Affluent seniors hold opportunities for formulators
The 50+ age group is becoming a key demographic with strong spending power that cannot be ignored, said Matthew Taylor, consumer market analyst at Datamonitor, and co-author of a series of new Datamonitor reports on senior consumers.
Taylor told FoodNavigator.com that the markets that show the greatest potential when targeting the senior sector include frozen foods and convenience foods such as ready meals.
Products that address health concerns with, for example, heart health or immune system benefits also show potential. And the over 50s are more likely to go for premium products and demonstrate strong brand loyalty.
Taylor said that one approach food manufacturers could take to target this market could be introducing added benefits to products through ingredients formulation.
Another idea would be to take advantage of the tendency among seniors to use the microwave a lot, again adding the convenience factor.
Alternatively, companies could follow the example of other consumer packaged goods in the non-food sector that have put a 40+ tag on products to appeal to older consumers.
Although Taylor warned that there was the risk of alienating other groups in doing so.
He said: “The seniors age group is expanding rapidly. “It is becoming the largest demographic in a lot of countries and it is quite an affluent age group - there is a lot of spending power.
“But it is important not to forget the younger consumers because in years to come they will be the seniors. Something that is marketed to seniors is likely to have less appeal to the younger age groups.”
Datamonitor analysis shows that the UK’s senior population for example exceeds one third of the overall population.
In total the senior group of consumers makes up more than 90 million people in the US and Europe (namely France, Germany, Italy, Netherlands, UK, Spain and Sweden), which is expected to rise to over 100 million by 2012.
Datamonitor said: “This should make the senior consumer particularly worth targeting in terms of potential market size alone.”
Taylor said that unlike other age groups, seniors have fewer commitments and tend to be “empty nesters” with no children, who may be retired.
Also, with substantial assets and significant liquid capital, seniors are likely to ‘upgrade’ and choose premium products, particularly those empty nesters who have less obligation to support the family and children.
Similarly, with increased consumer awareness of sustainability, many products made with natural ingredients cultivated organically, or sourced from specific origins, are becoming popular among this consumer group.
Taylor said they also carry the signal that they are “danger-free” and benefit from the natural substances they contain.
There also appears to be an attitude that few seniors can be easily switched to another brand, other than their preferred one, unless given at least a shot-term price inducement.
