The "Experts" Were Wrong: Boomers Love Retirement Communities

Mike Baumayr who heads up the Chapter Two ad agency in Phoenix has been active adult community developer Del Webb’s primary ad agency for more than 15 years. Del Webb was one of the first developers of senior housing to seriously research the question, “Will boomers move to retirement communities, and if so, what will be important to their housing decisions?”

I’ve seen countless predictions that boomers wouldn’t move to Sun City-type age-restricted communities. However, those predictions betray a poor understanding of the older mind, boomer or not.

Mike Baumayr does understand that mind. In fact, I know of no one who better understands the older minds that move into so-called active adult communities.

I talked to Mike the other day. I asked him if now that the first boomers are turning 60 did he yet have a strong fix on their housing choices as they march into their retirement years.

“Yes,” he resoundingly replied. “I sure do. There are two things real important that I’ve learned. First, a housing product means a lot less to boomers than the community it’s in. Second, boomers are more flexible about moving.”

Neither of those statements may seem particularly revelatory to you. However, as developers the nation over plunge into the age-restricted housing market, very few “get it.” They’re still selling product and amenities (and financing) with only pro forma references to community.

One ad I saw this morning by a major national builder shouted “Thousands of dollars in luxury extras at no extra cost!” That’s a sales pitch for the under-50 crowd. Mike is absolutely right. For most people pondering a move to an active adult community, luxury is not the catalyst that will propel most of them into a buy decision.

In the first place, few people ascend to new levels of luxury in retirement. “Luxury” is a materialistic value that most people in their 60s and older (very few people move into a seniors community in their fifties) don’t find all that engaging. It’s the community that they want to be engaging. That’s not just a boomer thing. It has always been the case.

If you are in an area that offers age-restricted housing, check out the real estate ads. Rarely will you see an ad that connects deeply with older people. Notwithstanding older faces in the ads, the body copy reflects the materialistic and narcissistic values of the young. In other words, a disconnect exists between values reflected in the copy and the people depicted in the ads.

When prospects for active adult housing visit a community, it is often despite the marketing. And when they buy, it is often despite sales pitches about the merits of the product.

________________

I just posted a story about Home Depot to my other blog, Firms of Endearment, that might interest you. Home Depot under ex-GE executive Bob Nardelli is coming apart. The problem starts with Nardelli’s lack of understanding of consumers of any age. To boost the bottom line he has cut deeply into customer service and destabilized his workforce by adopting Wal-Mart’s strategy of putting as many people on part-time as possible.

Read the post and the longer story in this week’s Business Week about how to destroy shareholder value in short order. The significance of the story is not Home Depot, but about what happens when companies trying to survive in the 21^st century cling to 20^th century ideas about managing companies, marketing their products, and serving customers. In fact, on that latter point read about how Northwest Airline crashed to number one in customer dissatisfaction. They now charge $15 extra for an aisle seat and $1.00 for a tiny snack bag of nuts and raisins. So how long do you think it will continmue flying?

Comments

[mrpositive]

David,
As usual, your post is dead on. While communities spend millions on feature, amenities and services, most spend little on training and orienting team members. Communities aren't about bricks and mortan but about people. SW Airlines Founder Herb Kelleher would advise that the reason more aren't successful is because they haven't figured out that the culture is critical.

It might be interesting for Del Webb to study how much the typical community spends on staff development prior to opening and on a quarter basis thereafter. I am guessing that amount would be minimal.

[David]

Dick,

Well said! Some people don't know beans when the bag is open. It seems to me to be self-evident that people in general lose much of their appetite for the material stuff of life as they move into their later years and focus more instead on experiences in their quest for life satisfaction.

DBW

[BobW]

Having been a security officer at two continuum-of-care fscilities, and my late wife having worked at a third, (all with protestant affiliations,) and having passed my 60th, my own thoughts are these>
1. That "staff development training" better start right at the top, and had better include such niceties as having at least one member of upper management show up at funerals, 100th birthdays and the like.
2. It had also better get it through management heads to treat their RNs. LPNs, CNAs and the like with respect. These are the facility's "combat infantry" and, like soldiers, the more old vets the better. Better to give the pay and benefits that keep good people around than to accept low morale and high turnover as "facts" of the business.
3. 60-somethings are ready to move, but by-and-large not ready for retirement communities. Any baby-boom surge is likely ten, fifteen or even twenty years away.
4. You're right that these folks are not looking for luxury. A hot dog presented with a smile beats a filet mignon angrily slammed on the table, and I saw too many residents put up with things just about that bad. I think the boomers are more likely to remember who is paying who and to vote with their feet. And I'm with them 100%.
4. I once saw a CNA reprimanded because, when a disabled resident was in-tears hungry in midafternoon, the CNA made her a sandwich. The reprimand was for not putting it on her bill. If the finances are so bad that a simple, loving gesture must become a commercial transaction, it's time to shut the doors. If something keeps boomers away from these places, it will be the memory of how their own parents and grandparents were treated like widgets, not people.

The retirement community was the one place in my life where I could hit the streets wearing a badge and know I was liked as well as respected; and on a day-to-day basis I saw more courage, and optimisim in the face of adversity, than anywhere before or since. Anyone in the business, from busboy on up, would do well to keep in mind that we're all headed where these residents are now. And to do as we hope to be done by.

[joared]

I believe David is correct in his assessment that the advertising rhetoric, generally does not reflect the values of most older people, thus, is not compatible with the older individuals shown in the videos. At least there is little attraction for me.

I think BobW's comments certainly deserve serious consideration by anyone considering moving into a retirement community as items to check out.

I have and continue to work in some upscale retirement communities who do not have the problems he describes. If I was interested in that type living arrangement I would have little hesitation selecting any one of 5 with which I am familiar.

Am surprised to hear Boomers are expected to move to these communities, as I, personally, believe the thrust to be for people to remain in their homes with any necessary adaptations needed, the help and support desired more readily available, with changes in attitude and funding toward providing financial assistance for those who have that need, to be the future. That's certainly the approach I promote. That also happens to be what I want for myself; am planning accordingly.

Many of retirement age, whether or not still working such as myself, express the same view my mother had, which is that ideal living arrangements include an environment with people of differing ages, not just all elders (retirement age individuals.)

[Hal]

I am more than somewhat astonished to read that there is an expectation that Boomers will move "en masse" into retirement communities. One writer suggests in 10 or more years, and that seems possible for ages 75-80. I am just over 60, not retired but in forced "rest" mode, and moved from Washington, DC, to a Main Street community in Maine that allows me to walk almost everywhere for food, social life, and the usual daily needs. In addition, I am renovating an old house for Universal Design so that I can age in place. None of my friends and colleagues is contemplating the isolation of a retirement community. Most are looking for integrated communities with access to social and cultural amenities, transportation, shopping, and other benefits within a community of all ages and interests. Low maintenance is a concern. The only aggregating factors I see are personal interests, such as sports, culture, and gay/lesbian, and the proximity to good health care, religious institutions, and family--definitely not "retirement." Not that many unfortunately are thinking about Universal Design because they aren't aware of it. The real opportunity lies with smart small communities with the marketing savvy.

[Tom Jones]

Hi everybody. As I am also approaching retirement I have done a lot of research on this subject. I believe that everybody should have good information therefore I have come up with a free report about The Missing Ingredient That Will Supercharge
Your Retirement – And 92% of People Don’t Know About It! If you are intererested you are welcome to download it free from my website. Don't waste time. Get your Free report now on my website planyourretirementtoday.com !

[Seniors Community]

Seniors community refers primarily to retirement communities where seniors can live out their lives among other seniors with dignity and in most instances while maintaining their independence. There are many different types of seniors’ communities. They can be broken down into two broad headings: Residential, and Non-residential A residential seniors community can be further broken down into categories depending on the living arrangements.

[Sheldon Vik]

Well Said. So many companies are still trying to do business like that it was 1960.

A few years ago it seemed like retirement was a long ways off. We both had good jobs, a 401K, and felt like we had time to save enough to retire comfortably. How quickly time has passed. Both of our retirement funds have lost money and the future looks grim. We have decided needed a plan B that would continue to bring in money to supplement our savings. Instead of relying solely on social security and savings, we have decided to try our hand at network marketing. It took several tries to realize that not every network marketing opportunity provides the kind of security we are looking for. A lot of them only wanted to take our money and offered nothing but hot air in return.
Even though we are both computer “literate”, network marketing is a like entering a new job, and we realized we needed the support and help of a good, honest team to be a success. We have learned some really neat ways to market the five opportunities we have chosen. One of the first lessons we have learned is network marketing is just like any other job and requires hard work, time, and patience.

[Seniors Community]

Seniors community refers primarily to retirement communities where seniors can live out their lives among other seniors with dignity and in most instances while maintaining their independence. There are many different types of seniors’ communities. They can be broken down into two broad headings: Residential, and Non-residential A residential seniors community can be further broken down into categories depending on the living arrangements.

[seniorDECISION]

The generational change is indeed afoot and those consumers that might have "accepted" things "as-is" are being replaced with consumers that require things to be the way they want. This is a HUGE deal for the senior living industry and a shift that the industry as a whole is not ready for. Physical plant cannot easily be changed. However, marketing messages can. My guess is that more organizations will try to transform themselves via marketing efforts, but unless operational changes accompany these changes, consumers will indeed vote by taking a seat right where they are.

Consumers indeed have the power even today (as many baby boomers are adult children of seniors thinking about active adult and more today). Keeping dialogue going at sites like http://www.seniorDECISION.com is that much more important.