2014年10月20日 星期一

The silver economy: Healthier and wealthier



October 19, 2014 7:16 pm

The silver economy: Healthier and wealthier

By 2050 those aged over 65 will outnumber children under five. The first part of a series on ageing populations looks at how that demographic shift is creating a new and powerful consumer class
Robert Harker, 73, and his wife Nancy, 70, square dance in Sun City, Arizona, January 8, 2013. Sun City was built in 1959 by entrepreneur Del Webb as Americaís first active retirement community for the over-55's. Del Webb predicted that retirees would flock to a community where they were given more than just a house with a rocking chair in which to sit and wait to die. Todayís residents keep their minds and bodies active by socializing at over 120 clubs with activities such as square dancing, ceramics, roller skating, computers, cheerleading, racquetball and yoga. There are 38,500 residents in the community with an average age 72.4 years. Picture taken January 8, 2013. REUTERS/Lucy Nicholson (UNITED STATES - Tags: SOCIETY)

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hen Del Webb built its first retirement community in Sun City, Arizona, in 1960, the typical occupants were a retired husband and his wife who had never worked outside the home. The development promised an “active new way of life”, with a golf course, a weekly “chow night” at the recreation centre and the occasional minstrel show put on by residents.
“We would never build one like that now,” says Jacque Petroulakis of Del Webb. New developments hold fewer than 1,000 units and most have space for classrooms. Many have a motorbike clubhouse, and more than a quarter of buyers are single. “The whole idea of retirement is seen in a different light today,” says Ms Petroulakis.
The concept of retirement – and old age itself – is being reshaped by a record number of baby boomers who are, or are approaching, 65. The effects of this demographic shift are being felt well beyond Sun City.

A recent Bank of America Merrill Lynch report cites UN estimates that the number of people worldwide aged 60 years and older will double to more than 2bn by mid-century. By 2050, the number of those aged over 65 will outnumber children aged five and under for the first time in human history.

That scenario has huge implications for government, and business, not least where to find future generations of taxpaying workers.

Sarah Harper, director of the Oxford Institute of Population Ageing, says “the vast majority of people in the world will make it to age 70”, once considered extraordinary old age. The shape of the classic “population pyramid” showing large numbers of young people at the bottom with a few elderly on top has changed.

Fertility rates in developed countries, and in many emerging economies such as South Korea, have fallen so far that they face a shortage of younger workers and consumers. It means the number of those who once could be counted on to buy homes, cars, motorbikes, clothing and other consumer goods is also likely to shrink in the future.
“We’ve gone from a pyramid to a skyscraper,” Professor Harper says. “It will change the 21st century in a way we never could have imagined.”

The rise in longevity has upended policy on pensions and healthcare, with governments raising retirement ages and shifting responsibility for saving and investing on to individuals.
But there is another side of the coin to the ageing population: it offers many industries an opportunity to target a whole new market.

Look at those middle-aged men in Lycra. They are riding bicycles that only a professional can afford. The way we think about ageing is changing
- Sanjeev Sanyal, Deutsche Bank
These new consumers are members of the fast-growing older demographic who are healthier and wealthier not only when compared with earlier generations of the same age. Crucially their spending power will be greater than that of the more frequently targeted 18 to 39-year olds.
BofAMerrill Lynch, which recently produced a report on what it calls The Silver Dollar, cites estimates that the over-50s account for almost 60 per cent of total US consumer spending and 50 per cent of that in the UK.
Jody Holtzman, of the American Association of Retired Persons, whose members are aged 50 plus, says that for many people longer lives will mean an extended middle age rather than a descent into frailty.
“It is only in Washington that addressing the needs of 100m people is called an unaffordable burden,” Mr Holtzman says. “In the private sector, it’s called ‘an opportunity’.”
And industries are adapting. Sanjeev Sanyal, global strategist at Deutsche Bank, says the market for high-priced consumer goods – cars, watches, sports equipment – is dominated by older adults.
“Look at those middle-aged men in Lycra,” says Mr Sanyal. “They are riding bicycles that only a professional can afford. The way we think about ageing is changing.
“Within a generation we will have to get rid of this idea of retiring. A 70-year-old should be somebody who goes to the office every day.”
The way goods and services are marketed to older adults with deeper pockets is also changing. “Demographic drivers, including increasing life expectancy, raised retirement ages, longer working lives as well as inheritance, will further boost the incomes and spending power of older consumers,” according to the BofA report.

Companies are preparing for the new wave of older consumers. Property developers, carmakers, technology companies, financial services firms and the pharmaceutical industry are all tailoring their offerings accordingly.

“We have a saying about things that were traditionally designed for older people,” says Stephen Johnston, co-founder of Ageing 2.0, a technology design network whose members develop niche products to improve quality of life for those with infirmities. “We call them Big, Beige and Boring.” Increasingly, he says, marketers are moving away from that format. “The biggest trend we see is a move towards .ageless design

With good reason. Today, the wealthiest fifth of those aged 50 to 64 spend more each week on food and alcohol, recreation, restaurants, hotels and transport than those of the more-coveted 30 to 49-year-old age group. And Britain is no exception.

Within a generation we will have to get rid of this idea of retiring. A 70-year-old should be somebody who goes to the office every day
In wealthy countries, the effects of this spending power can already be seen. For example, the percentage of new cars bought by Americans aged over 65 is about a fifth of the total so far in 2014, up from 11 per cent in 2004, before the recession hit, according to IHS Automotive. The share bought by the core 18-to-34-year-old age group fell from 17 per cent to 11 per cent in the same period.
That is forcing manufacturers to design cars that are easier for older drivers to sit in and manoeuvre. Sven Hartelt, an IHS Automotive analyst, says manufacturers are adding features to help older drivers whose attention spans and reflexes are slowing.
But because people are entering retirement in good health – and with far greater wealth than earlier generations – they are spending time and money in different ways to their parents.
Stephen Bond, co-director of the Demographic Users’ Group of large UK retailers, is a former executive at Marks and Spencer. He says older adults are no longer willing to adopt traditional “old people’s” attire and are keen to dress fashionably.
He recalls a market research exercise with a panel of older, female shoppers, one of whom attended the first Glastonbury rock festival. “She was waxing eloquent about it,” Mr Bond says. “In her mind, she is still that same person. When you see yourself through your own eyes, you see the same person you always did.”

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