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Highlights: Online Survey of 150 Boomers How did we get into this mess? 9 Individual Boomer Profiles The End of the World as We Know It?

Six Major Themes/Dimensions: 1. Budgetary Restraint 2. Institutional Antipathy 3. Liberal Antipathy 4. Slippage 5. Credit Card Avoidance 6. The Blame Game

A Less Than Idyllic Retirement 33% of respondents responded “Frankly I don’t ever think I can afford to retire” 42% responded, “Before the economy turned, I thought I was fine. Now I’m not sure.” 17% responded, “I plan to work until I drop because I have to.” Only 21% responded, “Between by 401K, Personal Assets, Home and Social Security, I’ll be fine.”

Impoverished Millionaires. Of Respondents claiming net worth of $1MM-$5MM (including home equity): 16% classified themselves as “Compromised/Poor” POST-Downturn 33% were worried about their jobs 26% were uncomfortable about being able to make their mortgage payments going forward 47% weren’t confident about their retirement plans POST-Downturn

What They’re Saying: On Retirement: “ The idea of retirement has become further and further away.” “ I have enough to live on, but not to retire.” “ I will not be able to retire and maintain my present life style.” “ As a Texas teacher, my retirement pension will be appx. $3900 per month before taxes and medical insurance. Retirement becomes a joke.” “ I have no retirement plan. We have a little savings and that’s it. I will work until I can’t and die.”

The Socio-Tectonomic Shift 76% of respondents classified themselves as “Comfortable, Affluent or Rich” PRE-Downturn . Only 42% classified themselves as “Comfortable/Affluent/Rich” POST-Downturn . Only 7% classified themselves as “ Compromised/Poor” PRE-Downturn. 32% classified themselves as “Compromised/Poor” POST- Downturn.

The Natives Are Angry 65% of respondents either “Tremendously ” or “Very” Disillusioned with business and government leaders 66% “Furious” at Mortgage Companies 53% “Furious” at Investment Banks/Hedge Funds 49% “Furious” at Wall St. 43% “Furious” at Large Multinational Banks 39% “Furious” at Bush Administration

What They’re Saying: On Blame: “ Really mad at Wall St., big banks, investment firms and mortgage companies. They were all very responsible.” “ Treating homes as casino chips was a poor idea, and packaging loans into traded derivatives was destructive.” “ Small banks that stuck to the tried and true are fine today.” “ I’ve been fiscally responsible and now I’m supporting the slackers.” “ I witnessed the rampant greed and puffery led to the current credit/mortgage situation….there were few controls and zero accountability.” “ Most people in government and executive positions are immoral – until that changes our country will go downhill. ‘The Fall of Rome.’”

Employment Angst. 43% of Total Respondents have some sort of “issue” with their employment status 13% work for big companies and are worried about their jobs 2% are public employees and worried about their jobs 5% have recently been laid off 21% are self-employed and describe business as “not so good” 2% have to hold down more than one job to get by

Consumption Consequences: Recent Consumption Changes Three types of spending patterns emerge as a result of the Downturn: Luxury Items: Consumers plan to either “eliminate completely/significantly cutback” on Vacations (46%), Wardrobe (41%), Restaurant Meals (41%) and Leisure Activities (32%) “ Cheap Thrills”: Consumers plan to either “increase” or make “no change” to DVD/Premium Cable (63%), Movies(51%) and HBA (47%) “ Essentials” : Consumers plan to either “increase” or make “no change” to purchases of Med/Pharma (80%), Groceries (48%), Alcohol/Tobacco (56%).

Credit Cards = Dinosaurs? 32% of respondents reported Heavy Usage/Reliance on Credit Cards PRIOR to the Downturn. Only 15% anticipated Heavy Usage/Reliance on Credit Cards in the FUTURE – a 53% decline. 28% reported that they used Credit Cards Sparingly/Not at All PRIOR to the Downturn. 51% reported that they planned on using Credit Cards Sparingly/Not at All n the FUTURE – an 82% increase . According to the open-ended responses, many respondents indicated that they use credit cards only for convenience/bonus points with very little revolve .

What They’re Saying: On Employment and Consumption Patterns: “ Both my husband and I had jobs eliminated last year.” “ Husband had to fire half of his department and is seeking to take package and leave before company’s benefits decrease.” “ I have cut up most of my cards. I used to pay them off when extra money came in but then the extra money stopped. I found myself with $28K in credit card bills.” “ They decreased my limits on my cards and increased my finance charges. I have decided not to pay.” “ Haven’t been to the beauty salon for nearly a year. I’ve been cutting my own hair and it isn’t pretty.” “ All non-essential expenses were reduced significantly or eliminated.” “ The 46 inch flat screen will have to wait… A bigger TV doesn’t make me happy.” “ We’re going to cut back – Anna Wintour was recently quoted at an ostentatious fashion show: ‘That’s so Dubai.’ In other words: ‘that’s so over.’”

Going Forward: Spenders or Spendthrifts? Not one respondent expects to increase their level previous level of spending when the economy rebounds. Only 27% claim that they will return to their previous level of spending 65% claim that they will either cut back “slightly” or “significantly” from their previous level of spending when the economy rebounds. 27% 44% 21%

Lifestyle Issues: Housing Situation 83% of respondents claim a decrease in home value of 10%+ vs. a year ago; 44% claim a 10%-30% decline. 39% indicate some level of discomfort in being able to stay in their homes going forward.

Lifestyle Issues: Stress and Activity Levels Response 74% of Respondents claimed either a “Modest,” “Fair Amount” or “Significant” amount of Added Stress/Anxiety due to the Downturn. 34% claimed a “Significant” or “Overwhelming” amount of Stress/Anxiety “ Exercise/Workout/Jogging ” (26%) and “Yoga/Meditation” (11%) exhibited the largest activity increases in response to the Downturn Activity Level Increases Due to Downturn

What They’re Saying: On Declining Home Values and Stress: “ Pity the people who lost their investments plus the house decreases and they if they lose their job – times will be very tough.” “ If I lose my job, my house will be foreclosed within two months.” “ The only way to get assistance is to stop paying the mortgage, which I don’t want to do. “ I always worry about my job.” “ I definitely feel more stressed about my retirement savings. I’m hoping I won’t have to work until I’m 80! “ I’m mad as hell and I don’t know who to complain to.”

How Can Boomers Possibly Survive? Cut Back on Spending NOW! Fill in the GAP. Re-Invent Yourself Seek Out Affordable Living Alternatives

Baby Boomer Marketing Opportunities

Marketing Opportunities: Greed is Gone : The era of excess is over in reality but most importantly, emotionally. Emphasis on “the good life” – unless very narrowly targeted -- will not resonate with most consumers and will most likely turn them off. Popularize Populism : Any marketing products/communications that bypass the grasp of large institutions on individuals lives should resonate. Examples: social networking programs, cooperatives, credit unions, regional/local banks, etc. Solutions, Not Celebration : Consumers want hard-nosed concrete solutions to their problems. How can I afford to retire? How can I ever pay for college? How can I afford to keep food on the table? What happens if I lose my job? Companies that develop and communicate solutions to these and other problems will resonate with the masses.

Marketing Opportunities (cont’d): De-Stress the Distress : Short term opportunity to position a variety of products/services as stress-relievers. Examples: health clubs, meditation regimens, certain food products, short term getaways, etc Programs for the Self-Employed : 35% of respondents classify themselves as self-employed. Opportunity to develop innovative programs that cater to this group

www.babyboomerbust.net www.Brandloft.com

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Transformation in Progress: A Report from the Trenches - Roger Chiocchi

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