Are North American mobile phone companies missing the boat by ignoring the exploding boomer market in favour of hip gadgets and services directed at those in their teens and twenties?
Newspapers, magazines, television and billboards are flooded with cellphone ad campaigns aimed squarely at the youth market, whose love of text messaging, social networking and, yes, chatting for hours on the phone are what largely drive the profits of service providers and hardware manufacturers.
In contrast, the boomer generation, whose high disposable income is coveted by so many industries, seems to be strangely overlooked by the mobile phone sector.
Because of the industry's obsession with marketing to the young, says Deloitte Touche, the international consulting company, it is missing a huge opportunity for growth. In its annual Technology, Media and Telecommunications Predictions report, issued recently, Deloitte says this scenario will likely continue this year.
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"The over-45s already hold a far greater share of the wealth of the world's most developed nations than the under-45s. Yet despite this the telecommunications industry can appear too focused on serving the youth market," the report says. "In 2008 this oversight is likely to continue even though it may be damaging to the sector's bottom line."
The marketing evidence is everywhere. Rogers Wireless ads don't feature grey-haired seniors, but rather teens and twentysomethings posting photos on Facebook and deciding who to choose for their MY5 Friends to receive unlimited local calls and text messages. This month, Bell Canada's big push was for a series of five cellphones that play music as well as those necessary text messages and voice calls.
Meanwhile, Telus Corp. has just launched Koodoo Mobile, a new youth-centred cellphone brand it hopes will snatch a larger share of services such as ring tones, music and text messages. And Rogers has unveiled its "wireless box office" service, which lets customers buy concert tickets online using their cellphone.
But looks can be deceiving, say other industry experts. They suggest that Deloitte researchers have misunderstood the basics of the mobile phone business in Canada. Yes, all carriers are targeting young customers, but that is because they represent an easily identifiable market compared with the widely diverse preferences of older consumers.
"The matter is not as simple as it would seem," says Lawrence Surtees, vice-president of telecommunications research at IDC Canada. "The youth market is low-hanging fruit. They are early adopters of technology, are easily identifiable and easily targeted in marketing campaigns."
Then there is the fact that in Canada, the main competitive focus is to simply collect subscribers, no matter who they are, says Eamon Hoey of Hoey Associates, a Toronto telecommunications consultant.
"We are nowhere near the stage where carriers are competing for market share in niche markets, such as seniors versus youth," he says. "Right now the business is all about signing up subscribers."
Marc Choma, spokesman for the Canadian Wireless Telecommunications Association in Ottawa, the mobile phone industry's trade group, does not disagree. But he says that, despite the highly visible youth campaigns, seniors are already a major force in the industry.
"Subscribers aged 55-plus have been our fastest growing sector for some years now," Mr. Choma says. "We have been adding 1.5 million new subscribers a year, and in 2006, 48 per cent were aged 55 or older. That compares with just 25 per cent in 2000."
So why does it seem that young people are the only market?"That's because the youth market were early adopters," he says. "The business market was next, and now as business people get more used to the technology and see its value, the mobile companies are responding to their specific needs."
Bell Canada spokesperson Jeff Meerman says: "Our marketing efforts vary based on [identifiable] markets but we don't specifically target people 45 and older. That said, specific campaigns or offers may appeal to that age group."
Duncan Stewart, director of research for technology, media and telecommunications at Deloitte Canada and one of the authors of the report, is unimpressed by such explanations.
"No matter what the phone makers and carriers say, I know for certain that some 24-year-old designer creates a phone and takes it to his 18-year-old cousin and says, 'What do you think of all these cool features?' " Mr. Stewart says. "If the cousin likes it, the phone makers produce it and the carriers promote it."
But targeting the youth market - as opposed to seniors - can be less than successful when it comes to customer retention and can prove a bad business strategy, he adds.
"Look at the cost of creating those [youth-oriented] campaigns versus return," Mr. Duncan says. "The youth market has a huge churn rate. They jump from carrier to carrier, and phone maker to phone maker, to get the latest service or gimmick."
Phone makers do in fact produce handsets aimed at older users, but it is up to the carriers in Canada to market them, according to David Dzumba, a senior manager with Nokia Corp. in Irving, Texas.
Phones are available in Canada with speech-to-text options or special audio adjustments for those with hearing loss - two features that aging eyes and ears will value, Mr. Dzumba points out. There are also speech-controlled dialling options and phones with adjustable type sizes.
What most seem to agree on is that time will resolve the youth-vs.-senior emphasis.
"The big impact, the big change will come when those in their 40s today become seniors," predicts Deloitte's Mr. Stewart. "They are tech-savvy and will demand that all their communication essentials - like BlackBerrys, PDAs and mobile phones - be designed to meet any challenges that aging presents."
Mr. Hoey sees it slightly differently: "Until the carriers have to start fighting for market share, they won't pay much attention to identifiable niche markets."
