“Follow the money” was made popular by the movie, “All The President’s Men.” The 1976 motion picture told the story of the Watergate scandal and President Nixon’s ultimate demise. Today, many investigations and political debates invoke this catchphrase. But the concept is also useful for thinking about your organization’s strategy. A crticial and often overlooked element of the target audience is their ability to purchase your product or service. Several imminent changes to the demographics of the U.S. may significantly impact your target audience.
The first significant demographic change is called “The Boomer Bust” by the author, speaker, and consultant, John Dini. The Baby Boomer generation started post-World War II. With a booming economy after the war, the birth rate in the United States dramatically increased (later described as a ‘boom.’) The 76 million Americans born between 1946 and 1964 represents one of the largest generational groups.
The Boomers are known to be the wealthiest, most active and physically fit generation of any area. And according to Dini, they were also two to three times more likely to be entrepreneurs than any other generation. When these Boomers graduated from college, they had plenty of competition from other Boomers in the job marketplace. That’s part of the reason why so many Boomers became entrepreneurs.
The significant demographic change that is occurring today is the retirement of the Boomers. By 2029, the last of the Boomers will reach the retirement age of 65. You should consider two key takeaways from the Boomer retirement tidal wave: First, over 50% of the wealth in the U.S. will be in the hands of about 17% of the population – the Boomers. Second, many Boomer entrepreneurs will be looking to exit their businesses. How does your company’s strategy leverage the opportunities of the retiring Boomers?
The second significant demographic change that is occurring is the transfer of wealth from males to females. Multiple reasons are causing this transfer of assets; the first is that women outlive men. So, the wealth behind the retiring Boomers mentioned above will naturally transfer to women. According to Investment News, $22 trillion in assets will shift to women by 2020, almost a full quarter of all assets.
Additionally, women’s participation in the workforce has been climbing since World War II. The proportion of women with college degrees has also been rising, and the gender pay gap is slowly closing. These changes in the demographics of the marketplace may have a significant impact on your business’s strategy.
How are you preparing your organization for these significant changes in the demographics of the United States? Make sure that your strategy will “Follow the money.”