Is your industry meeting the needs of older adults?

by Jeff Weiss

The world is getting older and there is no stopping it. There are over 110 million adults ages 55+ in Canada and the US representing 30% of the population.  This figure will grow to 36% by 2050 and a staggering 42% by 2100!

Yet, despite this significant shift, older adults are largely ignored or often stereotyped in marketing efforts. In addition, needs change as people get older and few companies are doing a good job at solving for those unmet needs. We call this The Aging Gap which we define as follows:

“The unmet needs that exist between current product and service offerings and the currently ignored functional and emotional needs of older adults.”

Bridging this gap presents a great opportunity for organizations to develop products and services that will drive significant incremental revenue.

Based on recent research we conducted with over 900 working adults across a wide range of industries, we uncovered three key reasons why The Aging Gap exists:

1. Organizations highly overestimate the spending power of younger adults (particularly Gen Z) while underestimating the spending power and longer-term opportunities with older adults.

With close to 68 million individuals comprising the Gen Z cohort, they represent over 20% of the population, making them a large group of consumers worthy of marketers’ attention.  Despite the attention they get, the Gen Z group accounts for less than 3% of consumer spending.

In contrast, Baby Boomers, who are now between 59-77 years old, account for over 30% of consumer spending, approximately 10 times the level of spending by Gen Z while accounting for almost the same portion of the population.

When asked, respondents’ estimates of spending levels by cohort were off significantly:

In addition, and not surprising, the allocation of marketing resources against each group highlights the corporate focus on younger adults despite their relative lack of buying power.

2. The potential for a higher lifetime value with younger consumers is offset by less brand loyalty.

Society’s love affair with youth carries over to the business world as companies feel a greater comfort level in relating to younger consumers with a belief that they are cooler, sexier and more fun. In addition, almost a third of survey respondents believe younger consumers offer a better long-term opportunity.

With 72% of respondents believing that consumers under 35 are worth more, companies may argue that capturing younger customers now will lead to higher lifetime value based on keeping them as customers for a long period of time.  This holds true if these consumers remain brand loyal over time, however, 66% of respondents believe that these individuals are less brand loyal.

This contradiction poses a conundrum to organizations when determining where to invest their resources — do they target younger consumers now who have less income but could potentially become long-term customers or target older adults who have the buying power now and are looking for brands to understand them and better meet their needs?  The answer may lie somewhere in between.

3. Prevalent ageist stereotypes lead to older adults being ignored or portrayed in unrealistic or non-inspirational ways.

Unfortunately ageist stereotypes, that no longer exist for the most part, are still considered reality by many. This makes it difficult for marketers and businesses to effectively portray older adults and to engage and drive action with them.

Stereotypes that exist today (based on survey results) are a big part of the reason why marketers often miss the boat and engaging older consumers, including:

  • 59% believe older adults are less digitally savvy or engaged than younger groups
  • 53% believe they are more brand loyal and less likely to switch brands than younger groups
  • 52% believe they are unwilling to try new things
  • 50% believe they are physically inactive or frail

While these stereotypes will (hopefully) diminish over time, savvy marketers would do well to divert some of their spending now from younger to older adults who are craving their attention. Understanding who they are and how they behave will lead to a much greater ROI for brands willing to see past the myths and stereotypes.

Bridging the Age Gap (Report) Click here to download the entire report and, if you are interesting in learning more about how to better connect with older adults, contact me. We can help you uncover unmet needs that will provide a foundation for industry-leading innovation.

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