The elderly are different than you and me, and it is not just because they are over 65. The habits of older Americans are, in many cases, much different from younger Americans.
Older Americans tend to have more savings. Many have passed the point when they have to pay for children and mortgages. They have to manage those savings as they move toward retirement. That makes them heavy consumers of financial services such as investment advice.
Some of the most obvious products and services bought in large numbers by people over 65 are easy to pick out. Older people tend to like large and comfortable cars. They are also heavy users of medications for age-related conditions.
However, some of the habits of people over 65 are not so intuitive. The elderly are consumers of social media in much larger numbers than many people would guess. On the other hand, they are not the dominant demographic for other activities where they used to be in the majority. The railings of cruise ships are still populated by travelers over 65, but they are joined by young adults with children who have flocked to cruises because the industry has made the experience more family-friendly.
Every year, the average age of Americans gets older. The huge Baby Boomer population has moved in great numbers to the 65 year and older bracket. The generations behind it are not as large, and that means that America has begun to gray. It will have to be left to Washington to decide how these citizens will be supported as the US deficit grows and the number of people who can be taxed or pay into the Social Security fund shrink.
As we set those larger problems aside, here are the products and services that target the elderly – although in many cases they are not terribly different from the interests of younger generations. Why should people over 65 worry about Social Security when they can spend their time on Facebook?
1. Cable News Networks
With the advent of the Internet, younger people have turned their backs on traditional television so, the average age of viewers has increased for many channels. For television news, most viewers are in fact seniors. According to recent Nielsen data, the average age of a Fox News viewer is 65. Similarly, 47% of CNN prime time viewers are 65 or older, as are 36% of MSNBC prime time viewers.
2. Social Media
While the conventional wisdom is that social media is a tool for the young, retirees are joining Web sites like Facebook and Twitter in record numbers. According to a Pew Internet study conducted between 2009 and 2010, the number of people 65 and older using social media doubled, while the eighteen to twenty-nine year old share has only increased 13%. Although younger generations still take up most of the market, this may only mean that the retired crowd are late adopters, and not that they will stay on the sidelines. Independent sites tailored for retirees, like eons.com and AARP’s hugely successful online presence, enjoy great popularity.
3. Casinos
Conventional wisdom holds that seniors take up more than their fair share of casino visits. In reality, they rank about average with the other adult age groups. Twenty-eight percent of those 66 and older visit casinos, compared with twenty-nine percent of those between 51-65 and twenty-four percent for those between 36 and 50. Given the fact that a majority live on a fixed income, it should be surprising that the percentage is as high as it is.
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4. Four-Door Full-Size American Sedans
Large four-door sedans with room for six and all the comfort of a barkalounger have been the premium name plates of America’s top car companies for decades. Their manufacturers prize plush interior and leg room over gas mileage. These cars are driven primarily by people above the retirement age. Three quarters of the customer base of the Lincoln Town Car, which was recently discontinued, are 65 years and older, according to J.D. Power and Associates.
5. Retirement Accounts
Today’s older Americans are much more likely to be invested in retirement accounts than younger age groups, according to the Bureau of Labor Statistics. The age group with the largest percentage of people with one or more retirement accounts are older Baby Boomers, classified as those born between 1946 and 1954 – standing at 72.92%. This group is followed closely by the “swing cohort,” those born between 1928 and 1945, who have not yet retired, of which 68.93% have a retirement account.
6. Landlines
Younger Americans are becoming increasingly reliant upon their cellphones, both outside and inside the home. AT&T and Verizon have consistently lost landline phone customers, and this has begun to hurt their earnings. However, older consumers keep their landlines, perhaps out of habit, or because their use of cellular phones is modest. Only 5.2% of people 65 and older live in wireless-only households, based on data collected by the Center for Disease Control in 2009.
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7. Cruises
Cruises are traditionally considered a luxury designed for those without children – theoretically perfect for retirees. This is no longer the case. According to a 2008 study, only 23% of cruisers are 60 or older, compared to 24% being between the ages of 50-59, 27% between 40-49, and 21% between 30-39. As cruise lines have made accommodations for children and young families, they have replaced seniors as the typical passengers. The median age of cruise passengers in 2008 was 46.
8. Financial Publications
Financial publications draw their circulations and online audience largely from older Americans – particularly men. Younger readers do not tend to have as much money in the markets. Barron’s, a highly regarded financial newspaper, targets older readers with larger portfolios. Barron’s has just over 300,000 paid readers and approximately 80,000 are over 70 years old. Another 70,00 or so are over 60.
-Douglas A. McIntyre, Michael B. Sauter, Charles B. Stockdale
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