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Bargain boom: the nation's 76 million baby boomers are becoming eligible for AARP offers

Insight on the News, July 29, 2002 by Donna De Marco

Americans born between 1946 and 1964 are one of the country's largest demographic groups, making up 26 percent of the population. The heart of the baby-boomer generation, those aged 45 to 54, have a median income of $56,917, according to 1999 figures from the U.S. Census Bureau--the highest median income among all age groups. "Everyone is going to want a piece of that market," says David Smidt, president of Senior Discounts.com, a Website that tracks thousands of senior discounts.

AARP, formerly the American Association of Retired Persons, started offering discounts for its members older than 50 in the early 1970s. Avis was the first to sign on, followed by Hertz and Sheraton Hotels. Today, with more than 35 million members, AARP offers more than 70 discounts, from percentages off hotel rooms to reduced prices on Internet service providers.

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"Companies do this presumably for self-interest" says Tom Otwell, an AARP spokesman. "This is a marketing tool. And as the population ages, some companies may feel that it is a plus"

Some businesses are reluctant to offer deals because the growing number of eligible people would cut into their profits. Last year, Delta Air Lines and American Airlines eliminated their senior discount clubs. Still, trend-followers say the number of discounts is growing.

"More and more businesses are getting on board" says Joan Rattner Heilman, author of Unbelievably Good Deals and Great Adventures That You Absolutely Can't Get Unless You're Over 50, getting ready for its 14th edition. I have not seen anything diminishing"

According to Otwell, rather than AARP having to recruit companies to be a part of its discount smorgasbord, companies contact AARP. "We're continuing to see businesses coming to us" he says. "I don't think you're going to see a drop-off" in discounts offered through the AARP membership. AARP charges a $12.50 annual membership fee.

"Seniors are so loyal to the companies that offer discounts," says Smidt of SeniorDiscounts.com, which in its first year has grown from listing 25,000 to more than 118,000 discounts and values on its Website. "If a business drops, seniors will go somewhere else and become loyal to that company"

The travel industry, particularly hotels, is at the top of the list of industries offering discounts. "Seniors have an awful lot of disposable income, and they travel" Heilman says. "Companies are trying desperately to get these people to fill seats and fill beds."

Marriott Hotels & Resorts, for example, offers 50 percent off room rates to AARP members if the reservation is made 21 days in advance (they enjoy 10 percent off last-minute reservations). The chain also offers members 20 percent off food and nonalcoholic beverages at its restaurants, even if they aren't staying at its hotel. "The senior market is very important to us, especially since it's growing" says Scott Carman, a spokesman for Marriott International, which offers various AARP discounts at seven of its brands, including Renaissance Hotels, Fairfield Inn and Towne-place Suites.

Southwest Airlines started offering senior fares in 1985 for those 65 and older. At the time, ticket discounts were $25 each way during restricted times. They now range from 20 percent to 67 percent anytime. Prices are capped at $129 each way. Last year, 2 million Southwest passengers took advantage of senior fares. "We don't plan on taking that away from customers," says spokeswoman Brandy King, who notes that senior discounts aren't always the cheapest at the airline.

About 30 percent--nearly 800,000 passengers--on Carnival Cruise Lines are older than 55. The cruise line offers AARP members savings of $50 to $100. "This is an important group for us" says Vicki Freed, the cruise line's senior vice president of sales and marketing. "They have the time and they have the discretionary income."

The majority of Norwegian Coastal Village's passengers are 60 or older. The cruise line offers AARP discounts that can be used in combination with its own discounts, which include senior savings of $95 to $220 per person for those older than 67.

Retailers also have started dedicating one day a week to discounts for seniors. Ames Department Stores, which started its 55 Gold Savings Club in 1995, offers 10 percent off on all merchandise every Tuesday to those 55 and older. Company spokeswoman Amy Romano wouldn't disclose specific sales figures but says the club "has been a very, very successful initiative for us" The retailer has more than 2 million active club members.

Despite the growing number of those eligible for discounts, Ames isn't worried about its bottom line. The program has helped make Tuesdays one of Ames' busiest shopping days, Romano said. Ames stores open an hour earlier than usual Tuesdays.

Bargain boom: the nation's 76 million baby boomers are becoming eligible for AARP offers

Insight on the News, July 29, 2002 by Donna De Marco

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