While marketers around the world are enthralled with Millennials, they may be missing the opportunities afforded by another burgeoning group: seniors.
Tetra Pak, a global processing and packaging company, has released the results of a consumer study that highlights opportunities in the food and beverage market for seniors, those aged 60 and over, the fastest growing consumer group worldwide.
Libby Costin, VP global marketing at Tetra Pak said: “Seniors spend 20 percent of their income on food and beverages. They have more disposable income than previous generations, and are poised to become one of the most important consumer groups over the next decade with a total spending power of US$10 trillion by 2020. This creates a huge opportunity for manufacturers to respond to their needs.”
Still, only one percent of global innovation is targeted to seniors, Lynn Phillips, consumer and shopper insights strategist, told journalists at the launch of the latest edition of Tetra Pak’s annual Consumer Generations Whitepaper. This series analyses consumers by their age, needs and spending habits. It investigates senior consumer trends in food, packaging and shopping experience, and identifies product opportunities for producers, based on insights from 27 countries across developed and developing markets such as Japan, the United States and Brazil.
The study states that the over-60 population worldwide now stands at about 931 million across the globe. That number is expected to climb to 2 billion by 2050, with higher concentrations in developed countries where nutrition and medical care are helping people live longer. In the United States, seniors account for just over 21 percent of the population, while their numbers range from 5.3 percent of the population in Africa to 33.8 percent in Japan.
Costin points out that seniors generally are an ignored demographic, yet they control much of global wealth and purchase basic household staples regularly. In addition, seniors tend to be more brand loyal than younger generations, and represent a potential loyal customer base with at least 20 years of purchasing power. Aging U.S. Baby Boomers control about 70 percent of the country’s disposable income and account for half of the consumer packaged goods sales, the study finds.
Key findings of the study include:
- 32 percent of seniors actively look for products and services that help them live a healthy lifestyle.
- They prefer traditional tastes to “experimental” ones. This extends beyond the product to the packaging, which they want to look and feel traditional, rather than appear overly radical.
- Seniors are loyal shoppers. Once they find a brand that satisfies them, 30 percent usually don’t experiment with new ones. They also tend to shop closer to home, and in smaller stores.
- Seniors demand greater quality, with 92 percent finding product quality very important, and they are willing to pay more for it.
- Generally, they dislike being made to feel “old” by marketers. They prefer products and packaging that are subtle: ones that are ageless but appeal indirectly to their demographic, rather than those that appear directly targeted at them because of their age. For example, they find “For Seniors!” branding unappealing.
Seniors have more time and greater spending power compared with other demographics. This has led to the emergence of significant opportunities for producers who can respond to the habits of the fastest growing consumer age group around the world. Consequently, the study recommends that retailers leverage the overall in-store experience to guide senior shoppers’ product purchasing decisions and develop age-friendly stores.
Based on these findings, there are several implications for CPGs and retailers:
- Offer products with healthy ingredients. Seniors value a healthy, active lifestyle, and use food and/or drinks to improve their health. They are willing to pay a premium for products that meet those needs.
- Fortify food and drinks with additional minerals and vitamins. Seniors are heavy consumers of vitamins and supplements. Food and drinks that are fortified with additional minerals and vitamins aimed at promoting stronger bones, or better digestive or cardiovascular health are of significant interest. There is a particular opportunity for foods and products which meet these needs in developed markets, where there are higher incomes and a greater awareness of senior-specific health issues.
- Deliver products with less salt, sugar, calories and fat. Seniors are more focused on low-salt, low-sugar, low-calorie and low-fat diets than other adults. Offering products that offer less of the ‘bad’ is just as big an opportunity as those that offer more of the ‘good.’
- Packages have to be easy to handle, easy to open and easy to read. Getting older brings its own challenges which means that seniors look for packages and products which are more focused on their particular needs. For instance, they look for easy-to-open packages to overcome reduced wrist strength. Also, messaging on the packaging should be simplified and highly legible.
For more information or download a copy of the white paper, visit: www.tetrapak.com/US/about/newsarchive/food-beverage-opportunities-in-senior-market