At first blush, the exercise class does not seem out of the ordinary.
But a closer look makes it clear it is far from the usual bend-and-stretch session. For one thing, the women, all clad in colorful leotards and warm-up suits, are at least 60 years old.
Perhaps even more significant, the class is taking place in a department store room that, until recently, housed the children's clothing department.
The class is part of Hecht's Older Adult Service and Information System, better known as OASIS, and only one of a myriad of activities that goes on all week for senior citizens in Hecht's Reisterstown, Md., store.
Offered in Reisterstown and eight other stores around the country that are owned by Hecht's parent company, May Department Stores Co.,OASIS is one of several new senior-citizen programs being touted by the nation's retailers.
With the elderly representing the fastest-growing market in the country -- and the one with the most discretionary money to spend -- many merchants are paying greater attention to the "gray" market.
Sears Roebuck & Co., for example, last year founded the Mature Outlook Club, which, for a $7.50 annual membership fee, offers a host of discounts on a variety of products and services, including many from Sears, to anyone older than 50. Montgomery Ward sponsors a similar program through its 4-month-old YES (Years of Extra Savings) club.
K mart Corp., the nation's second-largest retailer after Sears, also went after the elderly market last Christmas season when it set aside two hours on a December Saturday morning for a "senior-citizen shopping spree." The chain offered special services, including chairs in the aisle, transportation, gift-wrapping, mailing services as well as refreshments.
Offering special services, such as discounts and shopping aid, to the elderly is far from new. Retailers, restaurants, airlines, hotels and other institutions have long given special rates and help to senior citizens.
What makes this new marketing strategy different, however, is the attitude expressed by retailers. As Bill Strauss, executive director of Sears' Mature Outlook, noted: "Before, you gave discounts because the elderly couldn't afford things. Now, it is entirely different. The new programs are being offered because they the mature market represent a major opportunity market."
Strauss said Sears came to that conclusion after the chain reviewed the 1980 census data.
"We became very aware that the 50-and-up market was the fastest growing market and would continue that way well into the second century," he said. "There are more than 60 million citizens over 50 in this country, representing about 25 percent of the current population. Yet they control 50 percent of the discretionary income available for spending. That's two times the power of their numbers," he said.
"And they account for 77 percent of all financial assets controlled in the United States. You start to look at these kinds of statistics and as a mass marketer, which is what Sears is, it became very apparent that as a company we had to position ourselves much more strongly than before to this new market," he added.
Although senior citizens' income may be less than their pre-retirement earnings, numerous studies have shown that, as a whole, they still have more money to spend for luxury items than other segments of the American population.
For the most part, their children are grown, their houses are paid off and they receive special tax breaks. As a result, they don't need as much money as they did in the past to pay for necessities.
What's more, retailers note, they are more active than ever.
"People today who are more than 60 years old are very different from people in that age group as little as 15 years ago," said Marylen Mann, the founder and director of OASIS.
"They are retiring at their prime of life. They are in their prime and are still vital and have a lot to offer," she said.
Mann and officials of May Co., which is funding the program through a $250,000 grant from The May Stores Foundation, stressed that they do not view OASIS as a marketing tool to attract more senior citizens to the stores. "Were that a motivation, it would be a very inefficient way to spend money," said Jerome T. Loeb, May's chief financial officer. "We could do a better job by advertising, and through promotions."
Nonetheless, it is clear that OASIS does increase sales at May Co. stores. As Esther Rosenthal, 66, noted after her exercise class in Hecht's Reisterstown town: "I'll invariably leave a half hour early and shop here. It's a real opportunity to shop."
Lillian Jacobs, 69, added: "When I come here on Friday, I find that I'll shop. It's a good draw for that."
Despite the growing recognition that the elderly represents a lucrative market, many retailers are reluctant to cater to senior citizens.
"Many are painfully hampered in their approach by their unwillingness to pander to anyone other than the very young," noted Kurt Barnard, publisher of Barnard's Retail Marketing Report. "They haven't come to grips with the new reality that someone over 50 isn't someone who necessarily walks on crutches, has a bent back and is getting ready to die. They are reticent about publicly catering to the elderly, fearful the young people will shy away."
Even the elderly may shy away if a retailer caters specifically to them, added Alan Pennington, a retail consultant. For example, he noted Gerber Products Co.'s failure to market its baby food to the elderly, after finding that many senior citizens with digestion problems ate a lot of its baby products. Gerber's test marketed a line of food called "Singles" and promoted it with advertisements featuring the elderly. The test failed because the elderly did not want to be associated with a product geared only to older people, Gerber officials acknowledged. They would much prefer to buy baby food under the guise they are buying it for their grandchildren (often whipping out pictures of babies at the check-out stand) than acknowledge they are eating it themselves, Gerber concluded.
Nonetheless, with the elderly capturing a larger share of the market, more merchants will begin vying for their dollars in the years to come, Barnard and Pennington said.
May's OASIS program began four years ago after an experimental senior-citizen program by Mann showed that the elderly preferred senior-citizen activities at shopping centers over any other urban location, including schools and senior-citizen centers.
"We gave a series of lectures all around the city" of St. Louis, said Mann who is a faculty member at the Washington University School of Medicine. "The programs that drew the largest response were those in May's Famous Barr store. A survey shows that people were bored and lonely and wanted programs. But they didn't want to take part in programs" at senior-citizen centers because of the social stigma, nor did they enjoy programs at local universities because they were intimidating, Mann said.
"The department store was regarded as neutral territory," Mann said. "The people felt they were not going to a place for the elderly, but rather to one of the most alive places in the American scene."
As a result, Mann approached May, which in turn agreed to provide store space. Initial funding was granted through the U.S. Department of Health and Human Services' Administration on Aging. That grant runs out this month, but The May Foundation has agreed to pick up part of the tab and plans to pay up to $250,000 annually. Local social agencies pay for the remaining costs of running the centers.
Today, there are nine OASIS centers in seven different cities. At least four more centers are scheduled to open later this year, including one at Hecht's store in Prince George's Plaza where the elderly population numbers 68,000. Its local sponsor will be the Prince George's County Area Agency on Aging.
Hecht's Reisterstown program, sponsored by the Baltimore Mayor's Commission on Aging, was chosen first in this area because it had an even larger senior-citizen population.
Under the OASIS program, senior citizens pay no money for membership, but are charged minimal fees (ranging from $3 to $15) for the courses, which include weekly exercise, painting, mural and knitting classes as well as lectures that vary from season-to-season and store-to-store. At the Reisterstown store, the current lecture series focuses on stress management and on art and poetry. The fall series emphasized Maryland history and the Chesapeake Bay. Earlier series focused on financial planning and current events.
Usually, each city's OASIS program offers two special discount days a year, where members get a 10 percent cut off regular store prices. The centers have also sponsored fashion shows and make-up demonstrations, using store help.
Overall, OASIS has attracted 21,000 active members, with 1,860 in Reisterstown.
In its first year of operation, Sears has signed up 400,000 members for its Mature Outlook program. In the next two years, it hopes to have 2 million by 1988.
Montgomery Ward's YES, started last October through promotions to Ward's credit-card holders, has just under 50,000 members and hopes to sign up 15,000 by the end of this year.
"We were unknowingly working on these programs simultaneously," said Bachel Pennebaker, president and chief operating officer of Montgomery Ward Enterprises, which operates the YES Club.
YES and Mature Outlook offer virtually identical discounts and information, with the major difference being that YES members get discounts at Wards stores, while Mature Outlook members get discounts at Sears stores and their related subsidiaries, such as Allstate (where lower-interest loans are granted for car purchases), the real-estate division Coldwell Banker (which offers a free home evaluation) and Dean Witter (which will offer a free investment portfolio evaluation).
Discounts are also offered at noncompany institutions for drugs, hotel stays, car rentals and inner-city bus trips.
"It's a perfect opportunity to fulfill a need in the marketplace and give them discounts," Pennebaker said. "At the same time, it increases their trade relationship with Montgomery Ward."
Mature Outlook, added Sears' Strauss "is to exploit this marketplace as tactfully and tastefully as possible."