Baby Boomers: The untapped segment for e-commerce
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Baby Boomers, or ‘Boomers’ as they are colloquially known, are people born between 1946-1964 and are currently between the age of 56 and 74. As of 2019, there were 33.6 million Boomers in Indonesia, or 12.5% of our nation’s population of 268 million. This is the generation that experienced the early years of Indonesia’s independence and came of age in the 1970’s and 1980’s.
Millennials (1981-1996) and Generation Z (1997-2010) make up 85% of Indonesia’s total e-commerce transactions. However, the average transaction value is actually higher among Generation X (1965-1980) and Baby Boomers, and that the average number of transaction per user is 17-20 times per year regardless of age. Boomers have been shopping online more than we think.
Boomers have been a relatively under-served segment when it comes to e-commerce, as most platforms focus their marketing and development efforts on the most prominent segments of Millennials and Generation Z. While understandable, such moves may neglect Baby Boomers who have the potential to be long-term high value customers.
If anything, the ongoing COVID-19 pandemic popularises online shopping among Boomers even more. A recent study by Facebook IQ revealed that 43% of Generation X and Baby Boomers reported a surge of spending since the pandemic began. There were 12 million new e-commerce users in the first three months of Indonesia’s large-scale social restrictions enforcement alone and Boomers are part of this group.
Boomers display shopping habits and preference that are different from those of younger generations. For instance, 84% of Boomers still prefer to shop in-store to see products before making purchases. Boomers also highly value convenience and excellent customer service. In fact, 67% of Boomers report that if an item they want is available online or in a nearby store, they will purchase it at their local retailer rather than use ecommerce.
This is largely due to the personal engagement found at local retail shops that they cannot find on online platforms. At the same time, trust and peer reviews are very important for Boomers, which means good reviews are particularly useful to attract Boomer buyers.
Boomers we spoke to report that they mostly buy food and home supplies, including entertainment and electronic appliances, kitchen utensils, gardening tools and even betta fish, from e-commerce sites. However, unlike Millennial and Generation Z consumers, they are not too keen on purchasing fashion items online. Ms. Lisa (60), one of our respondents, told us that she never bought clothes online because she is afraid of getting the wrong size.
Image: Tokopedia
Online shopping may be growing among Boomers, but the resistance is still there. One of the most common reasons why Boomers are against using an online platform is inconvenience or lack of user-friendliness. Mr. Muchlis (58) told TFR that he mainly uses Tokopedia and Grab to online shop due to their simple and user-friendly interface. For him, the biggest challenge in using an e-commerce platform lies in learning how to navigate the platforms.
Meanwhile, Ms. Lisa and Ms. Itta (59) find the payment process difficult to navigate. “I fear that I will be making the wrong payments, or placing the wrong orders, and I am not sure what to do in case I receive damaged goods,” Ms. Lisa shared. Interestingly, unlike their younger counterparts, data privacy issue is not high on their ‘barriers to adoption’ list.
One thing is for sure: Boomers welcome the presence of online shops, and their buying power is there. However, they need to be serviced in a way that is different from the younger generations. Marketers and e-commerce companies need to realise Boomers’ potential and respond accordingly so as not to miss out on such a lucrative segment.
Understanding what Boomers look for and which areas should be improved to generate more sales is essential for e-commerce companies. In general, companies need to provide excellent customer service, employ simple and user-friendly interface, use direct, concise and value-based copywriting, target them in their natural habitat, as well as provide supporting content, such as videos.
Boomers highly value excellent customer service throughout their customer journeys. As discussed above, a large portion of Boomers still prefer brick-and-mortar stores due to personal engagement provided by such shops. Therefore, online sellers can actually benefit from having real representatives available to assist shoppers. This includes providing a chat or call feature and making the feature highly visible and accessible.
Ms. Itta said that she loves using Instagram better than any e-commerce sites to shop, “It’s more convenient, because I can easily contact the sellers. I only use Tokopedia if I cannot find the items on Instagram.” Indeed, Instagram sellers often make their phone numbers easily available on their bio, while most e-commerce platforms, such as Tokopedia, only provide chat features.
Next, user-friendliness is vital. More than just being user-friendly, online platforms need to be digitally accessible. Otherwise, e-commerce sites may deter prospective Boomer customers. Lisa, for example, does not like to use Shopee in particular because she finds the home screen too ‘full.’ Digital accessibility refers to how easily an asset can be viewed, used and understood by a variety of different audience. It is recommended to use bigger font sizes, apply visual contrast and use proper button sizes, especially for mobile devices. Ideally, buttons are at least 44 pixels high to accommodate finger size on mobile devices.
Moreover, companies need to understand what constitutes effective copywriting for Boomer audience. For this particular segment, using slang words are not recommended because generation-specific languages may alienate users, create miscommunication and result in lack of clarity. Effective copywriting for Boomers means keeping the language clear and concise – which may include bullet points –, focusing on value-based messages and keeping the tone simple and easy to understand.
Now, we cannot stress the importance of capturing a target audience in their natural habitat enough. In the case of Boomers, their natural habitat is Facebook. Facebook is by far their most preferred social media platform to stay in touch with loved ones and stay informed. Thus, Facebook ads may work particularly well for Boomers. Brands and advertisers may use segmented and advanced targeting to effectively identify and target Boomers on Facebook.
Generation X and Boomers are currently dominating the global growth of cellular phones and e-commerce. Forbes reported that Boomers use their phones approximately five hours per day, not too different from Millennials, who use their phones five and a half (or more) hours per day. Information on mobile behaviours among the Boomer generation such as this may be useful for companies in formulating their mobile penetration strategy for Boomers.
Image: Ms. Lisa’s package dropping station
Lastly, companies should consider using more videos to communicate a product’s messages. Generally, Baby Boomers prefer slower video formats that explain concepts in detail. Going back to their favourite platform, Facebook, 85% of videos on Facebook was watched without sound. Thus, captions are strongly recommended. Striking visuals, large typography and short, written sentences are also preferred.
While the COVID-19 pandemic helps boost this trend, e-commerce platforms’ relationships with Boomers are not expected to end once the pandemic does. More Boomers have now been exposed to the delight and convenience of online shopping, and they will not give it up entirely even when they are able to.
Ms. Lisa expects to still shop online even when offline shopping becomes safe again, “I save up on gas money, and I don’t have to bother carrying my groceries around. Although, for fresh produce I don’t plan on buying from an e-commerce again; they’re just not as fresh.”
With the help of her daughter, Ms. Lisa has even set up two package dropping stations in front of her home. For the foreseeable future, she expects these stations to remain where they are.
