NEW YORK — There is about $26 billion in apparel purchasing up for grabs annually by the 50-and-older crowd — but it will be challenging for any one brand to count on a good chunk of it.
That’s because Americans 50 and up are showing little loyalty to fashion brands, unlike their predecessors at the same age.
Just 10 percent of the group, which numbers 81 million, has professed an attachment to particular brands of activewear; only 9 percent were loyal to casual sportswear labels; 8 percent felt strong ties to careerwear names, and 4 percent stayed true to fashion accessories brands, said Michael Gratz, research director at AARP Publications, in citing data from a Roper Poll taken in 2004.
“These are very demanding individuals and they won’t settle on something because of a brand name,” Gratz said in an interview, referring to people ages 50-59. “Quality is most important, they have money to spend, and, unlike their predecessors, if you don’t give them what they want, they’ll go to another brand.”
Here’s what’s at stake: First-wave Baby Boomers, in the 50-59 bracket, are spending a total of $1 trillion in discretionary income annually, said Marshal Cohen, chief industry analyst at NPD Group. By comparison, people just a decade older are spending about half as much discretionary income, or $500 million a year.
More broadly, the 50-and-up set has collective income of about $2 trillion annually, according to AARP, the Washington, D.C.-based advocacy group for people 50 and older.
Apparel is attracting $25.8 billion in annual spending among Americans over age 49, with the largest share, 55 percent, or $14.3 billion, being spent by those in their 50s, and 27 percent, or $7 billion, being shelled out by those 60-69, AARP data shows. Those 70 and older account for the balance, another $4.5 billion in clothing expenditures a year.
That $25.8 billion budgeted for apparel annually compares with annual purchases by those 50 and older amounting to $649 billion for automotive goods and $1.5 trillion for investments. Those clothing purchases represent a 14 percent share of the $178.7 billion expended annually in the U.S. for things to wear, excluding shoes.
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By 2010, today’s fiftysomethings are projected to increase their discretionary spending by 12 percent, to an estimated $1.12 trillion while people now in their 60s are forecast to up their discretionary outlays by 7 percent, to $1.07 trillion, according to NPD Group. And that same year, the 55- to 64-year-old crowd and 65-and-up cohort are each expected to account for bigger percentage growth in the dollars they spend on apparel than any other age group. Those in their mid-50s through mid-60s are seen expending 9 percent more than current levels, or about $15.6 billion; those 65 and up, 6 percent more, or $7.21 billion.
In addition, four years from now, 80 percent of the country’s assets will be in the hands of the 50-plus population, up from 77 percent today, based on data from NPD Group and AARP. Currently, adults ages 55-64 have a median net worth of $112,000, or 15.5-times more than the $7,200 median net worth held by those 18 to 54. (In 2001, Americans 50 and older held $29.1 trillion in net worth, reported Paul Robb, chief executive officer of Kellwood’s lifestyle group, which comprises brands such as Oscar by Oscar de la Renta, Izod and Sag Harbor.) Robb said he was citing data from Deloitte Research and Imago Creative.
Robb, Cohen and Gratz made presentations last month at a seminar called “Fifty is the New Thirty-Five,” held by the American Apparel & Footwear Association at The Union League Club here, where they were joined by other panelists, including Kimberly Grayson, senior vice president of marketing at Aerosoles, and Peggy Northrup, editor of More, a lifestyle magazine dedicated to women 40 and older.
By 2020, Gratz forecast that 38 percent of the country’s adults, or about 115 million people, will be 50 or older, up from 28 percent, or 81 million today, 40 million of them women. The upswing is being fueled by a U.S. population in which someone is turning 50 every seven seconds, a rate one second faster than the eight-second interval at which a baby is being born. In addition, women who are now reaching 50 without incidence of heart disease or cancer have an average life expectancy of 92 — 15 percent longer than women’s average age expectancy of 80, Robb noted.
“Baby Boomers don’t stop,” Cohen said. “They’re playing hard and spending harder.” It’s a reflection of a phenomenon the fashion industry analyst described as “growing older, not up.”
People ages 50 and older reported feeling younger than their age and still wanting to be more active, according to an NPD Group study of 40,000 adults ages 18 and older, conducted online in October. More than 40 percent of the women surveyed expressed a sense of youthfulness and 60 percent acknowledged a desire to be engaged in more activities. Among their male contemporaries, 60 their age, said the magazine’s editor, Peggy Northrup.
Parts of two generations that have grown up expressing themselves, in significant part, by the clothes they’ve worn, Baby Boomers and Post-War women ages 45-65 are a lot more likely to feel judged by the apparel they wear than are those under 45 or older than 65, Cohen said. That belief characterized 45 percent of females 50 and older, and 50 percent of women overall surveyed by NPD Group.
In contrast, NPD Group found, women younger than 45 are continuing to place a premium on expressing themselves through their choice of electronic gadgets, like cell phones and MP3 players, as well as by becoming savvy financial investors.
Those 50 and older are most influenced to buy apparel by in-store displays, which move 76 percent to do so, Robb said, followed by magazine content, which sways 41 percent; people on the street, 34 percent; friends, 32 percent; family, 15 percent; TV and movies, 12 percent; the Internet, 9 percent; celebrities, 6 percent, and sales associates, 5 percent. Another 5 percent said none of those things influenced their clothing purchases. Those figures are based on a study conducted in December for Kellwood by Applied Research and Consulting, a consumer market researcher.
Don’t look for the 50-and-older crowd to burn through their financial resources, though. On the contrary, Cohen said, a new mind-set has been emerging among the cohort, sparking investments in 401(k) retirement plans on a bigger scale than their predecessors set aside money for retirement, as well as the leveraging of second mortgages and reverse mortgages. Compared with prior generations, today’s 50-and-up population has greater access to financial information, a higher degree of wealth and a broader offering of retirement plans. They have also been prompted to sock away more money by the declining reliability of pension plans — programs that could be counted on with greater assurance in the past.
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