Business

Singles’ incomes, buying habits attract marketers

Whole Foods is holding wine tastings. Ikea is pitching apartment furniture to divorced dads. Applebee’s turns into a nightclub after dinner.

These companies are all targeting an increasingly coveted demographic: single Americans.

More than half of U.S. adults are now unmarried – a 125- million-strong cohort that spends about $2 trillion on goods and services a year, according to the Bureau of Labor Statistics. Economist Edward Yardeni calls them Selfies, who are free to spend selfishly because they’re not saving for college, paying off a mortgage or buying clothes for their kids.

“They’re self-centered by definition,” Yardeni said in a telephone interview. “They spend money on themselves or they’re saving it for consumption down the road.”

Consider Molly Louthan, 31, who earns about $130,000 a year as a sales associate at Advancing Women Executives, a networking firm. She lives by herself in an upscale high-rise overlooking Chicago’s Lincoln Park and has the freedom to eat out most nights and travel often. Louthan has no immediate plans to get hitched.

For decades, companies from Procter & Gamble Co. to Kraft Foods targeted traditional families traveling predictable life stages, from buying homes to having kids to retiring. Marketers focused mostly on mom, who controlled the household budget and decided what her family would buy.

Now they confront a more fragmented and confounding marketplace, where their target customer could be a millennial too focused on career to tie the knot, a proudly single woman in her 30s who privately pities her married pals or an empty-nester who just got divorced.

“It’s very difficult to target them because there’s so much variety,” said Christopher Lehmann, a Chicago-based executive creative director with Landor Associates, a global brand consultant. “There’s a danger in thinking of it as one big target audience.”

Singles are increasingly seen as a target market in other industrialized nations, including Britain, Japan and South Korea. In China, Alibaba Group Holding has capitalized on a Nov. 11 holiday called Singles Day. Merchants offer discounts of at least 50 percent and this year rang up $50 billion yuan ($9.3 billion) in sales, according to Alibaba, an online shopping company.

Though America has been getting steadily more single since the 1970s, the economic upheaval of the past several years has accelerated singlehood. In September, Yardeni reported that for the first time more than 50 percent of Americans 16 and older are single. Back when the government started tracking the metric in 1976, 37 percent of adults were unmarried.

Millennials, grappling with a tough job market and stagnant wages, are delaying marriage so they can focus on their careers. That in turn means delaying kids and a house in the suburbs. As a result, they aren’t buying big-ticket items like lawn mowers, washing machines and SUVs. They also eat out a lot and tend not to fill up their shopping carts with a week’s worth of groceries. That’s bad for Kraft but good for premium fast-food chains like Chipotle Mexican Grill.

Martin Dieffenbach, 33, moved to San Francisco about six months ago for a job as a sales manager at a technology company. He’s been to the grocery store twice since moving into the Mission District house he shares with three roommates.

Dieffenbach, who says he makes about $160,000 a year, usually eats two meals a day in the company cafeteria and often goes out with friends after work. If he’s at the office late, he'll grab a sandwich on his way home. With no mortgage or car payments, Dieffenbach can golf and ski and still put money away.

Increasing numbers of baby boomers are single, too. The divorce rate among people 50 and older doubled between 1990 and 2010, according to the National Center for Family and Marriage Research at Bowling Green State University, in Bowling Green, Ohio. In 2010, about 25 percent of divorces were among adults over 50.

A record number of Americans have never tied the knot, according to a recent survey by the Pew Research Center. In 2012, 20 percent of adults 25 and over had never married, up from 9 percent in 1960. Back then, 10 percent of men over 25 had never married – that number jumped to 23 percent in 2012.

Even as companies struggle to reach singles, they are loath to alienate the 49 percent of married Americans or those in committed relationships. Or, for that matter, people who want to wed but haven’t found a mate.

“You’re not likely to see an ad that says ‘Congratulations, you’re single,’” said Anastasiya Pocheptsova, who teaches marketing at the University of Maryland’s Robert H. Smith School of Business in College Park. “You always want to compliment the consumer.”

So even though companies now have reams of data to target ever narrower niches, many have adopted an oblique approach. Rather than target singles directly, they’re going after broader categories, such as city dwellers and millennials.

“They’re not saying it out loud, but the offerings are targeted at people more likely to be single,” said Pocheptsova. “It takes time for social norms to catch up with reality.”

Restaurant chains and grocery stores are less squeamish about targeting singles directly, especially younger ones who tend to snack throughout the day or eat out rather than sitting down for elaborate family dinners. Kraft has responded with “on-the-go” options like the Oscar Mayer P3, a protein pack with cheese, nuts and meat. Whole Foods offers packaged food that’s ready to cook, and customers cooking for one can go home with butchered meats and produce designed for a single serving.

Some Whole Foods locations have in-store tap rooms and wine bars and have hosted speed dating events for “successful singles” ages 25 to 38. At the Whole Foods in Monterey, Calif., there is a “Singles Night” the week before Valentines Day where customers can sample wine, sushi and beer. Last year, a pianist was on hand to set the mood.

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