Asia is ageing. By 2050, one in four people in China will be aged over 65. Japan is already the oldest society on earth with a quarter of the population over 65, set to rise to 40 percent by 2060. The Japanese are ageing in such numbers, in fact, that the government has categorised those aged 65 and above as “pre-old”, 75-plus as “old”, and the over-85s as “very old”.
Hong Kong, South Korea and Thailand also have a rapidly shrinking share of working-age population, and the UN predicts that in the next 30 years, the number of people aged over 60 in Asia will increase dramatically from 11 percent of the total population to over a quarter.
While this demographic trend is often a point of challenge for politicians and concern for economists, to marketers they simply represent a missed opportunity. In an industry that idolises youth, a number of marketers are starting to wake up to the powerful spending potential of the
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“There is no doubt that this is the largest, fastest-growing, wealthiest segment of population in most developed markets of the world,” says Kim Walker, CEO of marketing consultancy Silver Group. “And in Asia-Pacific, 54 percent of high-net-worth individuals are over 56 years of age, according to Cap Gemini and Merrill Lynch.”
Research group Nielsen says ‘baby boomers’ in the US spend close to half of all FMCG dollars, yet less than 5 percent of advertising is geared towards them. This mismatch is set to create problems for the future of marketing as the portion of the market in the 60-plus age group swells. But to target Asia’s older consumers, brands first need to shatter preconceived stereotypes that may turn the consumer off.
“There are three misconceptions about senior consumers,” says Matthew Crabbe, director of research, Asia-Pacific, at Mintel. “Firstly, there is the assumption that they tend to live life the old-fashioned way, and thus think less about improvement; secondly, that they would pay more for premium or advanced product features just because they can afford to; and thirdly, brands not recognising the diversity of the senior consumers in terms of their values and pursuits.”
Mintel’s research concluded that Asia’s older consumers are just as dynamic as younger generations, and that while achieving good health is the most important goal for the majority of seniors, after that they want to spend on experiences and active lifestyles.
In China, Mintel’s research found that after spending on health, almost half of consumers aged 55 to 74 said they wanted to spend money on being entertained and on social events. They also wanted to spend more time travelling than shopping. However, Mintel found the majority of brands currently targeting China’s 55-plus age group fell into categories such as dairy products (particularly milk formula), cereals, or hot beverages.
More than maladies
While a succession of surveys have shown active, older consumers looking forward to a new stage of life, many brands still focus only on the ‘solutions’ to being older.
“The one thing we see happening most often is the temptation to market to their maladies,” says Tim Love, former CEO of Omnicom Group Asia-Pacific, and now chairman of the board of advisors at marketing consultancy BoomAgers. “What marketing has typically done is present a problem, then the solution. So advertisers have too often been asking if ageing people have issues with dentures, need help getting up the stairs, or have chronic pain. But on the other hand, people of age are saying to us that these are the best years of their lives. So just as these people are saying they feel great, marketers come along and tell them they are falling apart and need this product to fix it.
“Adverts like that are a total downer for older people who were previously feeling good.”
As well as positivity, consumers aged over 60 also crave authenticity. “Older consumers are the most experienced consumers,” says Walker. “After all, they’ve been sold to for longer. As a result, they tend to see beyond the ‘cheap tricks’ of marketing and look for genuine value in brands.
“While research tells us that most older people are comfortable or even happy with their age, they don’t want brands to remind them of their age or to talk to them as ‘older people’.”
One of the brands doing well in engaging with older consumers is global cosmetics giant L’Oréal, with its use of authentic and popular older models, such as Helen Mirren, and age-friendly taglines like: ‘We’ve still got it, and we’re still worth it’.
But in Asia, brands have been slower to recognise this part of the market. One successful brand launch was the contemporary-looking Sixties’ Bamboo Charcoal Toothpaste, which was reformulated and designed for senior consumers in China, marketing specific benefits for the older age group. Reebok also made headlines in March when it appointed 80-year-old actor Wang Deshun as its brand ambassador in China. Wang also stars in Reebok’s latest Chinese video campaign ‘Be more human’. According to the sports giant, Wang only got into sport in his 60s and is an example to prove that people are never too old to pursue their goals.
“Examples of brands engaging with older consumers are rare,” says Crabbe. “Mostly they focus on helping adult children of elderly consumers with care. Yet, all the time, more older people are working into later life, staying active and alert, as well as spending what they earn on enjoying themselves.”
Other common misconceptions include the assumption that 60-plus consumers are always brand loyal, and are less likely to use technology. Crabbe says that in China, 55 percent of those surveyed said they actually found shopping online easier than shopping in-store.
“The reality is that older consumers are switching brands very actively because the dynamic of switching makes them feel connected and alive,” says Peter Hubbell, CEO of BoomAgers. “They see currency in embracing what’s new. They are embracing social media because it is offering them connectivity at a life stage when connectivity is one of their top concerns about ageing.”
According to Walker, while the 2016 Google Consumer Barometer found most older people in China still preferred to use a PC if they buy online, and just 51 percent of the 55-plus segment in China used smartphones, 86 percent of Chinese consumers aged 45 to 54 do indeed use smartphones, suggesting marketers need to adjust very quickly toward the Chinese ageing spender.
Meanwhile, in Japan a BCG study in September found older generations were the most committed online shoppers for luxury goods and services.
However, many brands are focusing on more youthful consumers, and being distracted from their existing customer potential. “One major distraction that is preventing people targeting age at the moment is the millennials,” says Hubbell. “There are going to be 2 billion of them worldwide: they are young, they are socially connected, they are digitally connected — they are everything marketers dream of. But as I say quite often, millennials represent the future of marketing, but the future isn’t here yet.”
Marketers in this field argue that becoming ‘ageless’ and adopting a more age-inclusive approach is one of the best future-proofing strategies for brands. The retailer TK Maxx in the UK, for example, has since 2014 been using older models, including 62-year-old Olga Taylor, in advertising as standard, alongside younger models.
“There is no need to choose between millennials and [baby] boomers,” Walker says. “These generational differences have been hyped to generate intrigue and to feed the management and research consultancies. Choosing between younger and older consumers is not a zero-sum game. Brands should continue to seek new, younger consumers. However, they must do more to retain and attract their arguably more lucrative older customers at the same time.”
As Hubbell sums up: “The whole notion is bringing positivity. If you listen to people of age, they are telling you that they feel great, optimistic about their future, and they want marketers to be positive too.”