In his 1996 book Only the Paranoid Survive, former President and CEO of Intel Andy Grove, described the concept in business of a strategic inflection point – that is a time in the life of a business when its fundamentals are about to change. I believe that point is rapidly approaching when we look the changing demographics that are happening all around us. At the beginning of the 19th Century the average life expectancy was below 50 years of age whereas today, largely thanks to advances in medicine and quality of life, people can expect to live into their 80s. This is leading us to an interesting situation where it is estimated that by 2045, the global population will have more people over the age of 65 than children under the age of 5. Another way of looking at this is that in the UK, someone is turning 50 every 40 seconds, while in the US this is happening every 7 seconds.
This demographic change has profound implications on society as a whole in terms of healthcare and service provision, but more importantly it also provides us with an amazing opportunity for new businesses and products, designed explicitly for this section of the population. Let’s look at some of the economic facts – older people have a greater proportion of societal wealth than any other age group, estimated at in excess of €3tr when looking at Europe as a whole. In the UK 50-plus households spend around £350B annually, accounting for over 40% of national household spending.
You would expect that this would cause a significant percentage of products to be aimed at older people, yet almost all marketing of products is targeted at the under-40s. There are opportunities here though not just for marketing but also for service development and product design. As people grow older, their needs change, requiring new services and products that specifically address their requirements. This could be anything from wealth management, to healthcare products or household appliances. A number of white-goods manufacturers now produce washing machines that are specifically designed to address the challenges of ageing. These products have a tilted drum to enable loading and unloading without as much need to bend down and larger controls to address a reduction in dexterity. When Ford designed the Focus car, they encouraged their designers to wear a special suit that restricted their movement and caused reductions in sensory abilities. This helped to design a car that addressed some of the needs of an ageing population. Similarly, the design of the Intel® Health Guide, an in-home chronic-disease management platform took many of these factors into account by providing a large touch-screen, and simple software user interface.
Next month a conference will be held in Dublin to discuss many of the elements described here. The event is called The Business of Ageing and it plans to equip attendees with the basics needed to develop and accelerate their understanding of the 50+ market and learn from those who've already targeted this market, successfully and won.
What do you see as the biggest product gaps in this market or what mistakes have you observed?
(Background information sourced from www.businessofageing.com )