Aging Population as a Business Opportunity
In the world, two billion people will be 60 years’ old, or older, by 2050, more than triple the number in 2000, according to the World Health Organization. This will be a huge challenge in Western countries, but also a new business opportunity for AEC companies. Here are some ideas for how to start exploiting the growing market.
Bust the myths
Until recently marketers and advertising agencies overlooked the 50-plus market, which has a buying power of $1.6 trillion in the U.S. alone. At the beginning of this century, less than ten percent of advertising focused on people over 50. This was partly due to a poor understanding of the business value and needs of older customers.
I found the following list of frequently heard, but not always true, myths in “Ageism in American Advertising: A Matter of Awareness” :
- Myth #1: You get old; you get sick
- Myth #2: You get old; you lose interest in intimacy
- Myth #3: You get old; you are unwilling to try anything new
- Myth #4: You get old; you lose control of bodily functions
- Myth #5: You get old; you can’t function in the work place
- Myth #6: You get old; you can’t understand technology
- Myth #7: You get old; you have no social life
- Myth #8: You get old; you cannot fully participate or pull you own weight
- Myth #9: You get old; you need help to make decisions
Myths aside, you must be able to understand what works in communication and advertising for older generations. According to David B. Wolfe, author of the book Serving the Ageless Market, people become more introspective, individuated and autonomous at midlife.
Older consumers think in a more nuanced manner, and see more shades of gray where young consumers perceive the world in black and white. Individuation leads to reduced customer loyalty because the mature consumer does not want to be treated “according to a script.” Autonomous thinkers don’t value argument-based advertising that hard sells product features, functional benefits or economic value.
Failure is imminent when marketers let their own beliefs and values guide marketing and communication. The Mature Market Group and Seniors Resource Group conducted a study of adults 62-plus to determine if a person’s life events, situations and generational experiences shape their core values. Instead of finding the typical “old people profile” they determined that they can be categorized into eight distinct segments, which help predict their marketplace behavior.
Create new products and services
Even if the world of products is becoming “ageless” there are opportunities for creating products and services for mature consumers. Here are some examples:
- Non-standard solutions – Senior citizens can have very special spatial and other needs. Many of them also have the means to pay for customized solutions. What would you offer a person who wants a city apartment with space to store and maintain her motorcycle?
- Working spaces – Many people keep on working after the official retirement age. What special needs could you serve at their home or workplace?
- Senior-friendly environments – Most existing buildings were not designed with special needs in mind. You could offer retrofitting services and products that make a senior’s life easier.
- Safety enhancements – Make living alone a viable option by making homes secure, safe and controllable.
- Luxury – Help your customers fulfill their dreams with special high-end services and products.
- Physical health – Exercise is important at any age. Provide environments and equipment for physical training and games.
- Moving around – Create innovative transport solutions for old buildings with crammed stairways and non-existent lifts.
- Interfaces – Electronic devices are becoming smaller and smaller. Think about ways to make different building and home systems easier to operate for someone with reduced eyesight and strength. Ease of use is a good idea, no matter the age!
- The net – Grandmothers sell on e-bay and socialize on Facebook. What great services could you offer to wealthy net-savvy grandparents?
- Expertise – It makes sense for architects and engineers to acquire knowledge on how to satisfy the needs of senior customers. That knowledge will become more valuable with time. After all, investors and builders cannot ignore this trend if they want to prosper.
Adjust your offering
It is not always necessary to completely revamp your products or services for mature consumers. Some years ago our company was involved in a software development project, which created an online application to evaluate barrier-free environments. The researchers who built the database ensured that in most cases barrier-free environments are actually good for everybody, regardless of age. An entrance that allows easy access with a walker is also great for a young parent with a baby buggy.
A great example of unprejudiced thinking is Lappset, a leading manufacturer of playground equipment. They are known for Angry Birds activity parks and parkour solutions, to mention a few. Recently they added Senior Sport products to their collection. Quoting from their website: “The mission of Lappset is to get people to go outside to play and exercise. Actually, although the Senior Sport equipment range is designed for the elderly, it is equally suited for children to play on. A Senior Sport installation can thus become a meeting place for three generation, with outdoor fitness activities for everyone from toddlers to old-timers.”