When a Large Market Segment Becomes a Problem
What happens when Baby Boomers stay home?
What happens when a dominant cohort in the gaming industry becomes hesitant to visit casinos and resorts?
Boomers are a key market driver among target segments in the gaming industry. What happens when they stay away?
Baby Boomers are a massive demographic that controls the largest block of spendable income, with the free time to use it.
The year 2020 has been dubbed the “Decade of the Young Old” in an article by the Economist. According to the article, “the ‘Yold’ – as the Japanese call people ages 65 to 75 – are more numerous, healthier and wealthier than previous generations of seniors.”
“The yold are also better off: between 1989 and 2013, the median wealth of families headed by someone over 62 in America rose by 40% to $210,000, while the wealth of all other age groups declined.”
The web site Marketing Charts reports that “Baby Boomers possess most of the US household wealth. Separating out net worth along generational lines, it’s Baby Boomers who possess more than half (54%) of all of US household wealth. Affluent Baby Boomer households also make up 57% of the total household wealth in this category, and those Boomers in high net worth households make up 56% of total household wealth.”
Changes on the Way
Boomers dominate the casino and hospitality universe. The worldwide Coronavirus pandemic will change the way Baby Boomers view casinos and resorts forever.
The Wealth Effect
Boomers spent a lifetime in rewarding careers. Years of saving and investing for the long-term grew their wealth and put them on top of the economic ladder. Now, the downturn created by the Coronavirus threatens the wealth of Baby Boomers.
Boomer savings and 401K’s took a violent downturn that will kill the wealth effect for the near term. Boomers will hunker down, and the sound of tightening belts will rattle the hospitality, travel and casino industries.
The Safety Effect
It’s a well published fact that Baby Boomers are the most susceptible age demographic to the Coronavirus. The challenge for casinos is to create an atmosphere of safety that Boomers will recognize and believe; that’s a tall order.
Casinos can learn from the retail industry. As the world shut down, food stores, auto parts stores and big box stores remained open and are continually adapting to the forces created by social distancing.
Plastic shields for cashiers, six-foot lines on floors to create distancing, barriers between counter personnel and capacity limits in stores are just a few newly developed techniques that casinos can adapt.
Safety and social distancing will dominate decisions when Baby Boomers choose to visit a public place.
Just before shutdowns streaked across the country, casinos were sanitizing, cleaning and recleaning public spaces to create safer environments. Inside casinos, hand sanitizer stations will become as numerous as trash cans.
It becomes an operational battle to create genuine and transparent safety zones that Baby Boomers will find comfortable.
The Message is the Goal
Casino marketers will be charged with targeting messages to Baby Boomers that incorporate safety into the brand. Though Gen X’ers and Millennials will respond to a safety zone focus, it will not be the driving force behind a decision to visit.
Baby Boomers have more at stake. The Coronavirus demands that your brand segment into age-based slices, sending safety zone messaging to Baby Boomers.
Reach Out Early and Often
Contact with your top Boomer VIP guest will never be more important. As you are able, keep in touch with your best players via phone, text or email. When the player development team returns, job one for your hosts and PD team will be to place calls to your Boomer clients to ask how they are doing. A call now, asking about the welfare of your guests, will go a long way when Boomer players decide to get back in the game. Personal contact with Baby Boomer players now will generate the most good will in the future.
A Bright Side
The Coronavirus shutdown and long-term confinement will help create an improved technique for reaching Baby Boomers. According to a Forbes article, “Covid-19 Will Permanently Change the Way Every Generation Lives – Here’s How.”
“A 2019 Pew Research study found that 68% of Baby Boomers own smartphones and 52 percent own tablets. That technology use is about to leap upward.”
Baby Boomers trapped at home were forced to try technologies such as grocery delivery and streaming entertainment. Boomers will continue to use these services. Now familiar Boomers will use Skype, Facetime and Zoom long after the pandemic ends.
Targeting newly enabled Boomers through mobile, OTT, and targeted digital media will become more productive than before. At least that’s a direction casino can take to send safety zone messaging.
Even with the challenges of a lost wealth effect, safety concerns and a shrunken desire to travel, Baby Boomers are still the leading generation in the gaming industry for now.
The casino industry faced challenges such as 911 and the great recession. In the end, motivating Baby Boomers back to the casino world will become another challenge to beat.