MOVE OVER SONNY

OUT WITH THE NEW IN WITH THE OLD

After the family-raising years of a person’s lifestage, consumer demand begins declining.

Just after 2010, the size of older people both in terms of the numbers and percentages (especially the oldest old) will begin to increase quickly in most developed and many developing countries.

Emerging as a major demographic worldwide trend as we move through the first ten years of

the twenty-first century, population aging is evident across nations.

Although the world’s population is aging, children still outnumber older people as of 2008. Projections indicate, however, that in fewer than 10 years, older people will outnumber children for the first time in history.

By the middle of 2008 there were an estimated 506 million people worldwide 65 years of age and older representing about 7 percent of the world population.

That number is projected to grow to 729 million by 2020. And by 2040 that number will grow to 1.3 billion or about 14 percent of the world population, double the current figure.

The average age of the world’s population is increasing at an unprecedented rate.

The estimated change in the total size of the world’s older population between July 2007 and July 2008 was more than 10.4 million people, an average of 870,000 each month.

AROUND THE WORLD TODAY

The industrialized nations of Europe, North America, Japan, and Australia have higher percentages of older people than do most developing countries.

However 62 percent of all people aged 65 and over now live in the developing countries of Africa, Asia, Latin America, the Caribbean, and Oceania.

The Caribbean, with 7.8 percent of all people aged 65 and over in 2008 is the developing region with the highest percentage of older people; Latin America, 6.4 percent; Asia (excluding Japan), 6.2 percent; and Africa, 3.3 percent.

Industrialised nations experienced aging over the last 100 years during which time they went through the process of industrialization and the demographic transition.

Countries in Asia, South and Latin America, and more recently Africa began their demographic transitions much later but like their demographic transitions, much more rapidly.

Industrialised nations took generations to go from high to low fertility.

China, went from high to low fertility in less than one generation.

Rapid decline in fertility contributes to rapid aging some years later. Asia is the fastest aging continent because fertility is now declining most rapidly here. The most rapidly aging continent in the future will probably be Africa.

China which has both the world’s largest total population (more than 1.3 billion) and the largest older population, numbering 106 million in 2008. In the next ten years China will have the most rapidly aging population in the world.

The highest percentage of older people in 2008 can be found in Japan. With 22 percent of its population aged 65 or over, Japan recently supplanted Italy as the world’s oldest major country.

In Singapore the number of people 65 years and over, representing 8 percent of the population, has already been outnumbering people under the age of 5 for some time. By 2020 that figure is projected to climb to almost 15 percent.

Today, the number of people 60 years and over is already close to the number of under 5 year olds in Indonesia, and by 2015 will have exceeded them.

Malaysia’s over 65 year olds currently makes up about 7 percent of our population but that figure is projected to grow to 11 percent in 2020 at which time the number of people 60 years and over will outnumber the size of the under 5 year old age group.

By 2020, Thailand will have more elderly people than newborn babies, with 11 million of the total population expected to be over the age of 60, though in terms of economics, according to the Thailand Development Research Institute, the nation will become an ageing country from next year.

India’s population about trippled over the last 50 years but its elderly quadrupled. The United Nations thinks the same thing will happen over the next 50 years.

The United States will age rapidly when the Baby Boomers (people born between 1946 and 1964) begin to reach age 65 after the year 2010. The percentage of the US population of 65 and over in the year 2050 is projected to be 20 percent (compared with 12 percent today).

The number of the world’s “oldest old” (people 80 and over) is growing more rapidly than the older (65 and over) population as a whole.

The oldest old are the fastest-growing component of many national populations.

The world’s growth rate for the 80-and-over population from 2007 to 2008 was 4.3 percent, while that of the world’s older (65 and over) population as a whole was 2.1 percent (compared with 1.2 percent for the total [all ages] population).

MARKETS WILL BE AFFECTED

Markets are made up of people and people make up population compositions. Changes in one will invariably affect the other.

With younger age groups flat to shrinking marketers need to rethink where their growth will come from.

Organisations in just about every sector will be affected.

FMCG, IT, Electronics, Dining & Entertainment, Retail, Financial Products & Services, Automotive, Apparel and Fashion Accessories, Health & Wellness, Real Estate, Travel & Tourism, and the Hotel & Lodging businesses to name a few.

Companies and their product and service brands must become more adept at identifying and meeting the needs of a consumer that is age 50+ or older with shifting biological, psychological, social, and economic characteristics, needs, and expectations.

SONIC BOOM

Recent developments in technology sectors like the internet and information technology products including mobile telephony and hand held computers, entertainment particularly electronic games and so on and the effects they have had on other sectors, has resulted in special attention given to 18 – 25 year olds, the “hot market”.

But the older generation of today was the younger generation yesterday.

Generally defined as those born between the years 1946 and 1964, “Baby Boomers” have been driving market development for everything from houses to cars to entertainment to almost all consumer products for several decades.

Recently the very first of these “Baby Boomers” turned 60.

PRODUCT & PHYSICAL PACKAGING

Obviously there is no “one-size-fits-all” solution for the myriad situations that will differ in varying degrees across sectors and geographies. There are, however, some places where we can start looking for them.

Some characteristics that typify a “boomer” are his requirement for convenience, ergonomics and visibility, among other demands although personal and cultural values will differ from individual to indivvidual.

FOUNTAIN OF YOUTH

The growth in anti-aging products has been driven by the desire of a generation to remain young. Even the oldest “Boomers” continue to be active and vital.

The aging populations of today, excepting perhaps Africa’s, could well live 20 years and more past the typical retirement age of 65, reinforcing the relevance of all kinds of health and wellness products particularly those offering a way to beat the clock.

PROTECTING GOLDEN ASSETS

Safety becomes more important as advanced age places users at additional risk due to normal physical and sensory deficits associated with aging.

Conditions frequently associated with age (i.e., arthritis, limited vision and hearing, and depression) potentially make the demands of daily work and home life more dangerous.

Risks that increase an older person’s susceptibility to injury include sensory loss like declining eyesight, loss in muscle and skeletal strength, slower reaction time, more rapid fatigue, reduced ability to handle tasks under time stress, automatic rather than attentive behavior from repeated performance of a task or action and weight issues.

THE SPIRIT IS WILLING, BUT…

If you have ever wrestled with tough plastic packaging, or struggled to unscrew a lid, pull a ring pull can, or twist open a safety cap or squeeze the contents out of a squeezable container, just think for a moment of how it will affect you when you are older.

Recently visiting biomechanics expert Dr Alaster Yoxall, from the Human Centred Engineering, Art & Design Research Centre at Sheffield Hallam University in the UK addressed the pressing issue of “openability” at the 42nd annual Australian Institute of Food Science & Technology convention in Brisbane.

Dr Yoxall, who with his team is currently researching and developing different types of future packaging to help overcome difficulties, says that these will include styles that can be opened using the palms of the hand and in future may also include ones openable by elbows or shoulders too.

The importance of improved accessibility is driven by deteriorating physical conditions and the continuing desire for greater convenience. Not only must a product be easy to open, it needs to be easy to use.

Visibility of product and product information and usage instructions has become more important. The challenge will be in designing products that can be easily, seen and read by older people while remaining appealing to younger people.

MARKETING ACROSS GENERATIONS

In “The 7 Biggest Marketing Challenges Of This Decade” Gerard F. McDonough and Susan Cohen talk about the necessary difficulty marketers will face in shifting from a focus or emphasis on younger markets to a targeting strategy that includes the older age groups.

While age segmentation has been a marketing cornerstone for about 50 years, owing to the continuing shrinkage of the 24 – 44 year old group, traditionally the biggest-spending 20-year age grouping, it is from much older age groups that marketers must look to, for their income and growth.

For mass market brands, this means shifting the focus of marketing activities to older target market groups without alienating younger customers or prospects.

This will require what has now become known as ageless marketing which is based on projecting values that, rather than being exclusive to a particular group or generation, strick a chord across generations.

For a better handle on how to get this done I suggest reading “Serving the Ageless Market” written 20 years ago by David Wolfe and his current book, “Ageless Marketing : Strategies for Reaching the Hearts and Minds of the New Customer Majority.”

INFORMATION AND INSIGHT GAP

Older people have been largely ignored by a great many companies and the brands and products and services they own and market.

In a nutshell this is because most companies do not really know or understand the issues, challenges and needs of older people.

One way that companies can address this oversight is to include older people in their product development programs, approaching them and facilitating their participation in panels and forums.

Employing consumer panels is not new in product development research but for the most part younger people have usually been employed in those panels.

With their greater knowledge and experience making use of older people in consumer panles and other similar groups could lead to developments that are better for all and not just for the elderly.

Apart from specific product development and evaluative consumer groups engaging older members of the population can also include social networking sites and blogs.

Barbara Walters’ former television producer, Ronni Bennett, has a blog “As Time Goes By” and its affiliated blog “The Elder Storytelling Place” which is a goldmine of insights lodged in the stories that people tell each other about themselves.

For those to whom all of this just feels too daunting, I suggest you get in touch with Kim Walker who was in Kuala Lumpur and talked to BFM recently about the aging consumer in Asia Pacific. Kim Walker is the founder of Silver Group Asia, a consultancy that specialises in this group and marketing to them.

A NEW BEGINNING

An aging world is not the end of it all. It’s just a different world. Governments who have not already done these things will have to struggle with what to do to maintain productivity with their currently defined workforce, shrinking, what to do about the health and care of senior citizens and so on. And marketers too need to graple with the changed dynamics and bring about products, communication and other consumer promotional activity that will be relevant to a broader audience.