En español | Imagine an economy that ranks No. 3 in the world, after the United States and China. It's got more than 100 million consumers generating $7 trillion a year in goods and services. They're generally better off financially, with special interests in health, exercise, leisure travel, Internet shopping and digital gadgets. Every year, their numbers and buying power expand.
This is the 50-plus population in the United States — call them the "longevity economy." Whether working or spending retirement dollars, older Americans are one of the country's prime engines of commerce and jobs. In entertainment, apparel and other important sectors, they account for close to half of all spending. They hold 80 percent of the country's personal net worth; they pay $420 billion a year in federal taxes and $250 billion at the state and local levels.
Yet, they don't get the respect these numbers should command. Jody Holtzman, AARP's senior vice president of thought leadership, says that in Washington older Americans are too often viewed as "an unaffordable cost and financial burden." The fact is that "the longevity economy is a net plus for every age," he says. When people 50-plus spend money, it spreads clear across the country, generating jobs and opportunity — a car purchased by a 58-year-old, for instance, generates work for young assembly line workers and parts suppliers.
What's more, the group is underappreciated in corporate America too. When companies develop new products and services, they often overlook older consumers. Ads targeting boomers? They hardly exist. In a society that worships youth, "ideal customers" are thought to be in their 20s or 30s.
An AARP campaign is trying to change those perceptions by showing that older Americans are a huge unified market that more than pays its way in society and can handsomely reward companies that grasp its importance.
Of course there are already many products and services that cater to older people: retirement communities, portfolio advice, hearing aids, clocks with big faces, stents, drugs for chronic ailments, to name a few. But to truly tap the longevity economy, Holtzman says, companies need to move beyond traditional lines to provide things tailored to the tastes and needs of older Americans, helping them lead active, satisfying lives for as long as they can.
Some companies have recognized the opportunity. Fashion chains such as Chico's and NYDJ have built national brands by catering to women who have long left their 20s behind. The chains' catalogs and websites feature stylish models who look to be in their 40s and 50s. Newly founded Halsbrook is tapping the older apparel market with online-only sale of chic, high-end attire.
Founder and CEO Halsey Schroeder got the idea after trying to help her mother shop online for the kinds of clothes she’d long bought in upscale department stores. “She pointed out that all these sites — they’re so young, they’re so flashy. There wasn’t anything that appealed to her.” Halsbrook, launched in September last year, has a site that’s as non-flashily elegant as the labels it offers. Experienced consultants are available by phone, email or live chat to help customers make their picks. Clothes are shipped with handwritten notes enclosed.
The $200 billion-a-year consumer electronics market has also found ways to tap into this audience. E-readers such as the Amazon Kindle and Barnes & Noble Nook have done well from the start among the older demographic. Surveys for the Consumer Electronics Association show that 25 percent of the 55-plus population now owns an e-reader, not far from the 27 percent rate of people ages 18 to 24. And the 55-plus audience is roughly 2 1/2 times bigger, meaning that many more sales.
The math is sinking in with marketing strategists, says Shawn DuBravac, chief economist at the association: "Manufacturers and service providers are giving that cohort more attention than ever before."