U.S. are in Africa, the Caribbean, and Central and South America. Most other countries in the more-developed world have far lower—or more equal—income distributions than the U.S., with countries in Northern Europe having the lowest indices (in the mid 20s) in the world. The chart below shows the Gini Index for the U.S. over time.

Income inequality will increase
Current world population trends suggest that income inequality will increase worldwide as nearly all population growth over the next 40 years will come from countries with the lowest incomes. After World War II, advances in public health, health care, and disease prevention enabled the less-developed world to begin to grow at a substantial rate. Many of these advances had been developed and implemented in the more-developed world over the prior hundred years, cutting infant mortality and extending life expectancies there. In the future, this trend will intensify.

From now until 2050, nearly all population growth worldwide will take place in less-developed countries (LDCs). Overall, growth in the more-developed world has nearly halted and is expected to stay at very low levels for decades to come.

Almost all of the meager growth in the more-developed world will come in the United States and Canada. But the majority of that growth will not come from natural growth (births minus deaths), but from immigrants coming from LDCs. LDCs will grow from 5.5 billion persons to 8.1 billion in 2050 (+47%), while the more-developed countries (MDCs) will grow at less than one-fifth of that rate. The chart below shows the projections and how the distribution of world population will change over the next several decades.

Live long and multiply
Better access to healthcare, cleaner water, better sanitation and more food have all served to decrease infant mortality in the less-developed world. Although fertility rates have been falling for several decades, they are still much higher in the less-developed world (with the exception of China) as compared with more-developed countries. These high rates, combined with increasing life expectancies will foster rapid population growth.

Rapid growth among young persons will further distinguish the distribution of population by age between MDCs and LDCs that is evident today. The two charts below show the population pyramid for MDCs and LDCs expected in 2010. Note that the largest age group in the more-developed countries is persons aged 45–49.

Every younger five-year age break includes fewer persons, meaning that each succeeding generation is smaller than the one that came before—and that populations will eventually begin to decline. Children aged 5–9 in MDCs are less than 75% of the number of persons aged 45–49. In less-developed countries, the population distribution is exactly opposite with the largest numbers in the younger age groups. No five-year group is larger than 0–4 year olds.

Extreme distinctions
To illustrate the impact of uneven population growth at a more concrete level, data from two countries with similarly-sized populations—Italy and the Democratic Republic of the Congo—reveal a massive disparity. While Italy has one of the lowest fertility rates in the world and an old and aging population, the Congo has one of the world’s highest fertility rates and an extraordinarily young and rapidly growing population.

Although Italy is a somewhat extreme example, it should serve as a wake-up call to marketers to begin thinking of creative ways to sell their products in a world made up of more-developed countries like Italy and less-developed countries like the Republic of the Congo.

The more-developed countries will continue to be good markets for consumer products, with purchasing power far higher than global averages. Their needs will certainly change as populations age and immigrants make up increasing shares, but they will remain strong viable marketplaces. They will not, however, be places to look to for growth. Populations and purchasing power will grow in North America, but will stagnate or begin to decline in most of the other more-developed countries.

Expansion opportunities abound
Opportunities for growth will increasingly fall outside the traditional strong markets for consumer products, to the “ Congos” of the world. These new markets will pose a variety of challenges for marketers. Since these countries are far less affluent, they will have dramatically reduced purchasing power as compared with the markets where most consumer products companies thrive.

Marketers that succeed will re-evaluate packaging and distribution methods in order to conform to the requirements of these markets. Package sizes, for example, will need to shrink as a way to keep prices down (see Sidebar, Know Thy Consumer—and Their Market ). Distribution of products will be much more difficult and more expensive. But for those able to reconfigure their product lines to meet the needs of struggling young families with many children, the opportunities for growth are substantial. Marketers who can sustain and grow their current footholds in these countries or establish new benchmarks for their products will see new consumers coming online at rates not seen in the more-developed world since the heyday of the Baby Boom.

Sources:

Population Reference Bureau – 2008 World Population Data Sheet

United Nations – World Population Prospects 2006 Revision