Basic Marketing: A Global Managerial Approach

Perreault−McCarthy: Basic

Marketing: A

Global−Managerial

Approach, 14/e

5. Demographic
   Dimensions of Global
   Consumer Markets

Text © The McGraw−Hill

Companies, 2002

148 Chapter 5

little left for discretionary purchases. If a single parent remarries, the family life cycle

may start over again.^21

Once children become teenagers, further shifts in spending occur. Teenagers eat

more, want to wear expensive clothes, and develop recreation and education needs

that are hard on the family budget. The parents—or, increasingly the single par-

ent—may be forced to reallocate expenditures to cover these expenses—spending

less on durable goods, such as appliances, automobiles, household goods, and hous-

ing. The fast-rising expense of sending a son or daughter to college can create a

major financial crisis.

For many firms, teens are an important and attractive market. The amount of

money involved may surprise you. America’s teens currently spend over $150 billion

a year and spending is growing at double-digit rates. Further, in today’s families with

a single parent or with two wage earners, teens play an increasingly important role

in shopping and shaping family purchases. With teens spending more money, they

are a target for many firms. For example, Siemens added an MP3 player to its wire-

less phone to help it win teen preference away from Nokia. Similarly, MasterCard is

targeting teens with its credit card promotions and Bausch & Lomb’s contact-lens

sales hit record levels when the firm refocused its marketing efforts on teens.^22

Another important category is the empty nesters—people whose children are

grown and who are now able to spend their money in other ways. Usually these

people are in the 50–64 age group. But this is an elusive group because some peo-

ple marry later and are still raising a family at this age. And in recent years lots of

empty nesters have been surprised when adult singles move back in to avoid the

big costs of housing.

Empty nesters are an attractive market for many items. They have paid for their

homes, and the big expenses of raising a family are behind them. They are more

interested in travel, small sports cars, and other things they couldn’t afford before.

Reallocation for
teenagers

Selling to the empty
nesters

Exhibit 5-9 Stages in Modern Family Life Cycles

Usual flow Recycled flow * Traditional family flow

Young

single*

Young

married

without

children*

Young

married with

children*

Middle-aged

married with

children*

Middle-aged

married without

dependent

children*

Older

unmarried*

Older

married*

Middle-aged

married

without

children

Young

divorced

without

children

Middle-aged

divorced

without

children

Middle-aged

divorced with

children

Young

divorced

(or single)

with children

Middle-aged

divorced without

dependent

children