How many people live in the United States

1
Chapter 6

• How many people live in the United States?
• Of what significance is that figure to Marketers?
• How often is the U.S. Census taken?
• What kinds of information is gathered?
• Why is that information important to Marketers?

2
The Domestic Marketplace

• 2 markets for products
• The Consumer Market
• Age group
• Ethnic background
• Income
• Geographics
• Psychographics
• The Industrial Market
• Type of business

3
Consumer Market
All people who make purchases for personal use
Current Population
Estimated Population Year 2025 335 MILLION
4
Consumer Market
U.S. 295,417,407World 6,417,357,2871849 GMT
(EST5) Feb 07, 2005
Up 22 in 25 years Largest American increase
1990 2000 with a 13.2 increase! Net Gain of 1
person every 12 seconds
Where is the Growth? West 19.7 (Nevada
66.3!) South 17.3 Midwest 7.9 (Illinois
8.6) Northeast 5.5
Demographic shift will make the consumer market
very different from what it is today.
5
Study Demographic Variables

• Age
• Ethnic background
• Income
• Gender

6
Geographic and Psychographic Trends

• Considered
• All factors put together provide a comprehensive
  picture of the U.S. consumer market.

7
AGE
Generation when you were born. Shares certain
characteristics Cohort when you came of
age much more important because it defines
the group music, politics, war, culture
8
AGE
War Babies
Well-heeled older persons 55-60 years old
Those over 65 will number 35 million by year
2000--an increase of 4 million since 1990
9
AGE
War Babies
Ages 60-65 still working peak earning
power High income and newfound freedom from
responsibilities!
10
AGE
Luxuries have been EARNED! It is my turn!
Housing Market not downsizing Reflects desired
lifestyle
Car minivan is gone!
Healthy, Active, Social
11
AGE
Depression Babies
Ages 66-75 Young Elderly Financially
secure Active Healthy Targets for leisure
market
12
AGE
1990 4 2000 12.4 Companies prepared
them for retirement! Travel Market cruises,,
trips Education computers, hobbies,
students! Housing Retirement communities
NOT nursing homes
13
AGE
GI Generation
Ages 75 Primarily Women Poor Health Less
Mobility (Disability?) Targets for nursing homes
and services for the elderly (health)
14
AGE

• Men are dying off
• Less active, rely on others
• 30 live alone
• Whoopie Market is a group of Haves and Have Nots
• Retirement, Medical Expenses, FIXED INCOME
• What do we sell them?
• Easy open Small servings Cosmetics
• Medical Equipment Comfortable clothing, shoes

15
AGE
Baby Boomers (effects of WWII)
Born 1946-1964 1990 -- 77 million 1997 -- 78
million Marketers have focused on them for many
years because they are the largest
percentage Prime targets for luxuries
recreation items
16
AGE
Now at Peak Income Getting older, but NOT getting
old! Use their music, attitudes, stars, culture
when promoting
17
AGE
Generation X
Born 1965-1980 Baby Bust Generation 44
Million Strong Latchkey Generation self
sufficient High levels of education (47 higher
ed) Felt effects of 1990 Recession Financially
cautious and conservative Fashionable, Complainers
18
AGE

• YOU OWE ME!
• Disappointed by difficult economic times
• Entered job market during 1990 recession
• No Jobs when ready Baby Boomers not retiring
• Very educated stayed in college
• Latch Key Generation home alone with TV
• Held together by TV trivia and credit card debt

19
AGE
Consume Cosmetics Fashionable
clothing Movies Electronic items Marketing
Tactics Sharp images Music Sense of humor
20
AGE
Gen Y
Born 1980-2002 Baby Boomers Babies 76 Million
Parents at peak earning potential Brand
Loyalty, Influencers of family budget Luxuries
are now Needs
21
AGE
Moms have own careers financially better
off Parents indulging kids Teens spent 89
billion in 1994 Needs 2nd Cars, Cell Phones,
Cable, Sports Camps (these items used to be
luxuries)
22
AGE
Marketers build brand loyalty with this
generation. Frito-Lay has seen a rise in chip
snacking by adults, whom they attracted
(hooked) as teenagers and have
maintained. MasterCard wants to do the same thing
by offering teens their own credit cards. Sony
learned that 60 of 12-17 year old have their own
CD players. Teens have a lot of buying power
(shampoo, deodorant and toothpaste).
23
AGE
Gen Y
Estimated Influence on Family Budget 132
BILLION
24
AGE
Millennials born after 2000
Children ages 4-12 increased 10 from 1990 to
1994. What new products could we offer this group?
25
AGE
Millennials
Childrens Market continues to grow as an
underserved market Strong Influencers Food,
entertainment, cars, vacations
26
ETHNICITY
U.S. Population

• White
• African-Americans
• Hispanics
• Asian-Americans

27
ETHNICITY
African-American
33 Million spend 350 Billion Influenced by
companies who show community support
28
ETHNICITY
African-American

• Maybelline
• Black History Month Promotions
• Coalition of 100 Black Women
• A national organization that dedicates its
  efforts to improving the lives of women.

29
ETHNICITY
African-American

• Revlon
• Supports the United Negro College Fund

30
ETHNICITY
Hispanics

• 26 Million in 1994
• Grew at 7 times the rate of the general
  population between 1980 and 1990
• 31 Million in 2000
• Growth is due to immigration and tendency towards
  larger families
• Education well below rest of population
• Larger households (3.53 v. 2.48)
• Larger families (3.4 v. 2.6)
• Younger than average (31 are younger than 15)

31
ETHNICITY
Hispanics

• Marketing Information
• Use language in promotion
• Use Spanish-language television
• Hispanics watch T.V. 3.6 hours a day
• Avoid treating all nationalities as the same
  (Mexican, Puerto Rican, Cuban, etc.)
• Gain a thorough knowledge of Hispanic culture.
• 70 of Hispanics are Roman Catholic
• Hispanic culture centers around families

32
ETHNICITY
Hispanics
Marketing Information Food Producers package in
larger quantities due to the larger family
size. Key Cities New York City, Los Angeles,
Miami, San Francisco, and Washington D.C.
33
ETHNICITY
Asian-Americans
7.9 Million in 1992 10 Million in 2000 Median
household income higher than average Concentrated
in specific markets LA, NYC, Honolulu 16
different nationalities fall into this category.
More college degrees and professional jobs
34
ETHNICITY
Income higher due to higher education 57 of
this market located in CA, NY, HI Easier for
marketers to use local media to reach this group
rather than more costly national media
35
INCOME

• How much money do you have available to spend on
  different products?
• Disposable
• Discretionary

36
INCOME
Disposable Income
Gross Pay Taxes Net Pay
Rent, Utilities, Transportation Food, Clothing,
School Supplies Medicine, Personal Care
Marketers are interested is changes of disposable
income
37
INCOME
Discretionary Income
Money left over after paying for basic living
expenses Marketers of Luxuries Entertainment,
Jewelry, Fashion
38
INCOME
Socioeconomics
7.3 of households earn pretax income over
100,000 Account for 1/2 of all discretionary
spending Household operations New
Cars Trucks Education Household
Furnishings Household equipment Womens and
girls apparel and services
39
INCOME
Socioeconomics
33 of households earn less than 25,000 Growing
notice is being taken of this lower income
group Dollar General Wal-Mart
40
INCOME
Real household income has increased Midwest has
highest increase South lowest household income,
Northeast highest Inequality is
increasing Bottom 20 is getting less every year
1/2 of
people in poverty are elderly and children
41
Demographics

• Where are people moving
• Trends
• Moving South, West and Southwest
• Many retirees are relocating to those parts of
  the country
• Industries moving here in search of lower labor
  and land costs.

42
Psychographics

• Psychographic trends tend to follow demographics
• Ages change attitudes and lifestyles

43
Psychographics

• Changes are related to the differing sizes and
  habits of the different generations
• Movement through the family life cycle causes
  change.

• Family life cycle
• Single
• Newly married
• Full nest (children at home)
• Empty nest (children leave home)
• Sole survivor (widowed)

44
Psychographic Trends

• Having Fun
• Increase spending on entertainment, theme parks,
  sports, toys, electronics
• Eating Naturally
• Nutritional concerns
• Fat, cholesterol, calories, Low Carb

• Exercising at any Age
• Relieving tension, social, new equipment
• Shopping for value
• Outlet stores, warehouse stores,value meals
• Green Marketing
• Recycle, reduce package, conserve natural
  resources