Do brand owners have tunnel vision when it comes to youth? - Consumer Intel

It’s fair to say that in today’s beverage alcohol market, youth reigns supreme – or at least, that’s what advertising campaigns from some of the world’s biggest drinks brands would have us believe. Despite significant strides being made to diversify brands’ target demographics, the images, literature and marketing speak we’re so used to still largely focuses on the under-50s.

This is not a new phenomenon; over the years, as new generations have come of legal drinking age (LDA), brands have spied an opportunity to convert a new army of loyalists. There’s a pragmatic reason for this: at the risk of sounding morbid, investing in younger drinkers can reap longer-term rewards. There’s also a widespread perception of younger drinkers as being more adventurous and premium-orientated.

However, it’s no secret that Millennial and, particularly, Gen Z drinkers have more moderate lifestyles with a keener focus on health & wellness than their predecessors. At the same time, studies have shown that widespread perceptions of older consumers – so-called ‘active agers’ – may not be all that accurate.

Women drive rise in consumption among Gen X and Boomers

According to a 2019 Rabobank study centred around US consumers, people aged over 50 account for 39% of alcohol consumption, up from 29% in 2007. The Baby Boomer generation is vast, with consumers aged 65-plus living longer and routinely including alcohol as part of their “forever young” lifestyles, the report states.

“Older Gen Xers came of age at a time when, at least in the US, beverage alcohol consumption was at an all-time high and that created this thing called a ‘cohort effect’,” says the report’s author, Bourcard Nesin, Rabobank’s analyst for beverage, tech & e-commerce. “These older generations in the US are simply drinking more than previous generations did at the same age.

“This is holding true as they get older.”

Nesin adds that women are driving increased consumption among Boomers, thanks to a “trend of empowerment”, which means they are more autonomous, educated, professionally successful and wealthy.

The same data set cited in the report is not available post-pandemic but, according to Nesin, the trends remain largely unchanged. “These trends are not going to stop, and they’re not going to be dramatically impacted by the pandemic,” he says.

Nesin also notes that while it’s often assumed that older consumers are set in their ways and therefore not open to new brands or products, this is not supported by evidence, which shows these drinkers are actively trading up to more premium offerings.

While they are overwhelmingly moderate drinkers, per capita alcohol spend among the over-65s in the US has doubled since 2004, according to Rabobank.

Brands fail to connect with Millennials and Gen Z drinkers

However, Nesin makes a pertinent observation in the report: the fact that so many brands and categories rely on older consumers to drive sales – despite the vast marketing budgets allocated to the recruitment of younger drinkers – suggests they are failing to connect with Millennial and Gen Z consumers.

Taking wine as a prime example, Nesin states that as the Boomer generation has started to shrink, so too has the total wine category. The same can be said of some of the world’s established spirits brands, he says.

According to Michael Scantlebury, founder & ECD of creative agency Impero, there is a lack of differentiation among alcohol brands’ strategies. “We have the advantage of working across multiple brands in multiple categories – gin, whisky, vodka, beer, RTDs – and we see different brands with the same consumer profiles and only slightly different descriptions.

“Ten years ago it was all about the Millennial craft-hunters looking for engaging experiences. And over the last few years, Gen Z has gone from a footnote, to the appendix, to the main focus in many brand strategy decks.”

Despite their ability to spend – and their love of alcohol – Scantlebury says he is yet to encounter a company actively targeting Boomers and Gen Xers. However, he believes it makes sense that, in an age-restricted category, alcohol brands are continuously targeting the next generation of consumers.

Furthermore, in this age of influence, older consumers – even older Millennials – have less cultural cachet. Youthful lifestyles remain aspirational, which is reflected in the iconography and messaging across a wealth of consumer goods industries. Reason dictates, therefore, that explicitly targeting younger consumers could ricochet and capture older demographics – the same would not be true in reverse, though.

Rise of the ‘consumer tribe’ – defining audience by age ‘systematically lazy’

Ultimately, Scantlebury says defining an audience by age is a “systematically lazy approach”, and tribal marketing will reap bigger rewards.

“The biggest brands in any category should appeal to psychographic traits, not demographic truths. Jack Daniel’s is drunk by anyone wanting to feel a bit dangerous; Jameson is drunk by those who don’t take life (and whiskey) too seriously. These human traits span beyond demographics.”

Scantlebury also highlights Pernod Ricard’s Chivas blended scotch, which has “focused on an influential younger audience, who share a belief and attitude with a large multi-demographic consumer pool”. He adds: “Demographic-only thinking is restrictive. It will limit your brand’s potential. It would be more effective to narrow the creative target to a connected [and] influential consumer tribe that shares an attitude with the largest possible consumer pool. Then, your marketing might be able to amplify that attitude to as many consumers as possible.

“At the end of the day, all alcohol brands should try and win over anyone with a mouth that likes a drink.”

Similarly, Nesin notes that “there are other dynamics of identity that are perhaps more important than age”. In marketing, conventional wisdom suggests that consumers need to see themselves reflected in the brands they buy. That may be true, but it seems brands have an unduly narrow view of who these older consumers are and what’s important to them.

“There’s a real opportunity for us to make sure these [older] consumers know that we care about them and we want their money,” says Nesin. “There’s no doubt in my mind that the companies who take advantage of this are going to feel real success .

“They’re also going to be early movers in a segment of consumers that’s being underserved, if not completely ignored.”