Get to Know Gen X — and Its Segments

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Generation X — the demographic just on the heels of Baby Boomers — has big shoes to fill. After all, the 76 million Boomers are the largest demographic group in U.S. history.

Chances are that as a cable marketer, you know all about the Boomers. It’s even more likely that you don’t know much about Generation X.

Of the almost 300 million people in the U.S., about 50 million are ages 24 to 39 and fall within Generation X. They make up about 20% of the U.S. population and represented an estimated $1.4 trillion in spending power in 2004.

Over the next several decades, Gen X consumers will exercise this spending power to become a dominant force in the economy. For cable marketers, you now have the opportunity to extract more than 40 years of lifetime value from this still-untapped market.

But reaching Generation X will take a bit of understanding. You won’t get anywhere marketing to them with the same offers and messages you’re using for Baby Boomers.

WHO IS GENERATION X?

Don’t feel bad if you don’t know the answer to this question. Most of us are not well-versed about the people included in Generation X. We’ve been spending most of our time cultivating lifetime customers from among the Baby Boomers.

The defining moment that ended the Baby Boom occurred in 1964, which was the last year since World War II that the U.S. birth rate hit 4 million. After that, birth rates began dropping, ushering in Generation X. Today, Gen Xers account for about one-third of all U.S. households.

From 1965 to 1980, the United States experienced the highest divorce rate in history, which means that many Gen Xers grew up as latchkey kids. The “one employer for life” era ended during their childhood, and Gen Xers saw less reason to be loyal to corporations.

Their insecure world fostered an independent attitude — one of “nobody will take care of me but me.”

On the bright side, Generation X is the best-educated and most technologically savvy generation in history. For those who choose to have children (29.7 million Gen Xers are parents), they’re determined to be more family-oriented. They also have a tendency to be tolerant of alternative lifestyles and cultural diversity.

Generalities about Generation X aside, the most common trend among this group of people is individuality.

It’s increasingly important to understand your customers’ wants, needs and media habits to reach them effectively with your messages.

Compared with Baby Boomers, Generation X represents a smaller market. That makes targeting them effectively with the right message even more critical.

Extensive research and analyses has been done on Generation X. From this, we know a great deal about Gen Xers’ behaviors and preferences, such as the types cable programming they prefer, their desire for high-speed Internet access, their vehicle preferences, publication readership, health habits, shopping and consumer behavior or Internet behavior — their attitudes about nearly everything .

From the analyses, 11 cohesive consumer segments have emerged from within the 35 million Generation X households. These include four married segments, four single-female segments and three single-male segments. Each segment has unique age, income level and behavior characteristics.

So, how do you reach Generation X? Primarily through the Internet. This tech-savvy consumer group is on the Internet more than any other, so you’ve got to be on the Internet to market to them. You can also be certain that your Gen X customers use the Internet to research their cable, Internet access and telephony choices.

Delivering the right message means two things: First, your ads must appeal specifically to Gen Xers. Second, you tailor your message to each segment within Generation X.

For instance, educated working women tend to be responsive to messages that emphasize watching channels like Lifetime and Oxygen or surfing travel Web sites at high speed. On the other hand, young families would be more likely to look for Nickelodeon and the Disney Channel on digital, as well as cable’s “something for the whole family” benefits.

Here’s an example of how household-based segmentation can help you craft a relevant message about your cable services, targeted at these two distinctively different types of Generation X consumers:

Educated Working Women

Median age: 33

Median income: $50,000

Sample direct-mail copy: “You’ve learned to enjoy the freedom of being single. You can ski on a whim or buy that treadmill you’ve had your eye on without consulting a soul. You earn it — you deserve it. Don’t you also deserve the best that cable has to offer? XYZ’s Platinum Service not only provides WE, Oxygen and TLC in digital, but for only pennies a day you can be speeding down the information superhighway with an XYZ Internet bundle. For more info, see our ad in InStyle or log on to www.xyzcable.com.”

Young Families

Median age: 32

Median income: $53,000

Sample e-mail copy: “You enjoy today’s hectic pace and live life to the fullest. Whether it’s kids, work or play, you’re constantly on the go. That’s why XYZ Cable now offers its Signature Silver Service. Think about it: High-speed Internet with a cable modem; DVR to let you record, pause and fast-forward your favorite programs: and crystal-clear digital cable with the Disney Channel, Nickelodeon and much more. To sign up today, call 212-555-1212 or just click www.xyzcable.com/Silver.”

Customizing your ads for each Gen X segment doesn’t have to be elaborate, just relevant.

You’re appealing to the educated, working woman not only with your offer — but also with the smart, sophisticated and hip tone of your copy.

What appeals to the single woman is very different from the fast-paced and practical copy that suits young families. In this ad, you’ve recognized that they lead a busy life and want them to know that you’ve got a bundled package that’s perfectly suited to them.

PLANNING FOR GEN X TRENDS

Generation X also presents some unique opportunities that cable marketers should keep in mind. As children of the technical age, they want, demand and expect you to provide the latest products and services. Because they are technologically savvy, they will be great prospects for voice-over-Internet protocol and high-speed Internet access. This means you’ve got to position your company at the leading edge and offer services of interest to this generation.

Because they are younger, the lifetime value of Generation X households is likely to be much greater than that of Boomer households. The Gen X household that signs up for DVR today is likely to be a great candidate for On Demand tomorrow.

Armed with an understanding of all the different groups of people within Generation X, you’ll be able to target the right offer and the right message to the right people, using the right medium.

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