Gen Xers, born between 1965 and 1980, grew up with MTV and empty houses, earning them the name “latchkey kids.”
The first generation who logged onto AOL Instant Messenger and played video games while still enjoying the freedom that came before helicopter parents took over is fascinating. But as a small generation that falls between baby boomers and millennials, they’re often overlooked.
When it comes to their spending power, however, Gen X is small but mighty. According to a new report from ICSC, a trade association for retail real estate, Gen X may have more spending power than brands realize.
While Gen X only makes up around 19% of the U.S. population, the demographic is responsible for 31% of online and in-person spending, the report finds.
Not only do Gen Xers buy more in stores than baby boomers, millennials, and Gen Z across categories (luxury, fitness, and total retail costs), they’re also driving spending on dining out.
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Per the report, Gen X is responsible for nearly one-third of all restaurant spending.
Tom McGee, president and CEO of ICSC, said in a press release that Gen X is “the powerhouse driving today’s retail economy, spending more per shopper than all other generations.”
Outsized spending impact in five states
According to the report, Gen Xers are such powerful spenders that their mere presence in locations across the United States actually has a major impact on the market in that area.
More than one-third of the generation’s population lives in just five states: California, Texas, Florida, New York, and Pennsylvania, and their spending is impactful.
It’s especially evident in Florida cities like Miami, West Palm Beach, Fort Lauderdale, as well as Houston, Texas, and more.
We know that younger shoppers tend to be deeply loyal to the brands they love. But Gen X is exceptionally set in their ways, too. No big surprise. I mean, have you ever met a Gen Xer? You can’t convince them to love something they hate and vice-versa.
That’s likely why 81% of latchkey kids say they are loyal to the brands they trust—and they probably always will be.
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“Gen X is pragmatic, loyal to brands they trust, and influential decision-makers for themselves, their children, and their parents,” McGee says. “For retailers, there is no bigger near-term growth opportunity than winning the loyalty and the dollars of Gen X.”
Gen X isn’t just spending more than other generations. They’re also plugged in online, as they are massively tech-savvy, using online tools like social media regularly. According to the report, 92% of the generation is on social media daily.
Still, brands aren’t marketing to them. Only 5% of brand influencing spending targets Gen X, which experts say is a huge mistake.
“They’ve got wealth . . . They may be looking to start to make that semi-retirement-type transition,” Ryan Marshall, president and CEO of PulteGroup, a homebuilder, says in the report, “but they still consider themselves to be very young and active.”
Those factors definitely seem to promote spending. But soon, that may be especially true of Gen X, as a major transfer of wealth is about to take place. Around one in three Gen Xers expect to receive an inheritance, which could come out to around $308 billion annually in spending.
While Gen X’s lingo may be lowkey dated, their currency still works. Brands may be focused on appealing to on-trend millennials and Gen Zers, but they’d be wise not to write off the MTV kids just yet.