First mocked as slackers, then cast aside in the rush to get to those desirable, hip millennials, the men and women of Generation X (remember them?) have quietly become respectable, adult members of the community (hey, some of them are even middle-aged). In fact, a new Shullman Pulse study says these 34- to 48-year-olds are poised to replace the baby boomers as a cash cow for marketers.
Are you ready to capture this untapped goldmine? To do it, here’s what you need to know about Gen X.
Money to Burn
Gen X’s spending power is disproportionate to their numbers. In the United States, the 60 million members of Generation X constitute 25 percent of all adults—in sheer numbers, they’re the third-largest generation (after boomers and millennials). But Gen X has more spending power than any other generation, with 29 percent of estimated net worth dollars and 31 percent of total income dollars.
The Shullman Pulse study divided Gen Xers into two groups:
- "Upscale" members either have a household income of more than $250,000 annually (about 36 percent of upscale Gen Xers, or 2 million adults) or a personal net worth over $1 million (64 percent of upscale Gen Xers, or about 4 million adults). Overall, upscale Gen Xers account for about 10 percent of all Gen Xers or 6 million adults.
- "Mass market" Gen Xers (those who don’t fit the upscale definition) still have higher average incomes than their baby boomer or millennial counterparts.
Sunny (With a Chance of Clouds)
Overall, Gen Xers are currently content and optimistic about the future. Two-thirds reported being “satisfied” or “very satisfied” with their lives; 77 percent of upscale Gen Xers and 68 percent of mass-market Gen Xers are confident they’ll be better off financially in the next 12 months.
That doesn’t mean they’re seeing the world through rose-colored glasses, however. Upscale Gen Xers are worried about crime, climate change and their own health (surprisingly, even more than baby boomers are). Mass-market Gen Xers also worry about their health, but they're more concerned than their upscale counterparts with the rising cost of living and being able to save enough for retirement. And speaking of saving ...
Saving for a Rainy Day
Perhaps one reason Gen X expects to be better off financially a year from now is that saving money is a huge priority for this generation. More than nine out of 10 upscale Gen Xers say they plan to save more than or about the same amount in the next 12 months as in the past 12 months; eight out of 10 mass-market Gen Xers say the same.
But what are they saving for? Fifty percent of all Gen Xers (compared with just 20 percent of adults overall) say providing for their children’s college costs is a major goal. They’re also more likely than the other demographic groups to focus on five other key financial goals: becoming financially independent, buying a home, minimizing taxes, providing an estate for their heirs and starting a business. Since most of these require saving substantial amounts, it's no wonder Gen X is socking money away.
But they’re not socking it all away. About two-thirds of upscale Gen Xers and half of mass-market Gen Xers plan to travel for pleasure in the next 12 months. Half of upscale Gen Xers and about one-third of mass-market Gen Xers plan to buy luxury products. Last, but not least, fine wines and premium beers are popular purchases.
Winning With This Target Market
If you'd like to market to Gen Xers, you need to understand they’re a bit of a conundrum. But you can appeal to:
- Their desire to provide for their families. Whether you’re selling home furnishings, exotic vacations or luxury watches, pitching your products and services as lasting values, once-in-a-lifetime experiences or heirlooms to hand down will resonate with this generation.
- Their desire to take care of themselves. If you’ve marketed products or services to health-conscious baby boomers, try expanding your target market to Gen X as well. Healthy foods, supplements, exercise equipment and apparel, weight-loss products, and fitness classes are just some of the things that appeal to this generation as they hit middle age.
- Their desire to play it safe. Worried about crime and climate change, stressed about saving for retirement or leaving a worthy inheritance, Gen Xers are no longer the “extreme” generation of the X Games—they want reassurance and security. Emphasize how your products and services can protect their homes/the planet/their families/their hard-earned money, and you’ll win them over.
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