Marketing to Age: What Artists Can Learn From Analysts

By The Age of Aging Archives
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Madison Avenue and Wall Street are both in Manhattan, but that's where the commonality has always ended. With two distinct identities — artistry versus analysis — neither industry has ever felt it had much to learn from the other. Cut to current day, and marketing is now awash in analytics and struggling with generational dynamics. For Madison Avenue, it might finally be time to do the unthinkable: to look to the financial services industry for creative inspiration.

If the two industries were to come together, they would discover that they share a common purpose. Both are in the business of generating growth for their clients. Bankers do it by making investments in financial instruments, while marketers do it by investing in media and messaging.

Where they differ, of course, is in how they do that. Bankers create a diversified portfolio of investments that is structured to optimize gains while mitigating risk. A typical portfolio might consist of a mix of high-growth, moderate, and conservative investments, balanced in a way that delivers reliable long-term growth. While marketers also diversify by deploying a balanced mix of media, they are diversifying with the purpose of reaching as many customers as efficiently as possible; they are not diversifying their investment to managerisk.

Risk is everywhere in marketing today, especially for those who are prioritizing millennials , a generation with enormous future potential, but also one that is highly enigmatic. Trying to figure out their personal values — the beliefs that influence their behavior and choices — is a vexing challenge. In this regard, the financial analysts have a message for the marketing artists: diversify to manage the inherent risk of marketing to this new generation.

Here's more advice to help you balance your generational marketing:

Don't over-emphasize one target audience . In their zeal to win first and win big with marketing's newest generation, many brands are placing sizeable bets on millennials. As a new audience that's still coming of age, millennials are marketing's equivalent of an emerging market. Although emerging markets can be a high-reward investment, they're also inherently risky because they're volatile; that is, there's more about them that's unknown than known.

Marketers are still finding their way with millennials and are now starting to realize that many of them are still five to 15 years away from their peak earning and spending years. So, while they represent the future of marketing, the future isn't here yet. Marketers may need to have millennials in their mix, but they would be smart to offset this generation's inherent risk by also targeting other more predictable generations.

Diversify to maximize gain and minimize loss. If millennials are marketing's equivalent of high-risk/high-reward investments, they should be balanced by cohorts such as Gen X (ages 40–51) and baby boomers (ages 52–70), who offer the potential for more moderate gains with conservative risk exposure. Not only are these potent generations, but they also have well-established tendencies, particularly the boomers. An analyst would think of baby boomers as the fixed-income component of a marketing portfolio; at 78 million strong and controlling upwards of 70 percent of the nation's disposable income, they are a rock-solid investment that will yield predictable returns.

Invest for the long-term . The abundance and allure of modern communication technology entice marketers to use the newest tools available to them. In this opportunistic and, at times, reactionary environment — one where expectations are higher than ever — short-term tactics are replacing long-term strategic thinking. When this happens, the focus shifts to building the business now at the expense of building the brand for the future. By contrast, smart financial analysts structure their investments around a sustained strategy and a known time frame. Because they stay the course, they almost always outperform the major indexes.

Wall Street Comes to Madison Avenue

There's an old investing adage that advises, "Trade the market you're given, not the one you want." The market that most brands want today is the emerging millennials, and the temptation to win with them is almost irresistible. And why not? They're the country's largest generation and earning their loyalty for a lifetime is priceless. But then, there's the other part of the adage. The market that brands are given today — the one they should be trading — is one made up of others too, including the generation with the most money: baby boomers.

If Madison Avenue were to take a hot tip from Wall Street, they would target a balanced portfolio of consumers, consisting of a mix of millennials, Gen X, and baby boomers, with the former offering a chance to speculate on future growth and the latter delivering predictable returns now.

While the artists would tell you that marketing to old folks is not nearly as fashionable as marketing to millennials, the analysts would remind us that all businesses are in the business of making money, and that objective is one that will never go out of style.

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