Boardroom View

Dumb Demos vs Smart Stages
Dumb Demos vs Smart Stages

Jerry Shereshewsky, CEO, Grandparents.com
Jul 23 2008

Modern advertising is about 150 years old, so you think the industry would have gotten just a bit smarter after all that time.  But the reality is that the industry is stuck in a totally outdated targeting concept:  demographics.

Don’t get me wrong, there are some demographics that are actually meaningful.  But most just are not.  Acne is most associated (and correlated) with teens.  But, given the changing demographic profile of the US, the rest of those correlations are pretty lame.  In a world where 60 (or perhaps 70) is the new 40, 18-34 just doesn’t cut it anymore.

Behavioral information is, of course, of enormous value.  But it is difficult to get, more difficult to interpret and even more difficult to implement in a timely manner.  But there’s the remarkably simple and obvious targeting tool that Madison Avenue almost totally avoids:  lifestage.

Lifestages are not age dependant.  People become first time parents at 15 and at 55.  People get married (and remarried) at virtually every age.  Retirement is at least a fantasy for people from their 30’s to their 80’s.  So while the demographic/age definition has little or no meaning, the lifestage does.

“Junk mail is a letter addressed to me on the outside and someone else on the inside.”  This brilliant insight by Lester Wunderman says it all.  Most advertising is irrelevant (and the declining recall, click-through, open and read most scores prove that point) because it’s addressed to someone on the outside and someone else on the inside.  And, because most advertising is aimed at a demographic (or several) if it’s not irrelevant it is serendipitously accurate.  But imagine what happens when you can talk to lifestage rather than simply age.  Instead of a shouted (and meaningless)  “Hey you” you can, with even a whisper, get all the attention and relevancy you need and want.

So what’s a lifestage?  Simply put, a lifestage is a shared set of experiences and needs.  They are often relatively short, but very intense.  Brides-to-be are brides-to-be for perhaps 12-18 months.  But during that period, whether 20 or 60, they are making decisions and purchases unlike anything they have ever done before.  The bridal industry believes that there are more than 175 discrete purchase decisions made by the average bride-to-be, involving more than $25,000 in spending! 

Think about new parents, new grandparents, people contemplating (seriously) retirement, people with specific ailments or diseases, people who are moving residences, people (especially men) going through a mid-life crisis.  These are all genuine lifestages with real commonalities shared among virtually everyone within a particular stage.  (By this logic, perhaps acne is a true lifestage even though it is most associated, perhaps coincidently) with teenagers.

The good news is that many (if not most) lifestages have spawned their own media.  And people in those particular lifestages throng to the media to help mitigate the financial and social risks associated with the purchase decisions particular to that stage.  Which brings me back to the dumbness factor.

Carefully look at the various lifestage media; the bridal books (and websites), the new parent media, etc.  They are filled with advertising for the most obvious endemic categories.  Dresses for brides, for example, constitute more than 65% of the ad pages of the average bridal magazine.  But think of all the other decisions the bride-to-be faces:
* She is almost certain to move/change residences (which as P&G knows, has profound implications for cleaning products)
* She will have to make some modifications to her banking relationship(s)
* She is more than likely  to be involved in a new car purchase
* She is ideally positioned for the beginning of a relationship with a financial advisor/brokerage
Yet none of these categories has found their way into the bridal media.  The stock answer, of course, is that these folks are reached in conventional mass media more cost-effectively.  Wrong.  They are certainly exposed but not in the context of their bride-to-be-ness.  They are addressed as Hey You rather than as the special bride-to-be.  The are being spoken to irrelevantly. 

I can (and will) make the same case for virtually all the other lifestage media.  The endemics have to be there but the non-endemics, who should be are not because of the basic dumbness in our industry.  As the CEO of a new lifestage medium, grandparents.com, I have led us in a very strategic assault on the non-endemic categories.  We can get all the pharma advertising we want, but we don’t want it.  Not because our audience doesn’t take prescription medicines (and OTC as well), but because illness has little to do with grandparenting.  Instead we are concentrating on products that are very much a part of grandparenting.  Playskool knows that grandparents buy toys for their grandchildren, and so they advertise with us.  J&J Baby Products knows that grandparents are great sources of advice to new parents, so they advertise with us.  Pepsi knows that today’s grandparents (the original Pepsi Generation) still consume their beverages (not to mention enjoy them with their grandchildren), so Pepsi advertises with us.  We’re still looking for an auto company that understands this story and a major financial services company who recognizes both the size and quality of the opportunity, but we’re well on our way to breaking through the demographic dumbness and breaking into the new world of lifestage smartness.