September 16, 2008
Boom, Bust & Echo: Profiting from the Demographic Shift in the 21st Century
Ever wonder what made the Rolling Stones the legendary icons they became? Mick’s swagger? Solid musical chops? That Keith Richards is disintegrating before our very eyes, yet can still coax poetry from his guitar strings? Possibly…but it’s more likely that they were in the right place at the right time. Extrapolating from the findings of Dr. David K. Foot, Harvard-educated professor of economics, award-winning teacher at the University of Toronto, author of the phenomenal best-seller Boom, Bust & Echo: Profiting from the Demographic Shift in the 21st Century, and the most recent speaker at the PMCQ, the Stones’ audience was likely ready and waiting for the boys who couldn’t “get no satisfaction” to arrive. It’s all about demographics, or in Dr. Foot’s words, it’s “all about people”.
We spend countless hours and dollars conjuring up clever marketing campaigns, when in fact, “demographics explain two-thirds of everything”. In other words, we’d save a lot of time and money if we’d look at the people who comprise the largest, most influential group of the day and market to them.
By virtue of our birth year, each of us belongs to a particular demographic cohort. The well-known Baby Boomers (1947-1966) and their various subgroups like the Gen-Xers were undeniably the largest cohort in recent memory, meaning huge market expansion and opportunities for some, but tough times and fierce job competition for others depending on their position in the pack. However, from a marketing standpoint, this cohort was remarkable for its sheer numbers. Back to the example of the Rolling Stones: the fact that the Baby Boomers comprised the bulk of the Stones’ audience meant that, to paraphrase Dr. Foot, those five Brits didn’t have to be any good—all they had to do was show up!
The writer of this article finds herself in the Baby Bust cohort (1967-1979)—a rather fortunate group that has enjoyed more opportunity in terms of such things as schooling, lifestyle, and attention to social issues. Was it because we’re a brighter, more humanitarian lot? While I’d love to think so, the reality is not quite so flattering; according to Dr. Foot, there were simply fewer of us vying for spots in universities thanks to fewer babies born due to the advent of the birth-control pill, which also meant that we had more free time to spend dwelling on social issues of the day and coming up with idealistic solutions. Our scant Baby Bust numbers would likely have meant that had Mick and the boys made their debut during our day, they might have enjoyed moderate success, but nothing like the enduring success they have enjoyed by having a huge audience to age right along with them. They would probably have made a fair sized splash on this side of the pond, but our numbers would not have sustained them in the long-term (speaking of Duran Duran, anyone know what they’re up to today?).
As for the Echo segment of the Boom, Bust & Echo title, this group born in the years 1980-1995 are the children of the Boomers. This group is part of the mini-boom that turned five new musically inclined (or cleverly marketed) British exports called the Spice Girls into household names. That’s what happens when 13-year-old girls drive the market.—and when their Boomer parents are the ones buying Spice Girls CDs for their kids. However, Dr. Foot reminded us that the thing about all of these cohorts is that they are predictable in one key way: every year they will get one year older. Bearing this in mind, we can reasonably predict when a certain group will place a greater or lesser demand on a given area such as recreational activities (golf, anyone?), health care, alcohol consumption (as one gets older, one typically drinks less, but drinks better—think Scotch over Sleeman’s), or school enrolment.
Dr. Foot is clearly a kind of rock star in his own right in the world of Canadian economics. His work in demographics holds the answers to such questions as when (now) would be the best time to hire members from which cohort (Echo kids), and why. For those members of the PMCQ wanting to unlock the secrets of the future of pharmaceutical marketing from a demographics standpoint…well, all you had to do was “show up” for Dr. Foot’s engaging and insightful talk. But for those of you who couldn’t, two words: falls and pneumonia. But as for the when and why, you’ll have ask someone who was there!