Marketing to Older Adults In the Era of Longevity: A Call and Guide to Action
by Dan Aks and Kim Leone, Undertone
The Global Coalition on Aging (GCOA), the world’s leading business voice on aging, convened its third High-Level Silver Economy Forum on December 6th and 7th in New York. The forum primarily concentrates on promoting policy that aligns with health and public finance for improving senior citizen lives via prevention and/or remediation. Dan Aks, Undertone by Perion President, had the privilege of moderating a panel called The New Joy: The Future of Fun in the Silver Economy which focused on tapping the commercial aspects of the enormous wealth and spending of older adults, and the self-induced hurdles to reaching that market. Addressing the senior market can be both highly profitable and enjoyable for product designers and marketers and offers a large swathe of our fellow citizens a chance to reap the rewards of fun earned through their long years of contribution.
Stereotypes persist, however, preventing maximum access to and exploitation of the market. The truth is, the “New Old” has arrived. Adventure travel, augmented reality headsets, online dating, fashion statements, movies about grown-ups — this is no longer your grandparent’s retirement life. And with this perspective on living and new, enthusiastic active aging comes the advent of a new focus on fun for a population that has been heretofore ignored or relegated to rest and passivity. Businesses
have been slow to adjust their scopes, yet this older market controls the largest portion of disposable income and research backs the benefits of fun both for healthy longevity and for economic growth across industries, from travel and leisure to gaming and technology. This panel’s primary objective was to discuss how the exploding Silver Economy opportunity is reshaping the customer base and business.
OPPORTUNITY IN THE OLDER MARKET
Much of why the extraordinary wealth and desire to spend is ignored is based on myths, ignorance, fallacies, prevarications, ego, and laziness. Several factors really make this a sad situation.
● Global populations are aging, an inexorable fact¹. This leads to wealth concentration and a shrinking target market, particularly in developed countries.
● A slowing economy does not tap the hundreds of trillions of dollars of wealth globally — $77 Trillion in the USA alone
— which is controlled by older adults. As the WSJ noted, there is a Silver Bullet in the Silver Economy2.
● Spending growth by older households exceeds that of younger households.
● Seniors are living longer with healthier life spans³.
● Seniors spend a great deal on grandchildren and other family members.
● Aside from the commercial profitability left on the table businesses are ignoring humane, quality of life issues for a vast and growing market segment. So much for honor thy father and thy mother!
MARKETING OBSTACLES
Despite this tremendous wealth concentration and willingness to spend, the best estimates are that brands spend 10% or less of their marketing budgets (and likely their product development and R&D) on older adults. Additionally, a large portion of even that 10% is likely for healthcare-related products.
Let’s explore the reasons for this glaring and seemingly irreconcilable illogic from marketers on why they eschew marketing to seniors:
1. MYTHS:
● Myth #1: There is a belief that older adults are brand inflexible and thus not swayed by messaging.
The truth, according to one study, is that more than 52% of seniors expressed a desire to change brands and are willing to explore.
● Myth #2: No point in marketing technology to seniors, they can’t get it.
The truth: see the chart below. Online game growth is not Gen Z or Even Gen Alpha; 65+ is driving the market!
● Myth #3: This is a painful one to even report. Many marketers believe Lifetime Customer Value (LCV) is low as seniors, even if adopted or through conquest, do not live long enough for adequate cost of acquisition ROI.
The truth: With ever-growing longevity, seniors can be customers for decades. Parenthetically, the notion that
a 15-year-old is not capricious enough to frequently switch to whatever is trendy and drive long-term higher ROI is rather hilarious.
● Myth #4: Seniors don’t spend money.
The truth: Spending growth by older households from 1982 is up 34.5%, double younger households over the period.
● Myth #5: Brands absolutely cannot market to older and younger segments simultaneously.
The truth: that has not hurt brands such as Nike with its Spike Lee led ad⁴.
There are many myths surrounding the ageism issue. The above are not meant to be comprehensive.
2. STIGMA AND PREJUDICES
Two stories fully demonstrate the extent of the stigma and sheer prejudice.
Story #1: One of our distinguished panelists relayed a classic example of marketing to seniors. The panelist runs a digital reader business. The initial marketing was to youth. However, the leader quickly realized that the far broader market was with seniors. He then began the process of shifting all related marketing programs, only to run headlong into internal staff resistance. The staff simply did not wish to be “relegated” to marketing to seniors, somehow seeing this as a step back, bad for their resume, not cool, or for some other reason. Eventually, many of the staff self-selected out as the leader wrenched the organization to be market-focused as opposed to resume-focused. Imagine that a large percentage of staff would prefer to leave their roles rather than market to seniors!
Story#2: A large magazine group featured many titles aimed at women. Like most groups, selling group sales is preferred over single title sales to garner larger ad budgets. Incentives are often added to induce buyers to do so. In this case, a razor brand asked for the classic target aimed at 18- to 34-year-olds. The publisher of a title aimed at women above that demographic recommended consideration, as there are far more women over 34. The agency would not do so, to which the publisher retorted, “Did I stop shaving my legs when I turned 35”? This is a perfect example of the pervasive thinking that a brand cannot serve different demographics because it loses its cache through multi-demographic marketing. While there is some truth on the marketing paradigm, brands should be working to allay this prejudice (see prior Nike ad) rather than feed it. The price of not doing so is steep.
SUCCESS EXAMPLES
All is not doom and gloom with product and marketing aimed at older audiences. Some businesses understand the paradigmatic shift and are making hay of it.
For example, the cleverly named Road Scholar is an organization aimed at educational travel for older adults, and is by any measure very successful, with over 6MM participants. Older adults love to travel and learn, and Road Scholar offers just that.
Another example is digital readers, as demonstrated by Rakuten Kobo. They market to all, with special marketing attention to seniors. They’ve won product design awards and have approximately $300MM in annual revenue⁵.
At the forum, an Amazon ad was shared which featured several older women tobogganing down a snow-covered slope and thoroughly enjoying themselves. As they slid, younger versions of themselves were superimposed, showing how they enjoyed the same activity as youths. This was a beautifully rendered ad from an artistic and emotional effectiveness standpoint and screamed that Amazon recognizes that it is just not girls who want to have fun. And that’s not all they really want. Amazon is among the sharpest students of trends, and ignoring what they do is done at one’s own peril.
MARKETING TO SENIORS
Companies are leaving vast sums on the table and worse, auguring future profitability issues as the global population ages. To reverse this futile trend, a few selected thoughts for brands. This list is not comprehensive:
1. Realize the vast wealth concentration and take specific organizational steps to address it.
2. Dispel the myths listed in this article that surround marketing to older adults.
3. Change enterprise internal stereotypes and prejudices. Easier said than done, but increasingly mandatory to enterprise viability.
4. Understand how to market to older adults. This includes:
• Seniors are more experienced and recognize utility. In addition to using classic celebrity branding and other tactics, speak more directly to application.
• People over 50 have been Internet savvy for close to 30 years. Use digital advertising that is not easily missed by ad blindness. Video is particularly effective when combined with purchase information, making things easy.
• Use ads that appeal to seniors, not recycled ones. Again, the Amazon ad was spot on and can be conceptually emulated.
• Ad content should focus on positive messaging such as why seniors have earned the right to enjoy.
• Avoid language that focuses on age. It is a turn off.
• Segment the market. Seniors are massive and diverse. Messaging and targeting should reflect this, so dynamic creative is especially important.
• Seniors will be more value oriented than youth. Appeal to it.
SUMMARY
Marketing to older adults globally is an often neglected customer segment. Therein lies a massive opportunity to expand sales and do societal good by recognizing a clearly underserved market. While this requires sometimes painful internal recalibration, profit and humanity demand it.
We’d like to thank Michael W. Hodin, GCOA CEO, for his unrelenting efforts to improve humanity and for offering Undertone a chance to learn and contribute to this absolutely critical dynamic.
Sources:
1 https://www.un.org/development/desa/dspd/wp-content/uploads/sites/22/2023/01/WSR_2023_Chapter_Key_ Messages.pdf
2 https://www.wsj.com/economy/consumers/us-economy-seniors-spending-money-d9f529c5
3 https://www.who.int/news-room/fact-sheets/detail/ageing-and-health
