Leisure spending poised for generational shift

Casino, travel and cruise line companies must adapt as millennials take over from boomers as the dominant force.

Ashley Redmond 27 May, 2014 | 6:00PM

For the baby boomers -- those born between 1946 and 1964 -- life should be pretty sweet right now. They are at or nearing retirement, and after years of working they finally have some extra cash to throw around. In fact, they represent approximately 70% of all disposable income in the United States, according to a study done in 2012 by Nielsen (comparable stats in Canada aren't available, but we can safely assume that our numbers would be similar). Predictably, companies are bending over backwards to appeal to this age group that controls such a large portion of the wealth.

Research by Morningstar equity analysts shows that boomers tend to base their leisure spending decisions on convenience and perceived value, and they spend more time than any other generation researching alternatives. For example, if they are booking a 10-day trip to Italy, they likely enjoy being able to independently book hotels and flights through online providers such as Expedia EXPE or Priceline Group PCLN, while maintaining the option of physically going to a travel agency.

But boomers' domination over the way leisure providers offer their services won't last forever. Millennials -- those born between 1980 and 1999 -- are about to enter their peak discretionary spending period over the next 20 years, and they are poised to take over as the main players in leisure spending -- and I can't imagine a millennial physically walking into a travel agency; it sounds like an SNL skit to me.

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Ashley Redmond

Ashley Redmond  Ashley Redmond is a Vancouver-based freelance writer.