While businesses have been busy marketing their products and services to millennials, a new report from Environics Analytics says that they are missing out on a huge, mostly untapped market: the baby boomers.
Boomers outnumber any other generation in Canada. The number of Canadians over age 55 increased by 87 per cent between 1996 and 2006, according to an Environics report. In the next ten years, there will be another 16 per cent surge in the number of people aged 55 and over. In comparison, Canadians aged between 16 and 54 only rose 14 per cent between 1996 and 2016.
Canadian households aged 65 and over had an average net worth of $845,600 in 2016. That’s an 86 per cent increase since 1999 after adjusting for inflation.
“They’re active, healthy, they have money to spend, they’re interested, and they’re curious,” said Dr Doug Norris, senior vice-president and chief demographer at Environics Analytics.“I don’t think many businesses have tapped into exactly how different they are.”
Not only do boomers have the physical numbers and have high life expectancy, they also have the spending power.
With all this extra money, good health, and spare time, why aren’t more companies trying to draw the boomers in?
Sylvain Charlebois, a business professor at the Rowe School of Business at Dalhousie University thinks it’s because boomers tend to follow the status quo and millennials are largely challenging it, especially when it comes to food.
“It’s not really about brands anymore, it’s about the product and what it represents,” said the Guelph-based Charlebois. “Boomers really got into the branding and really enjoyed them. They made a lot of multinationals very successful. Millennials consume very differently, they don’t care about the brand, and they care about what the product represents.”
While boomers continue to go to Walmart and Costco, millennials want Whole Foods and the convenience of ready-to-cook meals such as Hello Fresh, said Charlebois.
Norris believes boomers are being underestimated and not properly differentiated from the pre-war generations that were more resistant to innovation and technology.
Other opportunities within the boomers market includes real estate, as many boomers may be selling their homes in exchange for condos or renovating their current homes for accessibility purposes.
There’s also the cannabis industry. Of the 200,000 Canadians with a medical cannabis licence,two-thirdsuse the substance to treat arthritis. Asurveyby CAMH Monitor also found there has been a notable rise in cannabis use among those aged 50 and older.
Environics’ Norris also notes that boomers are more educated than generations before them with half of Canadians 55 and over having some form of post-secondary education and are more interested in innovation.
Two industries Norris thinks have been successful in identifying boomers as a viable market are the health and travel industry.
“Certainly industries that have been working hard are the travel industry, you think of what’s happening with cruises today, you just can’t build those ships fast enough,” Norris said.
A study conducted for Expedia Media Solutions by Northstar Research Partners found that out of all generations in Canada, baby boomers travel the most on average with approximately 28 days of travelling per year, with a strong preference for international trips.
Cosmetics and beauty are also successfully tapping into the senior market by showcasing older women as spokespeople, Norris said.Some examples include actresses Helen Mirren and Diane Keaton.
The report poses the need for accessibility and making shopping and products more senior-friendly as the boomers and older seniors continue to age.
Charlebois says grocery stores in rural Canada, where the population of seniors is higher, are making more noticeable changes such as seating options within the store for customers to take a rest.
Some brands such as Gillette have already created products serving the rising number of caregivers. Nearly one third of seniors are caregivers to an older relative or friend.
In approximately 20 years, seniors will make up about one quarter of Canada’s entire population, most of them women.
“The stereotype that the older population is set in their ways, not interested in new products, are very price sensitive and unlikely to switch brands must also be rejected, the report concludes. “More advertising needs to be directed at the older population showing them as interested, active and open to change.”
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