In 2021, as the nation was coming to grips with the new realities of life post-lockdown and outside the EU, a sizeable change in the world economy went quietly under the radar. For that year was the first in three decades in which the Baby Boomers, a generation at once all powerful and yet much maligned, ceased to lead in global spending power.
Generation X, those born between 1965 and 1980, hold a buying power of $15.2 trillion, set to reach $23 trillion over the next decade, according to Nielsen IQ. But, like the Baby Boomers before them, this generation is still misunderstood and mischaracterised by sections of society. As brands find themselves increasingly reliant on this cohort, understanding the nuances within the group will be essential to unlocking their loyalty.
A generational shift, with caveats
While the balance of spending power may have shifted, Baby Boomers still command significant influence. Both the Prime Minister of the UK and the US President are Baby Boomers. According to Savills, over-60s, 90% of whom are Baby Boomers, hold 56% of the UK’s total housing wealth. Indeed, while 74% of Baby Boomers own their home outright, this falls to just 34% of Gen X.
This leaves the roughly one-third of Gen Xers still paying off a mortgage more susceptible to financial strain. Sudden shocks in the housing market, such as those triggered by the inflation surge after 2022’s ill-fated mini budget, exacerbate that vulnerability. According to Kantar TGI data, Gen Xers have a lower median household income than Millennials. While this is partially explained by higher retirement rates among the older cohort, it highlights the limits to Gen X’s spending power.
What’s more, as many hold caring responsibilities both for their own children and elder relatives, Gen X has been dubbed the ‘caregiver generation’. This creates ramifications beyond their cohort: according to Nielsen, Gen X women influence 70-80% of all household purchasing decisions.
Myths and motivations
Far from being tech-averse, Gen Xers increasingly embrace new technologies for everyday convenience. According to TGI, this cohort is the most likely of all generations to own both a wearable smart device (32%) and a smart speaker (38%). Additionally, 49% agree that apps have made their daily routines easier.
Gen Xers embrace both digital ad linear channels as part of a balanced media diet, being the heaviest consumers of online news content and second only to Baby Boomers in their preference for live radio. This, coupled with rising usage of social media, offers brands the potential for diverse strategies to reach these influential consumers. And while there was previously a sizeable generation gap in adoption of generative AI, recent findings from the7stars’ qualitative research community, The Street, found Gen Xers open to using AI for everything from Christmas gift ideas to travel itineraries.
Gen X may often receive less fanfare than Gen Z, Millennials, or Baby Boomers before them, but their spending power is substantial and only set to grow. Brands should ensure their strategies are tailored to this diverse and influential group. However, while the purchase power of Gen X offers an enticing prospect for brands, succeeding with this or any other age cohort will require more than a purely demographic approach to targeting. As always, brands should develop an audience strategy that considers the psychographics and behaviours – both in and out of category – of the consumers they wish to reach.
