New Era for Senior Consumers
July 28 2003
The latest report from Datamonitor, 'Targeting Seniors Effectively', heralds a 'new-age' of senior consumerism in the UK and Europe, revealing that 50-64 year olds, in particular, are one the most affluent segments of European society, yet overlooked or misunderstood by marketers and the packaged goods industry.
Between 1997 and 2007, the number of European Seniors is expected to rise from 127.4 million to 147 million. Possessing high disposable incomes, many can be considered Well Off Older Folk (WOOFS) - the mean disposable income for 50-64 year olds in the UK in 2002 was over 25,000 Euros according to figures from Datamonitor, OECD and Eurostat, as against a European average of Euros 19,800. In the UK the figure is expected to rise to Euros 27,487 by 2007. The drivers behind this income trend include 'empty nests', higher earnings, an increased likelihood of a large inheritance and lessening impacts of long-term financial payments.
| Distribution of mean net income per capita by age, 2002-07, UK |
| € / year per capita |
|
| Age | 2002 | 2007 | % change
2002-2007 |
| 25-49 | 22,002 | 23,162 | 5.3 |
| 50-64 | 25,324 | 27,487 | 8.5 |
| 65+ | 16,294 | 17,359 | 2.6 |
| NB: 2007 forecasts are based upon inflation rates and 1997-02 trends identified from Eurostat figures |
Source: Datamonitor, OECD and Eurostat
'This rise in number represents an interesting social phenomenon as well as an exciting, yet often overlooked opportunity for the packaged goods industry. Changing attitudes and consumption habits of both current and future cohorts of 50-59 year olds will herald a 'new-age' of Senior consumerism' comments Daniel Bone, Datamonitor consumer markets analyst and author of the report.
There are high levels of inequality amongst Senior consumers, with those aged 65+ on a lower income and the gap likely to remain or widen due to the pension crisis. Consequently, principles of saving and simplicity remain highly applicable to Senior consumerism, particularly for older consumers with more conservative values.
The generation below present an altogether different prospect. Europeans now turning 50 mark the first generation of mass consumers who have grown up immersed in a consumer culture. Consequently, the manner in which they will behave and consume will be markedly different from their parents, says the report. They are more and more likely to become adopters of so-called youthful brands.
'Contemporary Seniors are also subject to greater influence from their children' says Bone. 'Due to delays in the average age of first births and a growing tendency for young adults to remain in the parental home for longer, current and future cohorts of Seniors will be subject to growing influence from their off-spring. This will only further enhance their tendency to adopt consumption habits typically associated with youth culture'.
Bone also says that seniors have become increasingly cynical about advertising, which has turned away from simplistic to abstract messages, often linked with lifestyle statements and stereotypes irrelevant to older people. The view of seniors as among the most 'brand loyal' is a myth: 'In reality, many Seniors are moving into a new phase of life ready to experience new things, particularly once they are unencumbered by children'.
Despite reaching these general and far-reaching conclusions, Datamonitor finds that the over 50s across Europe are a highly diverse group of individuals, both in terms of attitudes and lifestyles - more detail is available in the report - see
www.datamonitor.com
All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas unless otherwise stated.
