Generational Marketing 101: Understanding the Motivations of Different Generations of Alcohol Consumers

May 11, 2018 In Retailer Insights

Generational marketing is the practice of tailoring your efforts to the habits and preferences of specific target generations to better sell your products to those people. This tactic can be a super effective way to focus your marketing efforts and, hopefully, sell more products. In this post, we’ll explore how generational marketing can work in your favor.

Let’s define the generations we’ll be talking about:

  • Baby boomers are people born between 1946 and 1964. As a group, they are making money, have expendable income and are consuming products and services.
  • Generation X, born between 1965 and 1979, comes next. Their expendable income is also high, but they love a rich customer service experience and finding good deals.
  • Millennials, born from 1980 to 1996, are the largest group of consumers today. They are most drawn to humanized brands and support transparency and experiential marketing.
  • Generation Z, born from 1997 to 2010, are the digital-first consumers. These young people are only just coming of legal drinking age, but will be a challenging force for marketing in the coming years.

Why understanding generational differences matters

Generational traits can help you build better customer relationships, which is the top goal for successful retail marketing. When you look through store-level customer data to see who most often shops in your store, you have a broad picture of who you’re targeting and what they are buying. Diving into the generational traits of those consumers brings a deeper understanding of how to sell to them more effectively.

If many of your customers are millennials, for example, and you know that millennials prefer experience-driven marketing, you can host events and tastings to continue to attract and capture those shoppers.

On the other hand, research shows that, while Generation X is a smaller group, it spends the most annually on wine per person. If your goals are to move more expensive, potentially higher margin wine products, create promotions for those products and focus on informed, helpful customer service.

While they are targeted to specific age groups, generational tactics don’t necessarily conflict with one another. If you notice that your customer base is a mixed bag of millennials and Gen X’ers, appeal to both. By hosting events and promoting more expensive wine products, you can bring a millennial base into your store while also selling product to Generation X consumers.

Generational tactics don’t necessarily conflict with one another. If you notice that your customer base is a mixed bag of millennials and Gen X’ers, appeal to both. Click To Tweet

In general, alcohol is a cross-generational product. Instead of focusing solely on one group, you should use what you learn about each generation to see what themes overlap. Common threads, like convenience and comfort, will attract shoppers of any age.

Here are a few best practices for marketing to the different generations:

  • Baby Boomers.  These adults are the most powerful consumers, as they have the largest disposable income, though their numbers are smaller than the millennial group. Price and convenience are driving factors for them. They are highly engaged, but not as exploratory or adventurous as millennials. When marketing to this age group, look at what they’re already buying and focus on those products rather than on expanding their alcohol portfolio. Find ways to make it more convenient for them to pick up their favorite wines and liquors, like an ability to re-order online and pick up in store. Note that marginal changes in price on the items they regularly buy probably won’t deter them and could improve your margins, especially if you make their check-out experience seamless.
  • Generation X.  Earlier, we highlighted that Gen X’ers spend the most per person on wine annually. As a generation, they are most likely to buy wine in the $70 range multiple times a month. Arrange your store to make those products quickly visible to shoppers, and include them as recommended products. This group of consumers is also driven by price more than quality. Great deals will bring Gen X shoppers into your store, so create strategic promotions on products that drive adjacent sales or make less of an impact on margins when discounted.
  • Millennials.  There are more millennials than consumers of any other generation. As they’re beginning to age into full adulthood, their buying power is growing. According to Wine Access, 75% of millennials surveyed said they would spend more on wine if they could. Millennials want quality products and memorable experiences, but don’t yet have the level of disposable income that their parents, the baby boomers, or Gen X’ers have. Use a recommendation system to expose them to different types of wines and alcohols, and host tasting events and classes. Once they have a good experience trying a wine, hearing more about it or reading a recommendation from a peer, the quality of that product grows in their mind and makes it more worth the cost.
  • Generation Z.  A still young generation, the oldest Gen Z’ers are only 23. They are still exploring the world of alcohol, learning what they like and understanding what quality products they can afford. As they age into liquor store shopping, though, they’ll become a huge economic force, accounting for 40% of the consumer base. To attract and keep them, you’ll need to focus on your social media presence. Social media is incredibly influential to these young consumers, more so than promotions or loyalty. They’re curious to try new things, and trust other shoppers and influencers more than ads.

One Final Piece of Advice

Now that we have explored the “why” and “how” of generational marketing, we have to address one caveat: this is not a one-size-fits-all solution. While understanding the different behaviors between generations can provide some guidance for how to interact with groups of customers, it is imperative that you don’t lose sight of your customers’ individual differences and never stop trying to connect with them on a personal level.

Don’t lose sight of your customers’ individual differences and never stop trying to connect with them on a personal level. Click To Tweet

Generational marketing can be a helpful tool for beginning to improve your targeted marketing in your store, but make sure you use these lessons as guidance, not hard and fast rules for how you should run your store. Keep an eye out for the buying habits of different groups of consumers, and use what you learn to improve your in-store marketing, but don’t disregard what you personally know about your best customers. If you feel like you know a customer on a deeper level, leverage that connection and your personal relationship with them, as that will always be more effective than treating all customers within a certain generation the same.