Baby Boomer Segmentation:

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Overview ACNielsen recently completed the 15th edition of its annual Trade Promotion Practices Study which has traced industry promotion budget and allocation trends on the manufacturer side for 15 years, and corresponding retailer practices for nine years. The longitudinal view of spending habits and preferences affords unique insights into the ebb and flow of promotional methods through time, and an enlightened look at the similarities and differences between these trade partners. Conducted via the Internet, the online survey polled senior sales and marketing executives from 61 manufacturers and 38 retailer organizations. The electronic field work was supplemented with in-depth telephone interviews to more fully develop areas of special interest. The Trade Promotion Practices Study has been distributed to ACNielsen clients and is available for purchase on our website at http://www.acnielsen.com/store. Benchmarking performance Perennial favorite topics up for debate include the efficacy of frequent shopper programs and an assessment of which elements in the category management tool kit (assortment planning, promotional planning, shelf management, category business planning, everyday low pricing, frequent shopper/loyalty programs, micro-merchandising and micro-marketing) have gained or lost favor in the calendar year. A matter of opinion While retailers and manufacturers disagreed on any number of issues ranging from the sufficiency of trade promotion dollars to the effectiveness of shelf management, there were five areas of accord. The following topics were identified by both groups as critical success factors important to their business: 1. understanding consumers 2. new product introductions/implementation 3. category management 4. promotion efficiency/effectiveness 5. variety and assortment Additionally, each faction identified important subjects specific to their operations. In the case of retailers, those subjects included private label activities and customer loyalty/retention programs. In the case of manufacturers, those subjects included trade partners, vendor relationships and category management. Tailoring content With study input available to guide editorial selections, the Fall/Winter issue of Consumer Insight magazine serves up a number of articles that directly address the top-ranked concerns of retailers and manufacturers. When it comes to understanding consumers (factor 1), the publication places the two largest age cohorts in the U.S. squarely in the crosshairs—Baby Boomers and Millennials. The article titled “Baby Boomer Segmentation: Eight is Enough” introduces a robust segmentation model from ACNielsen Homescan & Spectra, based on the single most influential determinant of consumer purchase behavior— household composition, and in particular, presence of children in the home. The mantra “it’s all good” describes the teen scene in the article titled “Tune into Teens” for marketers who take the time to understand the zeitgeist of Millennials and their propensity for electronic multi-tasking. While teens may not have the bank accounts to purchase big ticket items, their influence over household spending decisions is undeniable. New product intros Opening a window onto the global new product scene (factor 2), the article titled “Global Household Product Sales: Innovative Items Clean Up” analyzes the packaging, ingredient and social trends that contribute to successful new product uptake. Cleaning products with oxidizing properties swept the worldwide sales ratings, along with so-called system approaches to cleaning like the innovative Swiffer line. C.O.D.E. breakers For a comprehensive view of consumer-driven micromarketing, readers will want to spend time with the article titled “Cracking the Retail C.O.D.E.”, which touches on each of the critical success factors from the Trade Promotion Practices Study. Expanded, the acronym C.O.D.E. stands for 2 Fall/Winter 2006
1. Consumer Profiling—accurately captures the demographic profile of the brand’s consumer. 2. Opportunity Gapping—quantifies store-level opportunities based on consumer demand potential and diagnoses the prospect. 3. Dynamic Clustering—groups similar stores using multiple store attributes, including shopper demographics, the competitive set, and upside opportunity. 4. Executing for the Consumer—takes findings from steps 1–3 and develops store-level tactical plans, giving the field force the right information to optimize in-store presence. Forward-looking insights With winter and the annual Consumer and Market Trends Report release approaching, more than the ambient temperature is dropping. The VNU Retailer Sentiment Index (RSI) saw a continuation of the downtrend which started in January 2005. Comprising monthly polls of roughly 500 retailers about current and future economic conditions, the VNU Retailer Sentiment Index also takes into account indicators such as store openings, hiring, earnings and general economic trends, synthesizing the input into a comprehensive view of current and future conditions. Traditionally, retailers cited the competitive environment as their top concern since the inception of the RSI. By midyear 2006, for the first time, the overall economy knocked competition out of the top spot. Social responsibility This year’s Consumer and Market Trends Report exhibits a decidedly altruistic bent, delivered by two articles. One article outlines the rise in organic products and the downstream influence of Wal-Mart’s green commitment on the environment. The second article discusses how corporate sustainability and consumer pressure for environmental responsibility is sweeping through board rooms. True blue Segueing from the green theme, the Consumer and Market Trends Report will also cover the subject of true blue customers in a detailed article on the subject of loyalty marketing. The article walks through a framework for integrating a broad range of data from loyalty programs and POS numbers, to demographic profiles, attitudinal studies, share of wallet and promotional responsiveness to convert regular shoppers into loyal, high value customers. Classic updates Now in its tenth year, the Consumer and Market Trends Report will include updates on classic measures of industry performance including channel blurring and category summaries. The channel blurring article investigates the impact of consolidation on channel dominance and the behavior of valuable multi-channel shoppers, while the category review article examines results from the convenience channel. Pricing it right Price compression and assortment expansion are two opposing forces that define the fast-moving consumer goods climate of today. From our custom analytical group comes a detailed discussion of a repertoire modeling approach for simulating the impact of a price change on volume, share, revenue and profit. It’s all about you By lifting the curtain on this and future Consumer Insight articles, we hope to have piqued your interest in the publication, while demonstrating that we practice what we preach. You are our readers. You are our customers. And our goal is to provide customer-centric editorial content that addresses the fundamental needs of your business. To make sure that we stay on point, you can e-mail our editor at ConsumerInsight@acnielsen.com or contact your client service representative any time to make a suggestion that will improve our core product set or thought leadership publications. We’re listening. C i 3
Page 1 and 2: CONSUMER Insights today for tomorro
Page 3: 4 On the Cover: Baby Boomer Segment
Page 8 and 9: Simply put, there is no shared cult
Page 10 and 11: Chart 4: Segmenting Baby Boomer hou
Page 12 and 13: Chart 5: New family configurations
Page 14: Global Household Product Sales: Inn
Page 17 and 18: Stepping Outside Your Own Borders?
Page 19 and 20: garbage bag sales (40%), almost env
Page 21 and 22: Identify and Target High Opportunit
Page 24 and 25: Equally different All teens are not
Page 26 and 27: Aligning the cross hairs For market
Page 28 and 29: While we can only speculate about w
Page 30: Employee Empowerment: The Key to Ca
Page 33 and 34: The Answer for Busy Professionals S
Page 35 and 36: Open your window to collaborative b
Page 38 and 39: Gas Price Hikes continued from page
Page 40 and 41: Concurrently, the competing warehou
Page 42: Chart 5: Rising gas prices will imp
Page 46 and 47: the potential demand. The result is
Page 48 and 49: 3. Store Attributes. These may rang
Page 50 and 51: Cracking the C.O.D.E. A Case Study
Page 52: Trendwatch Walk-In Retail Clinics:
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Track the New Health & Wellness Tre
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