1Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Doug Anderson

doug@statsprocket.com

The New Face of OpportunitySelling in a Changed & Changing World

2Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

3Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Key 21st Century Macro Trends

Slowing Population

Growth

Declining Share of HHs with

Children

Immigration & Growth of Ethnic

Families

Many Older Consumers with

New Needs

Income Declines & Concentration

Rising Rate of Obesity & Cost of

Healthcare

4Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Uneven Global Population Growth Continues

19501955

19601965

19701975

19801985

19901995

20002005

20102015

20202025

20302035

20402045

2050 -

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

10,000,000

More developed regions

Other less developed

India

Africa

China

Source: UN Population Division 2010 Revision

5Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Uneven Global Population Growth Continues

19501955

19601965

19701975

19801985

19901995

20002005

20102015

20202025

20302035

20402045

2050 -

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

10,000,000

More developed regions

Other less developed

India

Africa

China

Between 2010 & 2050...+2.24 billion people (+32%)

Only 1.7% from the More Developed Regions

Source: UN Population Division 2010 Revision

6Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Share of HHs with Children in Freefall

1950 1956 1962 1968 1974 1980 1986 1992 1998 2004 2010 2016 2022 2028 2034 2040 204625.0

30.0

35.0

40.0

45.0

50.0

2011 – all time low birth rateDown 7% from 2007 to 2010

5% for native born / 13% for foreign born

Source: U.S. Census Bureau, Nielsen Projections

7Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Rapid Ethnic Growth Among HHs with Kids

Africa, Asia, Latin America, Middle

East

United States, Canada, Europe,

Australia

Immigrant Flows20MM+ per decade

Young people leave for opportunity

Leads to rapid growth in ethnic

populations among families

Bring families or start new ones

Multi-cultural populations accounted for 90%+ of HH growth (2000–10)

New immigrants & their children will account for 80%+ of growth going forward

Will account for all growth among HHs with children

8Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

The U.S. Will Age for a Very Long Time

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

2010

2015

2020

2025

2030

2035

2040

2045

2050

2055

2060

2065

2070

2075

2080

2085

2090

2095

2100

25.0

27.0

29.0

31.0

33.0

35.0

37.0

39.0

41.0

43.0

45.0

U.S. Median Age

Source: UN Population Division

9Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Growth at the Bottom of the Income Distribution

Struggling Lower Mid Upper Mid Affluent Wealthy2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

Source: Nielsen Projections

Projected HH Growth Rates by Affluence Segments 2011 – 2021

Total U.S. Growth 7.8%

10Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Obesity Rate Continues to Rise

Non Hispanic White Men

Non Hispanic Black Men

Mexican American Men

Non Hispanic White Women

Non Hispanic Black Women

Mexican American Women

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

50.0

1988-94 2007-08

44% Overall by 203010x increase in obesity related disease from

2010 to 2020, doubling again by 2030

Source: NHANE

11Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Implications for the Future of Three Key Marketplace Groups

• Baby Boomers

• The New American Family

• Millennials

The New Face of OpportunitySelling in a Changed & Changing World

12Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

43% Verizon wireless42% ATT / 36% Sprint

40% of CPG Spending

43% Sony Vaio41% Apple iBook /

iMac

Baby Boom

Source: Nielsen Homescan / MRI

13Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Baby Boomers – - over half of persons who have held or run for political

office- 44% of those who worked for a political party last year

Baby Boom

Source: MRI

Millennials; 18.1

Gen X; 18.5Baby Boom; 42.2

Pre Baby Boom; 21.2

Percent of Voters

63%

14Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Mind the Gap – Lifestage & Cohort Effects

Volume Indices

ItemHOH 40-

64 HOH 65+ GapFrozen Prepared Foods 105 73 31.6Frozen Pizza 104 56 47.9DiGiorno Frozen Pizza 102 63 38.7Packaged Ice Cream 104 110 -6.4Dreyers/Eddie's 96 121 -24.9

Source: Nielsen Homescan

15Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Lifestage StrugglingLower Middle

Upper Middle Affluent Wealthy Total

HOH <40 / Single Parents 11.8 4.7 2.3 1.5 2.2 8.0

HOH <40 / Couples16.0 6.1 2.5 1.8 2.7 6.1

HOH 40+ / Single Parents 11.2 2.3 -2.0 -4.1 -5.1 3.8

HOH 40+ / Couples 17.5 6.0 -1.2 -4.4 -5.4 0.9

Total 13.6 5.1 0.4 -1.9 -2.8 4.3

Family Growth About Half of Total HH Growth

Percent Change in the Number of U.S. HHs with Children: 2011-2021

HHs with Children Account for 47% of Frozen Pizza Sales

Source: Nielsen Projections / Nielsen Homescan

16Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Slow Growth in Family HHs, But a Lot of Flux

White

Black

Asian

Other

Hispanic

-10.0 0.0 10.0 20.0 30.0

Source: Nielsen Projections

2011–2021 HH Growth

Struggling

Lower Middle

Upper Middle

Affluent

Wealthy

-5.0 0.0 5.0 10.0 15.0

17Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Household Composition Will Continue to Shift

1960 20080

10

20

30

40

50

60

70

80

90

100

87

64

% Children Living with Married Parents

1960 2008

5

41

White Black Hispanic

29

72

53

% Children Born to Unmarried Parents

Source: U.S. Census Bureau

18Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

Percent Married by Education

1960 1970 1980 199050.0

55.0

60.0

65.0

70.0

75.0

80.0

Less Than High School High School / Some CollegeCollege Graduate

Source: U.S. Census Bureau

76%

71%

74%

64%

50%

44%

19Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

18901920

19471950

19531956

19591962

19651968

19711974

19771980

19831986

19891992

19951998

20012004

200720.0

21.0

22.0

23.0

24.0

25.0

26.0

27.0

28.0

29.0

Men Women

Median Age at First Marriage

Source: U.S. Census Bureau

20Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

18901920

19471950

19531956

19591962

19651968

19711974

19771980

19831986

19891992

19951998

20012004

200720.0

21.0

22.0

23.0

24.0

25.0

26.0

27.0

28.0

29.0

Men Women

Median Age at First Marriage

In 1968 68% of persons in their 20s were married

Today 26% are

Source: U.S. Census Bureau

21Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

The State of Marriage in the Future?

39% in a recent Pew survey agree that marriage is obsolete

- 44% of 18–29- 45% of High School or Less

- 48% of HHI < $30k

Marriages have become more peaceful with lower levels of conflict

Spouses are living more separate lives with fewer shared activities

22Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

2010

2012

2014

2016

2018

2020

2022

2024

2026

2028

2030

2032

2034

2036

2038

2040

2042

2044

2046

2048

2050

40,000,000

50,000,000

60,000,000

70,000,000

80,000,000

90,000,000

100,000,000

110,000,000

60+ 21-34

No Growth Among 21-34 Year Olds, But…

Source: U.S. Census Bureau

23Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

MillennialsEconomics

• Entering society in tough times and having a tough time doing it

• Most educated generation in history but still can’t get a job

• Minimal fifteen year impact to earnings

• Many have headed back home to Mom & Day

24Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

MillennialsNot Tying the Knot

• Marrying later if at all, staying single longer, much more likely to cohabitate

• Will have fewer children further slowing U.S. growth rate

• Less tied to the idea of creating their own families & much more tied to their parents than earlier generations at their ages

25Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

MillennialsFully Multi-Cultural

• Most multi-cultural adult generation in history

• See diversity as desirable & attractive

• New & different tastes

• Language diversity & new cultural sensitivities

26Copyright © 2012 Douglas B. Anderson. Confidential and proprietary. The New Face of Opportunity

MillennialsCommunicate different

• Always had a mobile phone

• Texting, networking, sharing

• Different attention spans

• Have only lived in the post-fact era, have new & different standards for evaluating messages

• Not reached well through traditional channels & media

Some Key Things to Take Away

The future is now…

Demographic change is fundamental, widespread, & permanent, and interrelated

Growth is down / competition is up…

More products +Slow growth =

Increasing competition

Boomers• Must sustain sales

• Understand lifestage & cohort effects

• Can’t ignore / can’t talk down

• Multi-cultural or bust

• Precisely target

• Non-traditional family arrangements

New American

Family

• New geographies

• New media

• Crazy levels of competition

Younger Consumers

Questions?