In a seemingly youth-driven culture, older adults have significant spending power.
According to McKinsey, people over 60 will contribute more than 40 percent of consumption growth in housing, transport, and entertainment—and that’s just in the United States.
But despite the potential of the newly coined “silver economy,” businesses often neglect the needs and preferences of shoppers over 50.
To reach the silver market, small business owners must ditch their preconceived notions, figure out what these folks value, and serve that up on a platter.
To help, this article corrects some commonly held myths and offers recommendations for engaging the silver market effectively.
Forget what you think you know about older customers.
Every generation embodies unique stereotypes. For members of the silver market—consumers aged 50 and up—most of those stereotypes paint a picture of people who seem hard to sell to, particularly in the digital era.
Let’s explore some of these myths.
Myth 1: They’re not online.
Social media may seem like millennial and Gen Z terrain, but baby boomers and Gen X haven’t escaped the phenomenon by any stretch.
While adults 65 and older were the least likely to say they use platforms like Facebook, X, or Instagram, their presence on social media has quadrupled since 2010 according to research from Pew.
The gap between general internet use amongst generations has also narrowed. As Pew notes, the difference between the oldest and youngest groups of adults using the internet was 56 percentage points in 2000.
Today, the difference sits at 24 points, with 96 percent of those belonging to the 50 to 64 age group and 75 percent belonging to the 65 and older age group.
Myth 2: They’re rigid and tech-averse.
According to research from AARP, 94 percent of older adults use text messaging; 88 percent use email; 74 percent are active on social media; and 67 percent communicate via video chat.
AARP also found that device ownership is significant among older adults:
- 86 percent own a smartphone
- 70 percent have a smart TV
- 59 percent use a tablet
- 28 percent own a wearable device
- 24 percent have a smart home-tech device
If the narrowed gap between internet use across generations is any indication, we’ll likely see adults 50 and older continue to embrace technology at higher rates in the future.
Myth 3: They’re more likely to be cost-conscious.
The spending potential of seniors isn’t limited to their savings accounts.
As the Wall Street Journal notes, American adults 65 and up accounted for 22 percent of spending in 2022, their highest share since the Department of Labor began tracking consumer spending in 1972. It’s also a notable jump from the 15 percent reported in 2010.
What’s influencing the increase?
For some seniors, the largest single-year boost to Social Security payments since 1981 (plus an adjustment to offset last year’s inflation) offered a much-needed reprieve from inflation and high interest rates.
For others, years of saving money and carefully managing their retirement funds endowed them with greater spending power than many of their younger counterparts.
Embrace challenges with older customers head on.
Tapping into the silver economy looks promising, but there are still some factors worthy of consideration for small business owners looking to plant their flag.
1. Differences in online behaviors
Everyone’s online these days, but age seems to determine how often. While nearly half of those 18 to 29 said they’re online “almost constantly,” only 22 percent of those 50 to 64 agreed. For those 65 and older, that number plummets to 8 percent.
With fewer opportunities to make an impression, you’ll want to make every impression count. That means getting to know your audience (first and third-party data helps) and tailoring your messaging—among other things—to meaningfully sustain their attention.
Generally, consumers over 50 prefer straightforward and informative marketing materials to funny, clever, or well-designed ones. They may also require or expect extra support after purchasing your product or service, so make sure it’s clear how to get in touch.
Bonus points for offering customer support on their preferred channels.
2. User experience apprehension
There’s some truth to the idea that older adults experience anxiety around technology. As AARP found, 68 percent of consumers over 50 don’t believe today’s tech is designed with them in mind.
It’s not so bad they’ll refuse to engage with it, but they do anticipate technology will be hard to learn and navigate. Naturally, this can create tension around digital experiences.
Simplifying your sales process is always a good idea, but with older adults, it could be a competitive advantage. To the extent that you can, replace complicated workflows across online channels with clean, quick user experiences. Bonus points for including gamification elements and A/B testing to personalize communication and get definitive answers about what works.
3. Income inequality is still a thing
Despite the uptick in spending within this group, not everyone over 50 can afford to ramp up their consumerism. As one Journal of Economic Inequality study notes, the income inequality of a group increases as the group ages.
Beyond offering promo codes and loyalty programs (the latter is especially popular among those 55 and up), consider how else your business might contribute to the over-50 crowd.
If you own a physical storefront, can you offer themed and/or networking events? If you run a digital business, are there opportunities to provide do-it-yourself resources that enable cost-conscious customers to save money?
Getting creative about how to make a meaningful impact is the best type of loyalty program.
The buyer’s journey never gets old.
The best small businesses are inclusive. Given the expected growth of the aging population, it’s time we gave their needs and preferences the tailored attention they deserve.
It may prove challenging sometimes, but like any mission worth owning, can provide big opportunities for the business.