The fact that Japan has the most rapidly aging society in the world is hardly news anymore. More than one in four Japanese were 65 or over according to 2015 census figures and population planners predict the figure could rise to 40 percent by around 2065. Based on this scenario, it doesn’t take an economics degree to understand the potential business opportunities out there.
“The total annual consumption total sum of the elderly (60 years and older) already exceeds 100 trillion yen, and this amount is now increasing by one trillion yen every year,” says Toru Saito, consulting director of Dentsu’s Innovation Design Department. “Research indicates that these consumers have the greatest financial assets in Japan, and many companies are looking at various approaches for this market.”
Despite this, however, advertisers still seem uncertain of how to harness this potential and stay abreast of developments in such a lucrative market.
One issue is that the market tends to be a seen as a monolithic group comprising of anyone past retirement age, generally 60 or 65. In a comprehensive report for investment and brokerage group CLSA, Oliver Matthew and David McCaughan mention the “grandma effect”, and how many people’s mental image of a 70-year-old woman is likely to be a devoted matriarch cooking in the kitchen. This is far from the reality of the demographic in their mid-60s through to mid-70s, who the co-authors refer to as “active balancers” in their report.
While embracing the changes that come with age, such people are seeking to focus on maintaining the activities that bring them pleasure. Their needs and priorities are distinct from those in their 80s, when failing health, declining cognitive abilities and the loss of a spouse start to become a reality for many. According to Matthew, who is head of consumer for CLSA, recognising the diverse needs that exist should be a priority. “The senior market can be well segmented like any other, both in terms of identifying different sub-demographics and different advertising channels. In an aging society, obviously a very large portion of spending power is with the older demographics. Having strong segmentation there is key to success.”
Another conundrum for the business world is bridging the gap between the way they view seniors and how the seniors see themselves. In a report released earlier this year, a group of academic societies suggested that current terminology be revamped so that “elderly” refers to those 75 or old, reflecting the fact that many people in the 65 to 74 age bracket are still active professionally and socially. They also coined a new term, “super-elderly”, to describe the growing numbers of seniors 90 and older.
The Japanese media has yet to hit on a user-friendly term that can describe this active generation at the younger end of the senior cohort. According to his firm’s research, Mitsusuke Inaba an executive in ADK’s Solution Planning Department, notes that “senior” is the least offensive term. “However, it is more like the best of a bad bunch, in that these vital older people don’t particularly like even the term ‘senior’ very much,” he says.
Inaba points out one example of an active senior seeking to write his own narrative in veteran editor Ichiro Kishida, who launched new men’s magazine “GG” this June. Published by GG Media, the magazine is aimed primarily at men in their 50s, 60s and 70s, or the “Golden Generation” seeking to live their life to the fullest, says the 60-something Kishida. The name can also be viewed as cocking a snook at society’s labels, as the Japanese term ‘jiji’’ can be either an affectionate diminutive for “grandpa” or a rude term for “old man”, depending on the context.
Dentsu’s Saito points out that there are certain characteristics of the senior market that advertisers would do well to bear in mind. “Seniors tend not to switch brands that easily, so it can be said that firms taking a long-term approach will be more successful. Conversely, companies looking for quick results are more likely to fail with this market. Compared to the youth market, senior consumers are less likely to respond to fads and trends, and thus it is difficult if you expect results in the short-term.”
Leonard Le, senior strategic planner at Tokyo-based creative agency UltraSuperNew, says that companies must not just rely on data and should engage in direct conversation with their targets. “A high volume of quantitative and qualitative data is good to have to help identify patterns, establish a foundation to work from, etc. However, brands and marketing firms need to do more to look from the point of view of customers when developing their marketing strategies and tactics. Are they solving a problem the consumers actually have or are they trying to shoehorn their product/service to fit their preferred consumer audience profile?” he asks.
Adults, not seniors
Shiseido tapped into this approach in 2015 when they launched Prior, a new skincare and cosmetics range aimed women over 50. But it’s surprising that more brands have not followed in its footsteps. Women in this cohort already account for nearly 48 percent of market share, and this is projected to grow as Japan’s population matures rapidly.
“We held hands-on events for women in the target age range in seven cities across Japan,” notes Satoshi Hirota of the corporate communications department. Shiseido’s hair and make up artists worked with participants and provided consultation on skin, hair and fashion tailored for those moving into middle age and beyond. “This is a influential market and we anticipate great future growth pontential in the long-term.”
Shiseido employed the talents of two well-known Japanese actresses in advertising for the Prior range. The spots feature Mieko Harada and Nobuko Miyamoto, in their late 50s and early 70s respectively, in a variety of situations, including hiking in the mountains. The copy builds on the image of an active lifestyle by promoting it as skincare for “adults” rather than “seniors”.
According to ADK’s Inaba, making advertising relatable without implying they are “old” is definitely a plus when considering how to approach the senior market. “Today’s seniors don’t want to be portrayed huddled around a table sipping cups of tea. Retro, cool and hip are themes that advertisers can use. For example, bringing in the idols, sports stars or anime characters that were popular with these generations growing up can be a great touch point in advertising.”
Le of UltraSuperNew says that another common conception about those over 60 is that they are IT-illiterate. “That, at best, is a blanket assumption and not necessarily consistent across all elderly consumers,” he points out. “On top of that, we need to remember that those who are in their 40's and 50's today will shortly be nearing the age at which brands/marketers start to consider them the ‘elderly market’. But these people use the Internet, SNS, smartphones, etc. at work and in their daily lives. The way brands and marketers think about who the ‘elderly’ are will need to keep evolving.”
Published first on Campaign Japan: 「シニア層」へのアプローチに再考が求められる理由