The Boomer Market: Business Strategies for Reaching the Over 60 Crowd
We are on the cusp of a revolution. Since January 1, 2006, a baby boomer has turned 60 every seven seconds. This transition will continue for the next 19 years.1 It will bring a revolution in longevity, and its impact will be felt for decades to come.
Millions of people who are now celebrating their 60th birthdays can expect to live longer and more active lives than 60-year-olds could expect a generation ago. What makes this "bonus round" especially compelling is the size of the potential customer base around the globe. There are 77 million baby boomers in the U.S., but the United States was not the only country that saw a sustained increase in fertility during the post-war years. In developed countries, one fifth of the population is currently 60 years old or older. By 2050, that proportion is projected to increase to almost a third.2 In China, by 2025 the 50+ marketplace will be 525.8 million.3
Today, boomers around the world are reinventing their lives. They are finding new places to work, new places to travel to, new ways to spend their days, new fashions, new savings programs, new ways to spend time with their children and grandchildren, and new ways to stay vital and connected as they age. Each new choice represents a signal of enormous business opportunity.
Entrepreneurs, corporate brand managers and strategists, investors, and nonprofit executives want to know how to develop products and services that meet the boomers' changing needs. This book shares insights about boomers that I have gained from spending more than 20 years in the field of aging. I hope that reading it will inspire you to grab a notebook and sketch a business idea to serve this market. If you are an entrepreneur, you may be inspired to think up five or six ideas. If you are a corporate strategist, you will want to consider your company's core competencies and consider how they can be leveraged to create a new suite of products and services to support this marketplace. If you are an investor, you will want to identify ideas, such as healthy living, that can lead to market dominance across a range of categories. If you are a nonprofit executive, you will want to learn how to form programs that inspire boomers to get involved and support your cause.
Boomers' new values and attitudes have transformed consumer behavior at every stage of life so far, and the next stage will be no exception. Currently, 45% of the U.S. population is age 40 or older.4 This group is the best educated, healthiest, and wealthiest generation ever to reach midlife and beyond. It is a force to be recognized and courted over the next decades as boomers move from midlife into old age.
Brad Edmondson was editor-in-chief of American Demographics magazine and is now the co-founder and vice president of ePodunk.com, a website that provides information profiles on more than 50,000 cities and towns in the United States, Canada, and the United Kingdom. He uses Figure 1.1 to help people visualize the business opportunities that will arise as the boomer "pig" continues to move through the life-stage "python."
Figure 1.1 The Hottest Markets (Percent change in U.S. 5-year age groups, 2005-2015)
Source: U.S. Bureau of the Census
"Older boomers are the focus of market opportunity in the next decade," says Brad. "The smart business is going to define a specific consumer target and aim for it with the best marketing information available. The key concepts for reaching boomers around the globe are preservation and quality of life. The most important market segments among boomers are empty-nest couples and older singles."5
The key to success in this marketplace is life-stage marketing because the boomers will go through more transitions in their 50s and 60s than any other phase of life.6 Each life-stage transition triggers business opportunities that revolve around family (empty nests, loss of parents, arrival of grandchildren); health issues (menopause, heart disease, vision and hearing loss, arthritis); housing (downsizing, rightsizing, remodeling, second homes); finances, work, retirement, and daily activities (time for passions and play); and perspective (the search for meaning).
The boomers are not a homogenous group. Many people who are in their 50s today face retirement, empty nests, grandparenting, and aging parents, but some of them have young children, and some are newlyweds. Today, millions of younger boomers (born from 1956 to 1964) are still pursuing careers and helping their kids through school. The boomers are also ethnically and economically diverse. For example, in the United States, 12% of older boomers (those born between 1946 and 1955) and 15% of younger boomers are foreign-born.7
The emergence of a large, healthy, well-educated cohort of consumers in their 60s is a social and a business revolution the world has never seen before. Adults age 45 and older account for 77% of financial assets in the United States, control 70% of total wealth, and account for more than half of the nation's discretionary spending.8
The need for relevant products geared toward this aging population is growing daily because the demographic pressures are global. According to the Australian Bureau of Statistics, "The 'coming of age' of our baby boomers will challenge and perhaps totally revolutionize the stereotyped views people have about the habits, behavior, and tastes of people in their middle to senior years."9
The key to success in reaching baby boomers is tying your business idea to the social issues that surround aging, such as loneliness, empty nests, dating after 50, the death of a loved one, and retirement. Turning Silver into Gold explores these issues in terms of the emerging needs and desires of the boomer psyche. The most powerful insight we present is that for boomers today, amassing material possessions is not as important as having experiences that satisfy the mind, body, and spirit.
As you consider launching a new business for boomers, it is important to know that there are few barriers to entry for a new brand aimed at this generation. Surveys report that boomers are not brand loyal. They are educated consumers, and if they can find a smarter solution, they will switch brands. When you identify products that will serve their needs, there is a great potential for gaining market share. Some of the boomers' needs will be related to the challenges of aging. That is why we are seeing more performance-enhancing drugs related to sexuality and more spas and respite services to help people cope with the stresses around loss. Yet many of the opportunities will be centered on the joys of this lifestage transition. Boomers will have more time for travel and education and experiences shared with friends and family.
This book focuses on five key concepts and trends that will help increase your understanding of boomers and help you build a winning business strategy to reach this growing market. These areas—global markets, longevity, technology life-stage transitions, and spirituality/giving back—are woven throughout each chapter to bring perspective and to spark creative imagination.
According to CEO Linda Jenkinson of LesConcierges, Inc., it takes 10 languages to do business in the world today. Corporations, entrepreneurs, and non-profits routinely procure their boxes in Ghana, fabric in New Zealand, call centers in India, and programmers in Eastern Europe. Markets and teams are global. IBM has a global eldercare strategy. Intel holds its health care portfolio meeting in China. Fashion entrepreneurs launch their lines in Dubai and Macau. Microsoft's second largest company headquarters is in India. Roger Barnett, the CEO of Shaklee Corporation, travels to Asia and Europe and throughout North America serving a global market need for vitamins and natural products. The Internet makes it possible for companies to sell their products and services globally. The Internet also makes it possible to find a global team, and to respond to issues globally.