Reverse mortgage borrowers are getting younger. They are feeling younger, too. Marketing to them requires attention to new details, experts say: their online savvy, story-seeking and independence.
And whatever you do, don’t call them “old.”
The “boomer” generation
Marketers agree, the attitudes of the boomer generation represent a sharp departure from those in the “Greatest” generation, and it’s important to consider that while there may be 10,000 new boomers turning 65 each day, the last thing they want is to be considered “senior.”
“They don’t view themselves as old,” says Jim Gilmartin, president of Chicago-based Coming of Age Marketing, a company devoted to marketing specifically to the baby boomer population. “They often see themselves as 10 or 15 years younger, and they don’t want to be treated as old. There are still many people who are active and vibrant into their sixties and seventies.”
This older demographic doesn’t just feel younger, but they actually are becoming younger relative to even older counterparts, with people living longer on average and gravitating toward much more active lifestyles.
“As boomers are entering what used to be considered old age, we are finding ourselves with about 20 extra years tacked onto our lifespans,” says Shannon Ingram, executive vice president and managing director of FaceTime Strategy. “We now are confronting new ‘middle’ years.”
A combined 8 in 10 American workers, for example, think they will continue working full or part time after they reach retirement age, according to a 2011 Gallup poll.
Proportionately more of these workers, 44% to 36%, say they will do so because they “want to” rather than because they “will have to.”
Realizing the distinction can be an important hurdle in creating messaging that appeals to customers of financial products for the boomer generation. It has to not only fit their needs and preferences, but also has to align with the ideal with which they associate themselves.
“Selling to Boomers and older consumers is different than selling to others primarily because of this shift in how we manifest our values,” Gilmartin says. “Our need for identity, relationships, centering, gaining knowledge and growth, rejuvenation and recreation are always with us, but as we grow, we focus more on having meaningful experiences rather than gaining material goods.”
Selling to 60-somethings
Acknowledging what the demographic does and does not consider to be self-characteristics is one step, as is agreeing that one size does not fit all.
“Some marketing approaches that worked well 20 years ago are not effective today,” Gilmartin says. “For example, focusing on experiences the product leads to is a better strategy today than focusing on products.”
Reverse mortgage lender American Advisors Group, which runs a successful national advertising campaign with former Senator Fred Thompson at its helm, has found success in that concept.
“You have to find a hook in the problem you’re trying to solve,” says Teague McGrath, director of marketing. “It’s not about the reverse. It’s about the point in their life you’ve helped improve. If you can tell that story, it comes along as part of the solution, not just a product.”
Additionally, it’s important to know where the borrower is. There’s a good chance that means the Internet. Today’s 60-something is online savvy and lenders are catching on to the online market to keep up.
“We are aggressively going after our online platform and improving it,” McGrath says. “The 62 to 65 market are more comfortable with a computer, but it also lets us diversify our platform so that we are not all TV. It helps get a different type of [borrower].”
Just being online isn’t enough
Gaining an online presence is a start, but if you’re going to do it, do it right, the experts say.
“One of the leading ways to create a sense of trust with consumers is by displaying a secure site certification on your home page, such as the Trust Guard or Better Business
Bureau (BBB) seal,” Gilmartin says. “Another way to build trust with the over 60 crowd is by explaining, if not on your homepage then on an easily found ‘About Us’ page, who you are, your values and your mission.”
Having a customer service number on every page is a must, as is a live voice on the other end of the line when a borrower picks up the phone, Gilmartin says.
Aesthetically, a simple, clean and uncluttered site works best, as does a font size that is easy to read and color scheme that allows for strong contrast.
“Use positive imagery,” Gilmartin says. “Seniors often view themselves as 10 or 15 years younger than they are, and are often active into their 70s or even 80s. So it’s good to feature images of active or happy older people.”
The celebrity conundrum
Between Fred Thompson for AAG, Henry Winkler for One Reverse, Pat Boone for Security One Lending and now Wayne Rogers for Senior Home Loans, celebrities are no strangers to reverse mortgage advertising and marketing. Whether they are necessary is another question.
Lenders can compete without using a high profile celebrity as their spokesman and “pitchman,” says Gilmartin.
“No matter the communication venue, the key is how they position their brand or product in the mind of the potential customer.”
But lenders who employ the spokesmen say that working with a celebrity is money well spent.
“There’s no doubt the penetration you get as a result,” McGrath says. “The difference with Fred [Thompson] was night and day.”
Positioning Thompson’s ads during the recent Republican primary elections proved effective for AAG, which has worked with the spokesman—whose own mother got a reverse mortgage—for more than two years.
Other lenders, though, have taken their efforts in a different direction in telling a story to which potential borrowers can relate. Generation Mortgage, for example, recently launched and tested a TV ad campaign not featuring celebrities, but a typical, American TV family—the Wilsons.
“A fresh approach isn’t necessarily problematic,” says Carl Rojas, chief financial officer for Generation, noting the possibility to tap into a different borrower segment through the commercial. “There’s a spectrum of borrowers and that higher end borrower is one everyone covets.”
Cautions
Casting a wide net may prove effective, however. At least in McGrath’s experience in working with former AAG spokesman Peter Graves and now Senator Thompson, he says a marketing effort with a broad appeal is most worthwhile.
“You don’t want to go after a section of the market and ignore the core,” McGrath says. “If you start marketing toward a lifestyle or a 62 to 64-year-old borrower or some subsection, you may be ignoring the core customer you’re trying to reach.”
Above all, know the audience you are trying to reach and give them what they want, the boomer experts say, regardless of celebrity affiliation, company size or budget.
“Boomers need to trust you,” Ingram says. “Your message has to be honest and relevant. For example, they love nostalgia, but they don’t want to be 20 again.”
The marketing should always hinge on a story, in addition to being accessible and relevant, Gilmartin says.
“Whatever advertising or communications venue lenders use or can afford should focus onpositioning their product or service as gateways to experiences.”
This edition of RMD Report is brought to you by Landmark, a leading national appraisal management and compliance company serving the reverse mortgage lending industry
Written by Elizabeth Ecker
