Silver consumers are not a single group

This is the second article we have written about the elderly. In the first article, "Do We Really Understand Older Consumers?", we shared some of our understanding of the elderly. In this article, we want to talk about the complexity and diversity of this group of elderly people.

1. “Old people”: an overly general term

By the end of 2022, the number of people aged 60 and above in China will be 280 million, accounting for 19.8% of the total population. According to the National Health Commission, the number of people aged 60 and above will exceed 400 million in 2035, accounting for more than 30% of the total population, and China will enter a severely aging society. If we only use "elderly" or "silver-haired people" to summarize these 300-400 million people, it seems too general in the current consumer goods market that constantly emphasizes segmentation . Not to mention that there are also a large number of people aged 50-60 who are also potential consumer groups that can be "exploited". In market research, we often segment a group of people with similar characteristics that have reached a certain scale based on needs (needs-based) or held concepts (attitudinal) to match the most suitable strategies and tactics. For example, the "mom" group can be further divided into follow-up moms, knowledge moms, and steady moms based on different parenting and consumption concepts, and then focus on products, selling points and channels in different price segments.

2. The elderly need to be segmented more than other age groups

Compared with young people, the elderly are more diverse and complex. Political, economic, social, technological and other factors have a more significant impact on them, giving them completely different life experiences and values.

From a macro-policy perspective, the country's complex pension policies have resulted in different pension and medical insurance benefits for urban and rural areas, those in and outside the system, those with longer or shorter working experience, and those in coastal and inland areas. These policies directly affect the quality of life of the elderly, especially retired elderly people . The impact of policies on young people is more reflected in education and employment, and may not directly bring significant differences to the current quality of life and lifestyle.

In addition, the economic transformation that China has experienced in the past four or five decades has allowed many elderly people to experience the people's communes and witness the reform and opening up. The sense of contrast between the times and the contrast of life brought about by these changes is rarely encountered by this generation of young people in a relatively mature market when they enter society. However, many elderly people happened to catch up with these opportunities in their youth and prime years . They missed or seized these opportunities, which led to the current gap between the rich and the poor and class stratification .

From a social and cultural perspective, many of the current elderly, especially the elderly, may not even have a primary school diploma, let alone completing nine years of compulsory education. There are huge differences in their cultural level and values ​​due to their education level, political environment, family background, etc. On the other hand, although young people today are generally facing a reduction in diplomas, on the other hand, it also proves that everyone's education level and cultural level are generally improving, ensuring the lower limit. In addition, the restoration of the college entrance examination has given many young people in small towns the opportunity to change their destiny and narrowed the gap between urban and rural individuals.

Finally, the underdeveloped transportation and communication in the past restricted many elderly people to a closed environment and information exchange when they were young, so different elderly people have completely different concepts and find it difficult to understand and tolerate different viewpoints. The emergence of the Internet has largely broken the geographical restrictions on individuals, allowing the younger generation to understand and experience multicultural possibilities, thus becoming more tolerant and open to different things and concepts. If Gen Z (born after 1995) is the Internet natives, Gen Y and Millennials (born after 1980 and 1990) are Internet immigrants, then most elderly people are Internet survivors.

From a macro perspective, the world of the elderly is not flat, but full of ups and downs. Taking these factors into consideration, we should no longer regard the elderly as a single group , but a group with huge differences in economic ability, cultural level, lifestyle, values, etc. The segmentation of the elderly population can be said to be important and even urgent for the increasingly competitive and sophisticated consumer goods market.

3. What dimensions are used to segment the elderly population?

When we generally segment young consumer groups, professional marketers have realized that mentalities and concepts can better reflect the differences among groups than demographic indicators, and it is easier to achieve precision marketing. But when it comes to the elderly, demographic indicators , such as age, place of residence, income, education level, etc., are still important classification criteria . Because there is often a direct linear relationship between these basic personal information and the values ​​and consumption behaviors it reflects, there is a relatively certain strong correlation between the two. In other words, we can use these demographic dimensions to initially portray the portraits of different types of elderly people, and then have a deeper understanding of their needs and behaviors .

Taking age as an example , a 65-year-old and a 70-year-old can have great differences in physical fitness and lifestyle. However, this 5-year age difference is not so obvious for young people. What really distinguishes the two types of young people is more likely their values ​​and consumption concepts. The same is true for differences in regions and city levels. An elderly person living in a first-tier coastal city and an elderly person living in a fourth-tier city without high-speed rail may represent completely different consumption capabilities and needs. The two young people who drift in first-tier cities and lie flat in fourth-tier small cities have the same media channels and consume similar media content because of the synchronization of the Internet. What really distinguishes them is still their outlook on life, values ​​and the consumption concepts reflected by them.

4. Marketing Inspiration

Faced with huge differences within the elderly population, some brands have realized that they cannot treat all elderly people as a unified consumer group for communication and customer acquisition, but instead they should segment specific elderly groups in a more targeted manner .

For example, Zulijian chose to go for the boy-next-door style and made basic models for the general public; while Xiangwu chose to show a more modern and open-minded look, hoping to attract the urban elderly with strong purchasing power through high-end and fashionable shoe designs. In the milk powder category, Yili and Mengniu subdivide middle-aged and elderly milk powder products by function, focusing on ingredients and functions in publicity, and targeting the general public; while Danone's Ganmai has begun to encourage the elderly to face life after 50 fearlessly, catering to urban elderly people with a more fashionable and youthful lifestyle.

In the past, we were always accustomed to viewing the "silver economy" as a type of people. In fact, we should see that the elderly population has the opportunity and necessity to be further segmented . The huge differences among the elderly population and the current relatively chaotic market situation also provide brands with more space and opportunities to formulate differentiated positioning.

Author: Researchism; WeChat public account: Researchism Consultancy (ID: ResearchismCo)