Who are HENRY’s and why should I care?
All marketers have heard of Millennials, Baby Boomers, DINK’s, and YUPPIE’s, but there’s a demographic that most brands are missing. HENRY’s. The ‘High-Earners-Not-Rich-Yet’ demographic that all marketers need to keep on their radar in today’s ever changing economy.
HENRY’s are stuck between the middle class, with incomes of $50,000 and $99,900, and the ultra-affluent, with incomes starting at $250,000. HENRY’s incomes are in the top 20% of US households, which in today’s economy starts a little above $100,000. Out of 123 million households in the US, the HENRY’s make up about 25 million of them. Most are middle age between 35 and 54 and they’re highly educated with having spent at least 10-15 years climbing the corporate ladder.
HENRY’s are the most important new consumer segment in today’s post-recession economy and the key to marketing success. There are 8 HENRY households for every one ultra-affluent, which means there’s great potential for growth for brands. They’re a demographic that marketers need to understand.
One point to note is that most HENRY’s are living from paycheck to paycheck. According to a recent survey by LendingTree, 44% of Millennials earning $100,000 to $149,000 live paycheck to paycheck. They give into buying urges and think they have to maintain a certain lifestyle. It’s a status symbol to them. Many HENRY’s are still paying off student loan debt, mortgages, car loans, however continue to purchase luxury items.
In the next 10 years, Millennials will account for a large portion of HENRY’s as they are willing to trade off earning extreme high levels of income to allow for more family time and to pursue their personal interests. They are content to maintain the HENRY level of income and not reach the top 2-3 percent of the ultra-affluent. This is important for all brands, but most importantly, luxury brands.
Luxury brands typically focus their marketing and appeal to the ultra-affluent, however by focusing on the up and coming HENRY’s, marketers will have an edge over the competition. Brands are starting to notice that the HENRY’s aren’t just for spin off or extension brands. They are an attractive market segment, and brands must develop relationships with this demographic today to continue learning about them as they mature.
According to Pamela Danziger, author of ‘What Do HENRY’s Want?’, “HENRY’s are the next mass-market for brands both up and down the pricing spectrum. The fact that the middle-class has lost so much spending power, the importance of HENRY’s to mass brands is growing by leaps and bounds.”
To target the HENRYs, brands should focus on justifying the price tag. Companies should use a value-based marketing approach that showcase the quality or superior materials of products. They are generally practical and want to spend their money on useful items. According to Danziger, “That’s why they spend so much on technology. The HENRY’s are willing to make sacrifices in one area to achieve a wealthy lifestyle.”
Marketers need to differentiate HOW their brand stands out from the competition. HENRY’s are not going to follow their parents’ loyalties when it comes to their lifestyles or brands. They will want their own. Marketers need determine now how to be ready for this rapidly growing demographic and be specific in their marketing efforts to best connect with this new consumer.
-Brittani Vanderweerd | Public Relations Specialist