Demographics will force marketing changes.

DEMOGRAPHICS WILL FORCE MARKETING CHANGES

Demographic shifts in Canada will prompt businesses to target their marketing efforts, says Colin Deane, co-author of the Clarkson Gordon/Woods Gordon publication Tomorrow's Customers. Released recently, the publication forecasts marketing and economic trends over the next decade, emphasizing Canada's expanding role in the North American market.

By the year 2000, marketers will face the challenge of a mature population, representing the most knowledgeable consumers in North American history. According to the U.S. Conference Board, the older baby boomers (born 1946-54) will control 40 per cent of spending power by the year 2000: A substantial portion of this will be spent on mortgages, children and aging parents. This group will allocate more available income to housing (31 per cent of expenditures) than will any other age group, but will be affluent enough to be major purchasers of discretionary products and services.

Over the coming decades, the North American population will continue to shift from a predominantly European background to one of more diversity. Newer arrivals, such as Asians in Canada and Hispanics in the U.S., will become the major ethnic groups in more areas. In both countries, immigration will become increasingly important as a source of workers for labor-intensive service industries. Immigrants are also needed to bring particular skills to those areas where North American training has been inadequate and where generations of skilled immigrants are beginning to retire.

North American's population will continue to grow slowly to the end of the century, averaging less than one per cent growth annually, according to Tomorrow's Customers. By the year 2000, the U.S. population will be 286 million and Canada's 29 million. Slower growth rates affect market growth for certain products and services including new houses, appliances, furniture and other durables. Slower means more competition for available business as companies in mature industries strive to maintain real growth rates higher than the market as a whole.

This competition will be intensified under the Free Trade Agreement, product and marketing innovations will be essential for success, with marketing efforts increasingly focused on the replacement market," says Deane.