Like many industrialized nations, the face of the United States is changing. An aging population, a declining birth rate combined with growing ethnic diversity will pose new challenges for the economy. Along with these demographic changes will come shifts in consumer spending, and consumer goods marketers will have to adjust tactics, focus and products if they hope to capitalize on what will be the new reality.
So what will be different in terms of consumer spending in just 11 years? A weakened Social Security system and underfunded private pension plans will make it difficult for a large number of retirees to maintain their current standard of living. From now until 2020, the Struggling and Lower Mid affluence groups will be the only ones to gain share, pulling households from all other groups. Household sizes will decrease. Consumer spending will grow modestly over the next 11 years, but actually fall after 2020. And the changes that occur after that year – both in terms of demographics and spending – will require marketers to dramatically change the way they do business if they hope to continue to grow.
Read an in-depth look at the demographic changes projected to take place in the U.S., and the challenges and opportunities for manufacturers in the July edition of Consumer Insight.