Baby boomers, the backbone of the tourism industry

When they were young, baby boomers sported peace signs. Today, they worry about the stock market and the chances of early retirement. Their travel curve will rise but will be difficult to profile.

General characteristics

• Among industrialized countries, Canada experienced the biggest baby boom.
• Mass retirement of boomers from 2010 to 2020; their median age will be 55 in 2010.
• 9.8 million boomers in Canada, or 33% of the population (Foot and Stoffman, 1999).
• 76 million boomers in the United States, or over 25% of the population (American Demographics, 2004).
• By the year 2010, the countries of the European Union will be home to 140 million people aged 50 and over (Austrian Institute of Economic Research).

Nothing new in their profile

• Enjoy high disposable income
• Tend to be stressed workaholics
• Demanding, quality-oriented
• Active, healthy and intent on staying young
• Interested in learning and new experiences
• Adventurous

Beyond age and income

It is easy to divide the population into segments according to age and income, but reality is more complex. Lifestyles and attitudes towards ageing are becoming important factors. Some people are healthy and fit at age 70, while others feel old at age 50. In Canada, a 50+ Communication Marketing study defined four segments among those aged 40-plus:

• the wealthy

  (21%) – satisfied with their financial situation, careful with money, thrifty, with a long-term attitude towards things, rather dissatisfied with their appearance and open to the idea of cosmetic surgery, see their health as an investment (good eating habits, exercising to stay fit);

• the enthusiasts

  (27%) – are more or less concerned about their financial situation, eternally optimistic, enjoy life's pleasures, open to taking job-related courses and continuing to work past retirement age, sensitive to the time factor (prefer one-stop shopping), often eat in restaurants for fun and to save time, more or less concerned with the state of their health (good food habits and exercising for fun);

• the careful

  (30%) – make independence a priority (living at home and driving one's car for as long as possible), interested in continuing to work post-retirement, worried about financial security and even more about their physical health, seeking durable products and discounts, with poor health habits (overweight, large proportion of smokers);

• the worriers

  (21%) – pessimistic with regard to their finances and physical appearance, looking for products to help them regain their youth both mentally and physically, feel a loss of energy, seek a good quality-price ratio, think they should improve their eating habits.

A wired clientele

In the United States in the 50-58 age group:

• 62% have access to the Internet. Of that number, 75% read the news online and 55% do information searches.
• 76% use a computer on a regular basis (Pew Internet & American Life Project).

In Quebec, in the 45-54 age group:

• 55.4% use the Internet on a weekly basis (Cefrio).

Baby boomers who travel

In the United States, boomers travel more and spend more than any other age category:

• 44% of all trips, or 241 million trips in 2002.
• US$491 per trip, excluding transportation (Travel Industry Association of America).

In France:

• 48.7% of 50-somethings make travelling a spending priority versus only 40.3% of the national average (INsee and Notre Temps magazine).

Coveted tourism products

• Growth of the high-end market.
• Gradual decline in travel to the south and to resorts in favour of adventure and ecotourism products (observation of wildlife in Costa Rica, travel to Irkutsk on the Trans-Siberian Railway).
• Increase in demand for cruises and diversification of this product with smaller craft offering quality trips to limited groups.
• Demand for packages and personally tailored vacations.
• Increase in passive activities (golf, walking, bird-watching, etc.) and cultural pursuits.
• Popularity of safe destinations.
• More frequent travel to nearby countries.
• Popularity of bus trips for tourists who want to leave responsibility behind and be pampered – low-kilometre itineraries to enable travellers to get to know certain regions in depth or tours to little-known countries.

Look for uneven growth

Expectations about the rising boomer travel curve will have to be revised. Although this clientele will be very sought after, it will not behave uniformly. Some boomers will go into semi-retirement, or take progressive retirement. Others will retire later, or have less money upon retiring than anticipated, for the following reasons:

• lower returns on pension funds, due to dropping share values and low interest rates;
• a growing disproportion in the number of pensioners to workers – money is being withdrawn from retirement funds faster than it can be put in because there are fewer workers to make contributions;
• recent corporate governance scandals have compromised employee pension plans;
• the government will probably raise the official retirement age;
• more and more workers will be asked to continue working because of their experience;
• many people already receiving pension benefits will return to work.

With today's longer life spans, people must make their post-retirement revenues last longer, which reduces annual income. Many fear that their pension plan will expire before they do.Sources:
– 50+ Communication Marketing. “Une étude marketing sur le marché des baby-boomers et des personnes âgées,” press release, April 28, 2004.
– La Presse canadienne. “Les baby-boomers rêvent maintenant d'une retraite progressive,” February 16, 2004.
– Research ALERT. “Leading-Edge Boomers Approach Senior Status, Changing the Face of Aging,” vol. 22, no. 8, April 16, 2004.
– Sarrasin, Bruno and Guy-Joffroy Lord. “L'évolution du tourisme international : une analyse prospective à l'horizon 2010,” Téoros, fall 2003, p. 5-9.