The growing market clout of the older generation

Older Americans are coming of age. At least as far as Madison Avenue is concerned. Long preoccupied with the statistically hefty baby-boomers and the lucrative youth market, advertisers and marketers are increasingly catering to older age groups.

Changing socioeconomic patterns, including a declining birthrate, rising life expectancy, and an increase in per capita income, are improving substantially the fortunes of the over-55 age group.

In response, advertisers and manufacturers are beginning to alter campaigns, update marketing techniques, and modify product lines. Today there is a growing array of goods and services, from travel packages to financial planning, designed specifically for a mature market. As a result, the so-called ''graying of America'' is beginning to appear on TV screens, magazine pages, and in product design.

''Five years ago, there were nothing but health ads that featured the elderly ,'' says Carole Allan, director of Allan Associates, a Maryland-based market research firm. ''But today older people are shown drinking Pepsi, reading Silhouette novels, doing many of the same things younger people do.''

''Madison Avenue has stereotypically portrayed older Americans as comic characters, senile, hard of hearing - (all) very negative images,'' says Joe Turner, a director of Gray Panthers Media Watch. ''Now we are beginning to see a slight turn (away from this).''

Traditionally considered a demographically and economically insignificant population segment that received largely limited treatment in the media, America's elderly are coming in for new and better exposure. Observers say it has as much to do with the ring of the cash register as the public's changed perception of aging.

''Even before the 1980 census it was well known that the seniors' market was going to be one of the fastest-growing population segments,'' says Clay Edmonds, marketing director of Ogilvy & Mather Partners, a New York advertising agency. ''The market simply follows the numbers.''

Following the numbers in this instance means being in hot pursuit of not only burgeoning statistics - recent census figures confirm the over-55 age group as the fastest-growing population segment - but also a mounting pile of dollars. Market studies indicate that the 30 million households headed by someone 55 or older have a projected after-tax income of more than $500 billion. Collectively they represent a $60 billion market and a per capita income 25 percent above average.

''That's not just discovering numbers, but dollars,'' says Betsy Gelb, an associate professor of marketing at the University of Houston's College of Business Administration. Ms. Gelb and other observers point to the continuing trend toward early retirement, social security indexing, and the growth of private pension funds as indicative of retirees' growing financial clout. They also say older citizens are leading active, full lives longer. With statistics indicating that more than 85 percent of all senior citizens still live in the community and not in care facilities, observers note that retirees' taste for consumer goods and services, while modifying in scope, nonetheless stays strong.

''With the trend towards early retirement remaining steady, people have a lot more time to travel and for other leisure activities,'' says Ms. Allan, adding that consumer-oriented companies are paying new attention to more mature markets. ''No longer is it just the health-care companies who are catering to the elderly. Cosmetic companies, retailers are all reconsidering the market.'' Among those starting to tailor their products to a more mature buyer are direct-mail houses, hotel chains, fast-food restaurants, clothing manufacturers, magazine publishers, travel agents, and some investment houses.

One company aggressively wooing the older customer is Sears, Roebuck & Co. Last January Sears, the nation's largest retailer, began Mature Outlook, a shoppers club providing a variety of consumer discounts and services to its members ages 55 and older. ''We started Mature Outlook because research showed this age group is a very affluent one,'' says executive director William Strauss. ''Sixty-eight percent of all funds held in money market accounts is controlled by someone 55 and older.'' In addition to retail discounts, the program offers members free portfolio reviews, insurance evaluations, and travel and real estate assistance through Sears subsidiaries, including Dean Witter Reynolds Inc. and Allstate Insurance.

While some people insist that such programs are simply novelties, that demographic changes can be misleading, and that indeed much of Madison Avenue is still in pursuit of America's youth, others point out that the gradual aging of the baby boom will only intensify the trend toward older markets. ''Baby-boomers want to see people like themselves,'' says Mr. Edmonds. ''Advertisers are no longer fearful that the average age of their product users is rising.''

Indeed, some advertisers point to the recent popularity of older models and actresses, such as television star Linda Evans in ''Dynasty'' and the positive perception of President Reagan's age as indicative of the public's changing attitudes toward aging. ''Beginning with industrialization, our culture became very youth-conscious and aging became a very negative trait,'' says Mr. Turner. ''But now we are beginning to see the demise of the youth-oriented culture, a little less of the blondes-have-more-fun and the Pepsi generation.''

''There is substantial purchasing power (in this age group),'' says Mr. Edmonds. ''But how the market reacts to this is not by pushing more dentures, but (changing) how they depict this market.'' Advertisements aimed at older markets tend to be more straightforward and heavy with consumer information, says Mr. Edmonds. ''Unlike the baby-boomers who tend to be very cynical about commercials, older people play by older rules. They are more willing to listen and read.''

The elderly are also more inclined to respond to spokesmen and models closer to their own age. ''Five to 10 years ago, older people were invisible in commercials,'' says one market researcher. ''But today products are (pitched) for everybody and they are using models that are active, gray-haired people.'' As a consequence, television- and print-ad campaigns are gradually featuring more older people, everyone from crusty John Houseman to the feisty ''Where's the beef'' Clara Peller.

At the same time, critics caution against overly glamorizing the aging process. Despite the rosy statistics, experts say, a significant number of older people, particularly women, still live below the poverty level. They say the use of exceptionally attractive older models, such as the 54-year-old Kaylan Pickford, is unrealistic of the market audience. ''Where do you find typical older models?'' asks Ms. Allan. ''A lot of people are waiting for this (part) of the trend.''