Older Consumers: The Great 21st Century Market Opportunity.
Older Americans hold most of the country’s wealth, but they also are the fastest-growing age demographic when it comes to their percentage of the economy’s spending, as evidenced by this graphic below that was in this recent Wall Street Journal story (https://on.wsj.com/3GdIWkE). While the historical narrative has been that older people are more affected by economic turbulence (especially inflation), this story suggests that their finances are relatively healthy. They have less need to borrow, so they’re not as affected by higher interest rates and are less at risk of layoffs than other consumers.
The average household led by someone aged 65 and older spent 2.7% more last year than in 2021, adjusted for inflation, according to the Labor Department, compared with 0.7% for under-65 households. Spending by older households is up 34.5% from 1982, compared with 16.5% for younger households.
The numbers are even more remarkable if we move the age line down. 83% of America’s wealth and 56% of consumer spending is concentrated in those 50 and older. The average age of a new BMW owner is 56. Nearly half of hipster brand Warby Parker’s eyewear customers are over 45. 80% of spending on luxury leisure travel comes from those 55 and older.
I guess this is good news for MEA, right? And, yet, there’s so little attention paid in the advertising and marketing world to older consumers, as evidenced by this cartoon depicting an MBA class. Why!?