It’s no secret that the American middle class has been the stalwart of this country.
This group has been the backbone of society who worked tirelessly, spent, and invested in the American dream. Through the generations the middle class was able to achieve heightened career and financial status. This feat was something that many of their parents’ generation may not have been able to accomplish.
Middle class is defined by Pew Research Center as those households earning 67 percent to 200 percent of their state’s median income. Put another way, the middle class contains households which are two-thirds to double the national median income. With a household size of three, salaries could possibly range anywhere from $42,000 to $200,000 per year depending on the household’s domicile and economic sources.
Additionally, households that are a part of the middle class could take on other psychographic subtexts, too. Marketers use more than income to classify and define marketing targets. It can include these identifiers: some college or college graduate, white/blue-collar employed, level of economic security, own/rent a home, and/or social/political morals. Given the scale of this group over the years, it stands to reason why marketers valued and depended upon this group so much to sell a plethora of products and services.
Recent history has changed the dynamics of the middle class. Between 2007 and 2009, the housing market bubble burst and the “Great Recession” cloaked the country. This had a decided impact on this demographic. Wealth accumulation has declined within the middle class. This group has seen job losses—in particular manufacturing jobs and businesses that supported them—salary reductions, tax increases, and cost of living increases. All of these factors have directly impacted the middle class’ discretionary spending.
Marketers who have products and services that appeal to the middle class have looked to execute a number of tactics to keep their revenue stream profitable. Pricing promotions have been vital. But, marketers have also looked to expand who they are targeting. Quick-service restaurants (QSRs, or fast-food restaurants) and casual restaurants are a good case study to examine. Casual restaurants such as Red Lobster, Chili’s, and Applebee’s have primarily catered to the middle class. With the aforementioned consequences of the “Great Recession,” these restaurants used price and promotions to attract new customers. By doing so, they gained business from customers who typically were deemed QSR consumers. This cut directly into the customer base of many QSRs. Now, these same QSRs expanded their competitive set given the encroachment seen by casual restaurants.
As you evolve your marketing plans, consider tapping into consumers who typically have not been your traditional customer bases to increase profitability. Consider what needs those consumers have and how you can align your products to fit those needs.
Every business is looking for growth and 2016 will surely prove to be just as competitive as 2015. Think beyond your past tactics because your competitors are definitely looking for ways to chip away at your share.
Adele Lassere is a marketing/advertising consultant with 20+ years experience, freelance writer and author of “Elements of Buying” (a self-help advertising guide), available at Amazon.com. Adele was listed as Black Enterprise’s 2011 Top Execs in Marketing & Advertising and Black Enterprise’s 2013 Top Women Executives in Advertising & Marketing. Contact: firstname.lastname@example.org