Targeting the Silver Tsunami
What your company can do to capitalize on the growing number of Baby Boomers in the marketplace.
I recently had a chance to listen to the CNBC entrepreneur and host of the hit show “The Profit,” Marcus Lemonis, at the Southeast Venture Capital conference. One statement that he made stuck and seemed applicable to a host of different businesses from retail to restaurants to healthcare. He made the observation that every day, 15,000 people turn 50 years old in the United States and that any business that was not catering to that market was ignoring a huge opportunity. A little research on my part proved that the man knows what he is talking about.
According to a Business News Daily article, the number of people over 65 is expected to double in the next 40 years and the number of people over 85 quadruple. Currently more than 80 million—35% of the US population—are considered to be baby boomers. This sector of the population also has the highest amount of disposable income and, important to businesses, are living longer than ever before. This is not an idle crowd. Baby boomers are traveling, eating out, living well and spending money on home improvements and equipment. Although no longer raising children, baby boomers are still taking care of their families and spending money on others. Since they are employed at a much higher rate than the rest of the population, many of them are supporting (often housing) adult children and providing for the financial future of their grandchildren.
Group travel agencies, cosmetic surgeons, crematoriums, and long-term care insurance are a few examples of sectors that have pivoted their products to better cater to seniors. One key industry that is benefitting from the aging population is financial services and planning. Still rebounding from the last wave of recessions, boomers are increasingly relying on professionals to help them manage interest rate and stock market fluctuations. An industry that has geared up in the last year to serve this demographic is the housing sector. Due to the building slowdown of the past few years, there is a shortage in housing stock suitable for those who want to downsize into homes that will let them “age in place.” Cities and counties are providing incentives to developers to build communities that meet the boomer’s criteria.
So how does a business take advantage of this demographic shift? First, evaluate your existing products and services in light of this market share. Your business may already have the goods or services that are suited for this age group but has just failed to carry out any targeted marketing. It may be that slight modifications in existing services would create an opportunity to exploit the “Silver Tsunami” as the baby boomers coming of age are sometimes known. Another strategy is to create a completely new product/service line to attract the boomer customer or user. Engage your sales and product team in targeted sessions to think through the big or small changes that can be made to make your company more marketable to the over-50 crowd.
The boomer market is also important in business-to-business transactions since many decision makers fall into the 50-65 age range. Your company would do well to learn how to sell to this group. Although not homogeneous, most baby boomers will have the following characteristics when it comes to sales efforts:
• These are people that still like face to face contact. They are unlikely to make important or monetary decisions without building a rapport with the person on the other side. Save the Facebook invitations and Twitter promotions for the millennials; the boomers want to know who they are doing business with.
• Give boomer customers your undivided attention. Although it has become more and more acceptable for people to check their smart phones or continue tapping on their tablets during business meetings, multi-tasking is not appealing to the 50-plus generation.
• On the product side, allow boomers the ability to touch and feel what they are buying. Virtual demos are not as successful with a generation that has made the bulk of its purchases at brick and mortar retailers.
• A boomer customer will be more influenced by her peers than by anonymous online ratings. This is a generation that is skeptical of Web based reviews and accolades. Talk to them about what their peers and colleagues are purchasing.
In a market fraught with competition, it is sometimes important to consider the obvious. A large and increasing marketplace is looking for a variety of goods and services. Make sure your business is in consideration.
[Business Insights is hosted by the Law Firm of Kumar, Prabhu, Patel & Banerjee, LLC. Sonjui L. Kumar is a corporate, transactional attorney and a founding partner of KPPB Law.
Disclaimer: This article is for general information purposes only, and does not constitute legal, tax, or other professional advice.]
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