The Boomers' kids, Generation Y, are poised to take the reins
By Dana French -- Casual Living, 4/1/2006 12:00:00 AM
U.S. households spent $2.6 billion on outdoor furniture last year. Baby Boomers alone accounted for more than two-fifths of the total dollars spent, spending nearly $1.1 billion. Generation Y spent an additional $575 million on the category. Casual Living's exclusive survey presents demographic characteristics of both generations, along with where each bought outdoor furniture, how much they paid and how they paid.
Defining generations
Baby Boomers need no introduction. They're the largest generation ever — 78 million strong — and have dominated the retail scene for the past two decades. However, as the old song goes, the times they are a-changin'. The oldest Boomers turn 60 this year. According to the Census Bureau, 7,918 will turn 60 every day this year, about 330 every hour. Well-known Boomers hitting this milestone include President George W. Bush, Dolly Parton, Donald Trump and Susan Sarandon. While Boomers are still big buyers, casual furniture retailers need to look toward the next wave to sustain growth.
Lucky for us, the Boomers' children, Generation Y, are poised to take over where their parents leave off. Born between 1976 and 1994, the oldest of Gen Y turns 30 this year. Totaling 76 million, Gen Y appears to have inherited their parents' free-spending habits. Understanding Y's shopping habits as well as their living patterns, needs and desires will be key to maintaining the momentum the casual industry has enjoyed over the past few years.
Demographic differences exist between Boomers and their kids. In general, Gen Y is more ethnically and racially diverse and have lower incomes than Boomers. Among outdoor furniture buying households in each group, more than one-third of Gen Y have incomes of $75,000 or more, compared with 57% of Boomers. More than one-fifth of Gen Y outdoor buying households belong to a minority, compared with only 7% of Baby Boomer households.
Outdoor furniture buying
Lower incomes for Gen Y doesn't necessarily translate to buying lower-priced outdoor furniture, however. Generation Y actually spent slightly more, a median of $200 compared with a median of $155 for Boomers. More than two-fifths of Gen Y and more than half of Boomers spent less than $200 on their 2005 outdoor furniture purchase. About one-third of Gen Y spent in the $200 to $499 range, while 28% of Boomers spent that much. About one-fifth of each group spent $500 or more.
Another factor that makes Gen Y attractive to casual retailers: Boomers keep their outdoor furniture longer. Among the Boomers who had replaced their outdoor furniture last year, 70% replaced pieces they had owned for five or more years, compared with only one-third of Gen Y. And, two-thirds of Boomers say they'll keep the new furniture for five or more years, compared with about half of Gen Y.
Discount department stores garnered the most outdoor furniture sales for both generations. Half of Gen Y bought at a discount store, spending a median of $200. Forty-six percent of Boomers bought at Wal-Mart, Target, Kmart and the like, spending a median of $100.
Home improvement centers were more often the choice for Baby Boomers. Sixteen percent of Boomer households purchased outdoor furniture at Home Depot and Lowe's, spending a median of $200. Twelve percent of Gen Y did so as well, also spending a median of $200.
Twelve percent of Gen Y households purchased outdoor furniture at a specialty store last year, spending a median of $250. One-tenth of Boomer households bought at a specialist, too, spending 1.4 times more than Gen Y, a median of $350.
When it comes to outdoor furniture, consumers prefer to pay with cash. Three-fifths or more of both generations paid cash last year and about one-third of each group used a personal credit card. In-store financing is not popular with outdoor buyers. Only 6% of outdoor-buying Gen Y and 1% of Boomers used a retailers' no-no-no policy.
Outdoor Furniture Buying Households
| GEN Y | BOOMERS | |
| Source: Casual Living Consumer Buying Trends Shopping Attitudes Survey, 2005 |
||
| Household income | ||
| under $30,000 | 18% | 10% |
| $30,000–$49,999 | 16% | 18% |
| $50,000–$74,999 | 30% | 15% |
| $75,000–$99,999 | 16% | 24% |
| $100,000 or more | 20% | 33% |
| Marital status | ||
| now married | 64% | 80% |
| never married | 30% | 9% |
| divorced, widowed, separated | 6% | 11% |
| Home ownership | ||
| own or are buying | 68% | 82% |
| rent | 22% | 16% |
| other | 10% | 2% |
| Race/ethnicity | ||
| white | 78% | 89% |
| African-American | 6% | 3% |
| Asian-American | 6% | 1% |
| Hispanic | 10% | 3% |
| GENERATION Y | BABY BOOMERS |
| Born between 1976 and 1994 | Born between 1946 and 1964 |
| Adult members currently between 18 and 30 | Currently between 42 and 60 |
| Total 76 million — 27% of U.S. population | Total 78 million — 28% of U.S. population |
| One out of every three consider themselves a minority and three in four had working mothers | Lived through the longest period of national prosperity |
| Known as "echo boomers" and the "millennium generation" | Known as the "me" generation |
| Defining moments include 9/11 and the War on Terrorism | Defining moments include Woodstock, the Civil Rights Movement, feminism and the Vietnam War |
| Celebrity members include Britney Spears, Prince William, Justin Timberlake, Venus Williams, Ashton Kutcher and Beyonce | Celebrity members include Cher, President George W. Bush, Brad Pitt, Demi Moore, Denzel Washington, Dolly Parton, President Clinton and Susan Sarandon |
TOTAL 2005 OUTDOOR FURNITURE SALES $2.6 billion
| BOOMERS | $1,070 million | 41% |
| GEN Y | $575 million | 22% |
Payment Methods
| GEN Y | BOOMERS | |
| cash | 60% | 64% |
| personal credit card | 34% | 35% |
| in-store financing | 6% | 1% |
| other | &1% | &1% |
Budgets
| Generation Y | Baby Boomers | |
| Median | $200 | $155 |
| Percent of households spending | ||
| under $50 | 20% | 13% |
| $50–$99 | 14% | 20% |
| $100–$199 | 10% | 21% |
| $200–$299 | 20% | 12% |
| $300–$499 | 16% | 16% |
| $500–$599 | 10% | 9% |
| $600–$999 | 8% | 1% |
| $1,000 or more | 2% | 8% |
Where Bought1
| GEN Y | BOOMERS | |
| 1. The percentage of total number of purchases through each channel, not the percentage of total dollars spent through each channel. 2. Other includes direct-to-consumer, interior designers, craft/fabric stores, garden centers, feed & seed stores, hardware stores, supermarkets, drug stores, custom-made, rent-to-own and military exchanges, among others. Source: Casual Living Consumer Buying Trends Shopping Attitudes Survey, 2005 |
||
| discount department stores | 50% | 46% |
| other2 | 14% | 18% |
| home improvement centers | 12% | 16% |
| outdoor specialists | 12% | 10% |
| department stores | 6% | 3% |
| warehouse membership clubs | 4% | 4% |
| traditional furniture stores | 2% | 3% |
We would love your feedback!
-
Consumer Views: Spas
Nov 1, 2008 -
Specialty store buyers vs. big box buyers
Oct 1, 2007 -
Consumer Buying Trends
Jun 1, 2007
Featured Company
-
FurnitureCore.com
FurnitureCore.com is a dynamic web application aimed at the furniture industry. Retailers and manufacturers alike will find our deep reserve of tools to be exactly what their furniture business needs.www.furniturecore.com... more
VIEW ALL GALLERIES
