Potential Gold Mine : Firms Aim at ‘Graying’ of Marketplace

General Foods thinks it can make more money if it makes things easier for older Americans. So it is offering easier-to-unscrew jars for its Tang product, and it is using less glue in its Grape Nuts packaging to make the boxes easier to open.

General Foods is not the only company with such ideas. Roman Meal Co., realizing that some diet-conscious and older consumers prefer smaller portions, is test-marketing a 10-slice “half loaf” in Minneapolis.

Ramada Inns last year conducted a “senior alert” program designed to sensitize staff--from maintenance crews to hotel managers--to the needs of some older travelers.

For these companies and others, the “mature”--or over-50--market is a tempting one. After all, this is the group whose children have moved away and whose mortgages are paid. They are either at the apex of their earning power, or they are collecting payments from one or more retirement plans. Regardless of their financial status, they are unencumbered by most of the responsibilities that have kept them strapped for years.

Number Over 65 Grows

And they have brought about a “graying” of the marketplace for the products of American business. Last year, the number of persons over 65 exceeded the ranks of teen-agers for the first time, according to the congressional Office of Technology Assessment.

The mature market constitutes a potential gold mine of spending power, with an estimated $500 billion in income held by the 61 million Americans over the age of 50.

Despite the notable marketing efforts taken by some leading firms, however, many companies remain confused, sometimes even fearful, of trying to tap into what at first glance appears to be a market with vast financial potential.

Some worry that they will offend customers with campaigns that bring to mind the most negative aspects of getting older--like sickness and senility--and that their products will be associated with an image of the “Geritol set.”

Await First Bold Move

Many companies are waiting for someone else to make the first bold move. Others are stepping into the market gingerly and with little fanfare.

Manufacturers and advertisers “don’t realize the potential of this market and its sophistication,” lamented James E. Birren, director of the Andrus Gerontology Center at USC. Instead, he added, many companies mistakenly cling to “one face of aging, the downer side, which regards them (mature consumers) as unhealthy and lonely.”

New York gerontologist and market analyst Jane Porcino agrees. “We’ve added 30 years to our lives, but the market hasn’t caught up with that fact yet,” she said. “Somehow people will have to tap that market--how they should do it is not obvious yet.”

In the words of an executive for Campbell Soup Co., which started marketing a line of low-sodium soups last year, “it’s an evolution, not a revolution, at this point.”

Leading one of the most auspicious expeditions to date into the market is St. Louis-based Southwestern Bell Media Inc., which distributes the Yellow Pages and plans to introduce a “Silver Pages” telephone directory in select cities across the nation this summer, listing businesses and organizations offering discounts and services for the mature market.

The Silver Pages also will include a listing of government programs for senior citizens and their phone numbers, articles and editorials and the classifieds, many of them printed in large type.

Ron Jennings, the company’s vice president-general manager, said the firm had been exploring the possibility of developing specialty directory products for several years and selected the senior market (for those 60 and older) because of its size--and economic potential.

Suggestions on Cars

Ford Motor Co. has formed a committee of retirees to meet regularly and offer suggestions for new car models.

“This panel meets a few times each year,” said Mike Davis, a special markets director at Ford, examining such matters as “how easily door handles and windows will function with arthritic hands.”

Sears, Roebuck & Co. has started a new membership organization for persons over 55, Mature Outlook, which has its own magazine and offers services such as special insurance plans and discounted pharmaceutical products.

International Games Inc. sells a card game, Skip-Bo, which uses cards emblazoned with large colored numbers that enables up to four players to test their skill, strategy and luck. The parlor game, originally designed for any age group, has sold so well among customers over 50--especially in retirement communities--that the company has chosen to target this group in its advertising campaigns, a company spokesman said.

Some ‘Feel Insulted’

“It’s a touchy job designing games for that age group that don’t appear too cutesy or childish,” said Jeff Conred, a spokesman for International Games. “They say they feel insulted by what appear to be kiddy card games.”

Based on its own national marketing surveys showing that persons over 50 and retired workers are moving out of large homes and into apartments or smaller homes in need of improvements, K mart Corp. is enlarging its kitchenware, houseware and crafts departments in all of its stores.

“The over-55 market is huge right now,” said Susan Feinberg, K mart’s manager of economic and consumer analysis. “The key is to recognize that, economically, seniors are not all poor; in fact, many have high discretionary incomes.”

Efforts to reach the mature market, though, are not always rousing successes. Campbell Soup took a lead in testing the older market last year when it pitched a host of new low-salt products--from spaghetti sauce to soups to pickles--that it hoped mature customers, as well as the diet-conscious, would find irresistible.

It began as a modest effort. For example, the company’s low-salt soups account for only 1% of the 80 million cases that the company distributes each year. But the size of the potential market portended large profits if the items caught on.

The consumer response so far has been lukewarm, said Charles Battista, marketing manager for Campbell. For now, he said, Campbell Soup, like many businesses, will continue to focus on a proven--and more lucrative--consumer base, namely young and middle-aged professionals and the generation of postwar Baby Boomers.

But the marketing campaigns directed at an older age group persist. Denny’s restaurants, in its first direct advertising pitch to the mature market, will tell older customers this spring that “we deal in service, you should expect that, and we do it at Denny’s,” said Keith Frohreich, the company’s vice president of marketing. The firm’s new ads will be placed in a host of magazines with titles such as Modern Maturity, Dynamic Years, Golden Years and 50 Plus.

“We’re proud of Denny’s (for targeting mature customers),” said Tory Abel, an advertising agent for Modern Maturity, which has 10 million subscribers and is published by the Washington-based American Assn. of Retired Persons. “It’s a small step for the company but a giant step for the market.”

Abel, for one, said she finds it frustrating trying to convince reluctant corporate executives that there is more to the mature market than anti-wrinkle creams or hair dye.

New York gerontologist Porcino said part of the problem in cultivating this market is that the definition of “old age” is changing almost daily. For example, she said the commonly held image of a grandmother in the kitchen baking cookies is out of date.

Porcino would prefer to see a more appealing image--one that projects positive possibilities for the future. That image, she said, “is of a woman about 75 boarding an airplane with a tennis racket in her hand or a school bag on her arm--the sensuous grandmother.”

‘Laxatives, Dentures’ Ads

To facilitate that image change, Modern Maturity recently made a dramatic change in its format. For 25 years, it merely served as a glorified newsletter for 25 million persons over the age of 50, who paid $5 a year to join the association of retired persons and receive services ranging from such things as insurance, travel packages and special discounts. But in 1980, the magazine, which previously had not carried any advertisements and had been funded by membership dues only, changed direction by upgrading its editorial content and opening its pages to advertising.

At that time, Abel recalled with a grimace, first-comers included “ads for laxatives, dentures, wheelchairs, funeral homes, alarm systems and even (an ultra-safe) self-defense weapon that shot hot pepper sauce.”

Dissatisfied with the gloomy image of old age that these ads projected, the magazine implemented strict restrictions that rejected all but “upbeat” ads portraying a more positive image. As a result, Abel said, “we were able to present a better environment for others to advertise in.”

Today, she said, “you won’t find wheelchairs or blood pressure machines in Modern Maturity.” Instead, the pages are filled with bright, smiling, gray-headed faces extolling the virtues of big cars, decaffeinated coffee, low-calorie maple syrup and no-salt spaghetti sauce--not to mention vacation opportunities in Florida, Missouri and Alaska.

In fact, the faces that advertisers are providing to push their products in many other general-readership magazines are slowly growing older to match the changing face of an aging society. Glamorous silver-haired models swathed in furs--rather than nubile teen-agers cavorting around in bikinis--are used to promote luxury items, cosmetics and food products.

One of the brightest faces to be found in the pages of magazines geared toward an older audience belongs to Kaylan Pickford, 54.

“Less than a decade ago, the only work I could find was in the area of what I call pharmaceuticals--hemorrhoid and arthritis remedies, you know?” she said. Although things are changing for the better, she added, “until fashion starts advertising and showing off clothes on mid-life women and not just 19-year-olds, there won’t be substantial changes in the market--or substantial work for (middle-aged) models.”

Judith Langer, a market analyst in New York, agrees. She also pointed out that many new products and services aimed at mature consumers benefit other groups as well.

“The stereotype that they (mature consumers) are settled, conservative and won’t try anything new is wrong,” Langer said.

Yet Langer said many of her corporate clients continue to “misperceive the older consumer.” For example, she said, “we did a study on arthritis, and they (corporate clients) expected to find retired, sedentary people.” Instead, “we found vibrant people, still working and wanting to have active life styles.”

Idea Not Embraced

That view has not been embraced--at least publicly--by many advertisers and corporations.

For example, auto makers “don’t want to admit it, but around 40% of all new cars are sold to people over 50 years of age,” said John Hamphill, an analyst with J. D. Powers & Associates, which monitors trends in the U.S. automobile industry. “The worst thing that can happen is to have your car labeled as an ‘old person’s car.’ ”

For this reason, Hamphill said, the major auto makers aim most of their advertising at young and middle-aged customers who will, they hope, stay with the company’s products for the rest of their lives.

Similarly, many department stores prefer to stick close by their younger customers.

For example, Becky Powell, a spokeswoman for the Sanger Harris department store in Dallas, said that, although persons over 50 are “obviously important to retailers . . . right now, we are operating with our energies focused on the . . . Baby Boomer generation.”

St. Louis-based May Department Stores Co. is an exception. In certain stores, including one in downtown Los Angeles, the company has set aside floor space for Oasis Centers, where elderly shoppers socialize with peers and take self-improvement classes in a variety of subjects.

Exercises, Art Lessons

Between the painting, dancing and sculpting lessons, aerobic exercises and free blood pressure examinations, Oasis members are given information on special store discounts and coming sales.

“These people are (consumer) traffic and they bring a lot of additional traffic into the stores,” said Marylen Mann, who founded May Co.’s first Oasis Center at a St. Louis unit in 1978. “There is no doubt about the fact they increase sales.”

Thus far, few large department store chains have been willing to follow May Co.’s lead. Many feel that the market simply is not ready to venture too far from mainstay, younger customers.

“Earning a reputation for going overboard too soon with senior citizens,” said a 60-year-old executive at one of May Co.’s competitors in Los Angeles, “could damage your business with younger customers.”

In the retail industry, “things take time to catch on. (Nobody) wants to get burned for being ahead of their time,” he said.

“There may be gold out there (in the mature market), but as far as getting the wagons rolling--it’s not happening.”