Let’s talk demographics—specifically, how more of us are reaching those golden years. Back in the 1950s, kids under 15 made up 27% of America’s population, but now they’re at 19%. On the other hand, people over 65 have jumped from 8.3% to a solid 19.1%. Let’s call this group the Silver Age. What does this mean? It means industries like health care, retirement homes and cruises are on the rise, while education, maternity and car sales are holding steady.
Growth in the Silver Age Sector
Fast forward to 2015-2025, and the U.S. population is on track to swell from 321 million to 347 million. The catch? Around 70% of this growth will be people over 65, while the under 65 crowd is barely budging by 3%.
Economic Impact and the Role of Immigration
The biggest impact of these trends is on economic growth. Contrary to popular opinion, we need 1-2 million immigrants annually to support a 2-3% annual economic growth rate. Currently, a significant share of about 300,000 jobs being created monthly are from immigrants filling some of the over 9 million job openings. In short, labor shortages rather than unemployment has become a critical economic dilemma. This trend is also projected to continue for several years, especially with declining birth rates and a declining population in the child-producing ages.
New Chapters Later in Life
Getting older doesn’t mean life slows down. As we approach silver age, retirement considerations can replace career and lifestyle considerations. Yet it’s also a chance to put all that experience to work in new ways. The key is staying flexible and open to change, which can be tough, especially when longtime friends start to drift away or we lose them. Let’s flip the script on the retirement age debate and talk about how we can better engage the wisdom and experience of our seniors, maybe through part-time gigs or flexible work setups. There are lots of paid and unpaid opportunities to expand our careers with new opportunities.
Fostering Connections
We also need to maintain old relationships and build new ones. Calling old friends, meeting former colleagues and making new friends can be highly satisfying. Retirement homes, religious organizations, and fitness centers are examples of places where one can foster social relations. Trips and visits can enlarge one’s network. Complimenting people, having company, and hugging can all enhance relations. It’s all about nurturing the ties we have.
Financial Realities for Seniors
It’s a bit of a mixed bag financially for the older crowd. On one hand, they’re set to hold a hefty chunk of the spending power, yet advertisers aren’t targeting them. And while retirement is on the horizon for many, there’s a whole industry that could be ready to serve their needs that’s just waiting to be tapped. On the other hand, living longer can mean facing tougher financial and social challenges, like health care costs and loneliness, not to mention the hurdles in staying employed.
Health and Well-Being as We Approach our Silver Age
Health-wise, the story’s a bit sobering. Most seniors are grappling with chronic conditions, and the rise in dementia cases is alarming. Eighty percent of seniors in the US have at least one chronic disease and 70% have at least two, with heart disease, stroke, cancer, and diabetes among the most common. But there’s a silver lining: Staying socially active is a serious boost for longevity and happiness. In fact, being isolated can hit the healthcare system hard in the wallet.
Innovating for an Aging Population
Globally, we’re still figuring out how to meet the needs of an aging population. There’s a real need for a care system that can keep up with this shift. For example, a recent study conducted in the United Kingdom revealed that more than 50% of older adults who needed assistance with daily activities do not receive support.
Catering to the needs of an ageing population is a largely untapped opportunity, but the space is fragmented. This presents a challenge, but also a space for a broader ecosystem to grow, where brand, trust and reliability from a multi-stakeholder base are critical for scaling up innovation, fostering teamwork and addressing weaknesses that are critical for success.
By considering alternative approaches, measuring outcomes, and embracing change, organizations can enhance their effectiveness and adaptability in an ever-evolving landscape. This includes incorporating new approaches, intuition and out of the box solutions.
Contact us for a FREE evaluation and get an alternative perspective on your business. We’d love to help you identify ways to adapt to current trends. No one has time for BS—so we’ll cut straight to the point and answer any questions you have. Reach us at: 914-632-6977 or BShlensky@startupconnection.net
Dr. Bert Shlensky, President of StartupConnection.net, has an MBA and PhD from the Sloan School of Management at M.I.T. He served as the President of WestPoint Pepperell’s apparel fabrics business & President and CEO of Sure Fit Products. More than 2,000 clients have benefitted from his business acumen over the course of his long career. He now focuses on working with select startups and small businesses. Please visit our website: https://www.startupconnection.net/ for more information.
When someone asks you who your customers are, how do you answer? Do you answer based on your perception of them and who’s already purchasing your products or based on actual information? Chances are, you haven’t delved into your demographics as much as you need to.
What Are Demographics?
Demographics are, by definition, the study of a population based on factors such as age, race, sex, economic status, level of education, income level, and employment. It should always be the first step in estimating your potential, limitations, and focus. They are among the most critical and relatively easy factors to consider in your marketing, planning, and strategic decision making.
Uncovering key demographics can be a bit like taking a look in your professional closet. You probably have an impeccable wardrobe, but it’s tough to see all that potential when there’s a giant elephant standing in your way. It’s time to deal with the elephant.
Where to Start
I regularly see business plans that begin with defining their market as the 320 million people who live in the United States and eat, dress, or consume something. No matter what industry you’re in, that is the wrong place to start. You have to dive deeper from the very beginning.
Even if you’re not at the very beginning stages of building your business, you should be studying demographics often and delve deeply into the information at hand. It’s crucial to the success of your marketing efforts.
Here are some staggering statistics that will make you question the audience you’re marketing to, according to the US Census Report. Out of that 320 million people who live in the United States:
Between 2015 and 2025, the U.S population is projected to grow from 321 million to 347 million.
18 million or about 70% of the growth will be over 65 years old between 2015 and 2025
As a comparison, between 1970 and 1980 the 15-35 population grew 19 million showing the start of the baby boomers as the bubble in the population.
In contrast the under 65 population will only grow about 8 million people or less than 3%.
Similarly, the Hispanic population has grown from 3% to 10% of the population.
Since 1980 States like Florida, Texas and California are dramatically growing while rust belt cities like Cleveland and Detroit are rapidly losing population.
50% are one gender, which frequently reduces the market size
30-50% of are frequently too poor to buy many products or services.
Approximately 40% of the U.S. population is between the prime purchasing ages of 25-54.
What’s the point here? The beginning number you should be starting with is actually more like 30-40 million people versus 320 million people before you analyze factors like geography, lifestyles, and ethnicity. This increased diversity demands that you differentiate the totals from your market.
You can start to gather valuable demographic information about your market for free. There is a great tool available from the U.S. Census Bureau that lets you quickly understand the demographics in your locality. It doesn’t take long to gather information and you may be surprised by what you discover.
Understand Your Audience
Studying demographics is an ongoing process. Once you’re at the base line of understanding your potential customers, you must have your ear to the ground and start to identify trends.
For example, If you live on places like Orlando or hurricane regions, this can have a profound effect on your business. It is estimated over 100,000 people moved from Puerto Rico in the last few months. You will not see that number reflected in U.S. Census data.
You can’t just look at the numbers. You have to understand the people that the numbers represent and try to look at the factors that they deal with that you may not dealing with.
Here are some key things to consider when you’re studying demographics for marketing purposes:
Income: The reality is that the top 1% of the population accounts for about 80% of income and continues to increase while the lower 20-40% continues to struggle. Marketing to struggling service workers requires far different strategies than marketing to Silicon Valley millennials.
Social Changes: Women and minorities have not always been treated with dignity as consumers. My wife still remembers going to buy a car and being ignored by dealers and being called “honey.” Today, women and minorities comprise a significant portion of both car buyers and dealership employees. This demands respect.
The Internet of Things: The internet and its usage especially among younger people will continue to explode. Nearly every consumer-based market is dominated by businesses that are capitalizing on the internet of things like Amazon and Google. Recently, UPS increased its Christmas delivery time from 1-2 days because it could not handle the increased demand, which was highly predictable. Similarly, services like Uber, Air B&B, Amazon, and thousands of other businesses are disrupting their individual markets.
Analytics: Chances are that your competitors are already taking advantage of a myriad of advanced analytical tools. CRM systems are completely changing the game and giving businesses new opportunities to understand their customer base.
Ignoring demographics and demographic trends, whether on a small scale or large scale will be done at a business’ peril. You must make certain to constantly evaluate relevant demographics and demographic trends as they relate to your business both in the now and in the future. This includes both local and national trends. Demographics can be one of the keys to your business’ success or failure.
Contact me to learn more about how you can research demographics in order to help you market your business more effectively and remove that old elephant from your closet. Dr. Bert Shlensky, president of Startup Connection (www.startupconection.net) is a graduate of Sloan School of Management at M.I.T. He served as the president of WestPoint Pepperell’s apparel fabrics business & President and CEO of Sure Fit Products. Having provided counseling to over 2,000 clients, he focuses on working with select start up and small businesses.
Experts frequently focus on their ideas and execution. However, understanding your market’s key concepts can be just as critical.
“If you don’t know where you are going any road will get you there. “ – Mark Twain
As a business owner, there’s just no getting around having clear definitions for both your market and segments. Many of my clients often hate the work necessary to understand their markets. Having the U.S. population, which is made up of about 300 million people, probably won’t get you’re the results you want. In most cases, using segmentation (selecting targets according to sex, geography, income, age, etc.,) can reduce your market to the 5-10 million level, which is a much sounder target to have. Taking the time to define and segment markets can both, save you time and money, and improve results.
Here are the key concepts to consider in evaluating your markets:
Changing Environment and Structures
We are in a state of constant change that requires new and flexible analysis. Labor force, baby boomers, technology, the Internet are all well-known factors affecting most markets. For example, I have been coaching potential high school entrepreneurs and their focus on cell phone opportunities is incredible compared to older consumer’s. A simple Google search of current market trends for your product will help you stay in the know.
Old Paradigms and Structures are Failing
Many of our largest and seemingly most powerful corporations have experienced no growth or minimal growth or, worse yet, failed over the last ten years. Traditional retailers, magazines and newspapers, coal, and lengthy hospital stays are dying. In contrast, the Internet, cell phones, e-retail, and cloud software are growing exponentially. This may happen even faster as automation and Artificial Intelligence become more accessible. To offset stagnation, when growth slows down, try switching your focus to profit.
Changing Demographics Call for Open Systems and Collaborative Models
The greatest need for change is a commitment to open systems and collaborative models; particularly, in an era of ever changing demographic trends. Open systems typically reject bureaucracy, authority, hierarchy, and closed decision making processes. Instead they encourage participation, diversity, new rules, and, to some extent, chaos. For example, social media has greatly expanded communication and equalized communication. United Airlines response to the recent events is a good example of ignoring viral messages online and their impact on a brand’s image.
One of the biggest outcomes from open systems is the collaborative decision model. As decisions become more complex, the need for diversity, internationalism, innovation, and expertise are expanded.
Defining Your Market is also Based on Understanding Operating Characteristics of your Effort
I frequently argue operations can be the most innovative and best marketing tool. These can include customer service, delivery, price, quality, packaging, costs, going green, distribution etc. Amazon, Uber and Airbnb are the best examples of operations creating new market segments. There are many great resources like Shopify for retail, Mailchimp for marketing, Freshbooks for accounting, and Ship Station for shipping are innovative resources to help manage your business. Researching and discovering which model best fits your business, is a great place to start.
You Need to Welcome Measurement and Feedback
Start by observing, understanding, sharing financials, operations report, and sales reports. Adopt a collaborative management style and incorporating more information, data and analysis into your decision making improves performance and reduces mistakes. Tools like Survey Monkey, Google Analytics, and Google search can facilitate the process.
Simple questions to help you understand your market
Start by answering the following question from your own perspective with a little research, rather than any extensive analysis and time consuming reports. Once you’ve completed your initial answers, conduct research, such as, surveys and revisit these questions for a more complete assessment:
How are your company and its products or services truly different?
Do enough customers care about these differences?
How can you most effectively communicate your differences within budget?
Defining your market can identify significant opportunities and help reduce segments with little potential. In the end, you need to ensure that your offerings meet the needs of your consumer. Ignoring key concepts, such as demographics, market innovations, and operations, can put your business at peril. Similarly, understanding the opportunities in your market and needs of your customers can dramatically and positively affect results.
Your customer is everything. Consider, for the purpose of this blog, that your customer is a close friend or associate. Now, do you know what they like, their age, their personal quirks, or whether they like to shop based on reviews? What is their income level? Education? The more you know, the more you can target to them and make them feel good. In return, they will like you, then, trust you, and, finally, buy from you. Even better, they will send their friends. (more…)
Every economics course – at least the good ones – will cover the idea of “ceteris paribus,” and its meaning: “all things being equal.” While it’s central to every economics program, the term is taught early in the class, and then forgotten as the semester goes on, and unfortunately when the student becomes a business owner.
But it is essential that is remembered in business, and especially in decision-making. In everyday language, ceteris paribus translates into “every business plan or analysis assumes certain assumptions that must be valid for the analysis to be useful.” (more…)
When you want to stand out, reach out to Bert for the tools that will build your “sticky” brand. My focus is on understanding and analyzing your dilemmas and challenges, so your company becomes profitable faster.
Call (914) 632-6977 or email me at bshlensky@startupconnection.net. Don’t leave without signing up for our useful free eBook!
Feeling stumped or overwhelmed? Contact Bert at (914) 632-6977 or Email to start the process. Thanks!
When someone asks you who your customers are, how do you answer? Do you answer based on your perception of them and who’s already purchasing your products or based on actual information? Chances are, you haven’t delved into your demographics as much as you need to.
You can start to gather valuable demographic information about your market for free. There is a great tool available from the U.S. Census Bureau that lets you quickly understand the 
As a business owner, there’s just no getting around having clear definitions for both your market and segments. Many of my clients often hate the work necessary to understand their markets. Having the U.S. population, which is made up of about 300 million people, probably won’t get you’re the results you want. In most cases, using segmentation (selecting targets according to sex, geography, income, age, etc.,) can reduce your market to the 5-10 million level, which is a much sounder target to have. Taking the time to define and segment markets can both, save you time and money, and improve results.
Every economics course – at least the good ones – will cover the idea of “ceteris paribus,” and its meaning: “all things being equal.” While it’s central to every economics program, the term is taught early in the class, and then forgotten as the semester goes on, and unfortunately when the student becomes a business owner.