(This article is adapted from Getting Older: How We’re Coping with the Grey Areas of Aging.)
In 2007, the University of Cincinnati unveiled Live Well, what it called an “unusual consortium” between its students, faculty and corporations, including Procter & Gamble (P&G), the consumer-product giant headquartered nearby. The goal: to research and develop product ideas for consumers age 50 and over.
The segment's needs, it said, were “underserved,” requiring a shakeup of models to find the sweet spot between those needs and what was feasible to produce.
Since then, Live Well hasn't commercialized a single product and is still looking for those sweet spots — the unmet and often unarticulated needs of older consumers, who have been largely ignored by youth-obsessed brand managers, marketers and product designers.
(MORE: Boomer Guru to Marketers: Wake Up!)
The Problem With 'Senior' Products
That's not to say there aren't products targeted at the senior circuit — Depend undergarments, Fixodent denture cream, MedicAlert bracelets, even Swarovski crystal-studded walking canes. And who can forget LifeAlert, made famous by late-night TV ads featuring the poor old woman who has “fallen and can't get up?”
The problem with those products — beyond the crummy ads — was that they highlighted and reinforced the debilitating effects of aging. Sure, they rack up sales and all sorts of everyday items have been tweaked to appeal to aging consumers. What existing products haven't yet done is create a lasting emotional connection with older consumers, the true litmus test of a brand. Nobody aspires to own adult diapers.
What Do Boomers Want?
Boomers don't want to just spend money on the things they need; they have the dollars and the desire to splurge on the things they truly want.
That's where companies so far have failed. And that failure will cost them: In 2017, approaching half of the U.S. adult population will be 50 and older and they will control a full 70 percent of the disposable income, according to data tracker Nielsen. By 2050, there will be 161 million 50+ consumers, a 63 percent increase over 2010.
“What I see going on now is a tipping point — it's all busting open,” said Ken Dychtwald, a gerontologist and author who runs a consultancy called Age Wave and has been studying seniors for 40 years. “Think of it as popcorn in the microwave. All of a sudden it starts to pop, and then things really start popping.”
Boomers have reinvented each stage of life they've entered. And they aim to redefine what it means to be old. “They're saying, ‘Hell, no, we won't go down to Florida,'” said Mary Furlong, author of Turning Silver into Gold: How to Profit in the New Boomer Marketplace.
“You'd have to be an idiot to turn your back on this humongous growth market,” said Jody Holtzman, head of AARP's Thought Leadership unit. If that is the case, an idiot wind is blowing across the private sector, to paraphrase the poet laureate of the boomers, Bob Dylan.
A Gray Area for Business
Alison Sander, who runs the Boston Consulting Group's Center for Sensing & Mining the Future, said only about 5 percent of her corporate clients really understand the nuances of the senior market — it's still a gray area for business.
That helps explain why only about 15 percent of advertising dollars are spent on this demographic, despite accounting for almost half of consumer packaged-goods sales, according to Nielsen data.
“I have been in meetings where I ask Fortune 500 CEOs what they would do about this market, and often their minds jump to assisted-living devices for dementia or grab bars for showers,” Dychtwald said. “They don't think of Lexus convertibles. They don't think of Amazon. They should.”
2 Boomer Myths That Marketers Believe
Marketers are stuck on a variety of myths about aging, including these two:
Older consumers buy the same brands they've always bought. As a result, marketers say, why bother catering to them? “If that theory was true, I would drive a Chevy Impala and wear English Leather,” said Dychtwald, 63.
They're cheap. Actually, a survey of 3,000 consumers over 60 by consulting firm A.T. Kearney found that they're not particularly price-sensitive, even if their incomes are below average.
The sheer size of the wave gives it buying power never before seen in an emerging group of elderly. These are the children of Mad Men, not the Depression.
Oxo: The Kitchen Tools Maker That Gets It
One company that understands that reality is Oxo, the kitchen tools maker. Its functional and easy-to-use “Good Grips” line has won countless design awards and sells in 78 countries. Fueled by its success, Oxo has expanded into baby products, office supplies, and medical devices like syringes. What it won't ever do, said President Alex Lee, is position a line of products for older consumers. Explicitly pitching seniors would be folly, said Lee, since they don't like being singled out and reminded that they're old.
So there you have it: The company that does such a great job of making products for seniors takes great pains not to make products for seniors. That's the paradox of the aging consumer.
And it helps explain why P&G's Live Well initiative hasn't notched a dollar of sales yet. Mike Sanders, a P&G design manager who has taken part in more Live Well projects than just about anyone, knows this all too well. One thing he's learned along the way: Seniors, he said, “have a hard time imagining what they need.”
Maybe that's because they're still figuring it out.
Excerpted with permission of the Publisher, Bloomberg Press, from Getting Older: How We’re Coping with the Grey Areas of Aging by Bloomberg News. Copyright © 2014 by Bloomberg L.P. All rights reserved. This book is available at all ebooksellers.