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Where Are Those Xers, and What Are They Up To?
BNH interviewed Ken Gronbach, president and CEO of KGA Advertising of Middletown about changing demographics
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Business New Haven
4/5/1999
By: Tammy Rachau
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Can you briefly explain the recent Nielsen controversy?
The networks are taking issue with Nielsen, because the number of 18- to 34-year-old viewers has fallen off dramatically. The 18- to 34-year-old viewers -- to the networks -- are probably the most important block of viewers that they have, because for the past 50 years these viewers have been the group that has been chased by the people who market the products. In certain categories of products, the 18- to 34-year-old group spends more than anyone else.
But all of that has changed, and what the networks fail to realize is that this 18- to 34-year-old group right now is fully 40-percent smaller than it was 15 years ago. Now, you would think that the networks would realize that there's a dramatic fluctuation in the population that's causing the disappearance of their viewers in that category. But they don't realize this, any more than Detroit realizes it, any more than Levi's realizes it, any more than currently all the people that are building assisted-living [facilities] realize it.
So you believe the drop in the 18- to 34-year-old viewership is due to population decline?
Let me ask you a question: If you have 100 people in one group and 60 people in another group, and they're both the category that you want, and they both watch TV, which one of the two groups is going to watch more TV? Well, that's exactly what happened. Nielsen has been telling ABC, NBC, CBS that the decline has been dramatic since about 1992. The networks are not listening; they're not hearing it. They are reporting accurately; it's just that the 18- to 34-year-olds are gone.
Why do you think the networks are so adamant in denying these shifts?
Because it means so much money to them. Let me give you another example, because I had this same conversation with my publicist just recently. We stumbled onto this research about two and a half years ago. I was saying, 'Well, why aren't more people listening?' So my publicist said, 'Because what you're telling them is about to cost them a lot of money, and you're about to make them admit that they're wrong.' There are people right now who are building elderly housing -- and they're building it with a vengeance -- because they're looking into a rear-view mirror. Not realizing that the elderly people that they're seeing right now are part of a very large generation that was born between 1905 and 1925, two-thirds of whom have already died. If they build now, they're going to be attempting to fill their hospitals and rest homes with people who are born 1925 and later. From 1925 to 1945, there were only 30 million people born in 20 years. It's virtually a non-population. So they're going to go out of business.
What type of research is all of this based on? It's called generational research. We went back and pored over census data -- we're talking about the most objective data you can find -- this is from the U.S. Bureau of the Census with updates and also factoring in, to some degree, immigration. We know where there's a large group of this particular generation and a small group of this generation, and this is what we base it on. When you look at it on a graph, it's startling, because you have a mountain of baby-boomers, then you have a valley of 18- to 34-year-olds, then you have another mountain of kids under 17, which, incidentally, is actually larger than the baby-boomers, which few people realize.
In front of the baby boomers there's a giant hole called the 'silent generation,' and that goes for 20 years, and then 70-plus [year-olds] are the G.I. generation, and two-thirds of them are already dead. 'We've graphed out where the population is, and we've said, 'There's a large market here, a small market here, a large market here, and a small market here.' Right now Nielsen is having to defend the fact that the 18- to 34-year-old market is 40-percent smaller than it was 15 years ago, and the networks are saying it's because of Nielsen's reporting system, and Nielsen is saying it's because they're not there. And Nielsen is right.
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