By: Jim Olsztynski, Special to Midwest Distributors Association (MwDA)
The Midwest commercial market is humming – at least relative to recent years. ASA and MwDA reported significant membership gains. Many attendees were buoyed by reports of change in the air on the eve of Election Day. All of these reasons combined to make the 2014 annual meeting of ASA’s Midwest Distributors Association the group’s best attended and most cheerful session in years.
Held Nov. 3 at Ditka’s restaurant in Oak Brook, IL, the meeting featured a fascinating keynote speaker. Matt Carmichael, editor of Livability.com, is a journalist-turned-data cruncher who formerly headed market research at Crain’s Chicago Business and directed data strategy at Advertising Age. His presentation culled some highlights from his book, BUYographics, which focuses on demographic shifts in America and how they impact business.
His main message was how fragmented our society has become. Marketers no longer can succeed targeting Beaver Cleaver’s middle-class family consisting of Mom, Dad and 2.5 kids living in the suburbs. Today’s middle class is all over the ballpark, ranging from households with two working parents to single Dads with weekend custody to gay couples to you name it. You will tie yourself in knots trying to define the “average American.” Therefore, businesses with products and services to sell need to define their audiences (emphasis on the plural) with greater precision and with messages targeted to different lifestyles.
Some of Carmichael’s striking observations were:
- The rich indeed are getting richer. Over the last 40 years the median income has risen 13%, but the top five percent of earners have seen their incomes grow by 80%. The median income has not changed all that much but the mean (average) income has grown quite a bit.
- The Baby Boomer generation is giving way to the so-called Millennials, some 12,000 of whom are turning age 30 every day. But the buying habits of Millennials bear no resemblance to that of their parents. Most significant, they are not purchasing homes at nearly the same pace. Mainly it’s because they can’t afford them, and even those who hold jobs with sufficient income are less confident of job stability and future earning power. They are more likely to move to where the jobs are, and they don’t want to be tied down to homes with mortgages, especially after seeing so many of their parents’ homes go underwater in the recent recession.
- Added to the issues cited above, many Millennials are bogged down by student loan debt, which makes it hard for them to get credit and afford down payments. That’s why so many are living with Mom and Dad.
- Who, then, is buying homes? An astounding 40% of home sales, these days, are all-cash deals, mainly by investors. This means more multi-family homes in relation to single-families.
- As for the baby boomers, some 60% of retirees have less than $100,000 in retirement savings. Coupled with so many homes underwater, they are much more likely to stay in place than retire to other parts of the country. This augers well for remodeling. It also means the vacation home market is likely to be moribund for years to come.
The event concluded with the members electing the slate of MwDA officers and directors for 2015. Dave Poteete from M. Cooper Supply Co. in Mokena, IL, will continue to serve as President; President-Elect is Todd Restel from First Supply in La Crosse, WI; Treasurer is Ryan Curry from Connor Co. in Peoria, IL. At-Large Directors serving on the Board are John Bennerotte from BMA in Plymouth, MN; Michael Dore from R.C. Sales & Service in Downers Grove, IL; Randy Grebel from Bemis Manufacturing; Monica Moore from InSInkErator; David Riggs from Plumbers Supply in St. Louis, MO; Greg Servais from Dakota Supply Group in La Crosse, WI; and Bill Zielinski from Chicago Tube & Iron Co. in Romeoville, IL.
To learn more about MwDA and membership, visit MwDA's page and website. Or contact Chris Murin at (630) 467-0000 x204 or firstname.lastname@example.org.