Mature retail customers worldwide, representing up to 30% of spending power, value personal attention from cashiers, smaller stores closer to home, high-quality products, place less value on checkout speed, large stores, cheaper products, finds survey

Cindy Allen

CHICAGO , September 26, 2011 (A. T. Kearney) – Retailers and branded marketers across the globe have an opportunity to meet the needs of an aging population that is massive, growing and global. This is one of the main findings of the new study released today by global management consulting firm A.T. Kearney. Mature consumers form a worldwide market segment that spent $8 trillion in 2010 and will be spending $15 trillion annually by the end of this decade. A.T. Kearney interviewed 3,000 people in 23 countries to find out what mature consumers are looking for in retail stores as well as from consumer packaged goods manufacturers.

In 1998, the number of people over age 60 overtook those under age 15 in the G7 (developed) countries. Based on current worldwide demographic trajectories, in five years there will be more people over the age of 60 than under five; in 30 years, there will be more people over 60 than under 16. When today's newborn babies reach college age in 2030, 36 percent of Germans, 30 percent of the French, 22 percent of Americans, and 30 percent of Chinese will be older than 60.

"One intriguing finding that emerges from the Global Maturing Consumer study is that in a number of different ways, the views of respondents seem to intensify, or to shift, after the age of 80," comments Martin Walker, senior director of A.T. Kearney's Global Business Policy Council. "The over-80s are globally much more loyal to established brands, and less willing to spend money on products that offer health benefits or are considered 'green.' After the age of 80, respondents are markedly more eager to have age-specific products and shopping environments tailored for them. It is almost as if 80 is the new point of self-definition for becoming old. If so, this represents a noticeable change from the traditional concept that old age begins at retirement."

These key cultural and demographical changes need to be addressed by retailers and branded marketers to meet the needs of this market segment. For the past 60 years, marketing and advertising strategies and much of our popular culture have been driven by the cult of youth. The nature and the image of aging are changing. People are active and healthy well into their 70s and 80s. Yet, while mature consumers want branded marketers and retailers to recognize the realities of aging, they do not want to be treated as "elderly."

A.T. Kearney's report finds that the mature consumer shops very differently from the younger generation. Although most retailers focus on speed and price competitiveness, mature consumers are more demanding on quality and services, and are less price sensitive. The central idea in modern trade has been to improve efficiency for shoppers. Larger stores outside city centers, lots of parking, and short checkout lines are all designed for less frequent, big-basket shopping. However, mature consumers, who represent up to 30 percent of spending power, spend more time in stores.

"For retailers," adds James Morehouse, A.T. Kearney partner and vice-president, "aging may mean a paradigm shift in the design of stores and retail chains. They want personal attention from friendly, talkative cashiers, not speed. They want smaller stores closer to home. They want a clear, organized assortment with high-quality products at good prices, not unlimited choice of cheap, average -quality products or quantity-based promotions. And for the growing number of those who have an internet connection, they go online to get information and buy."

For manufacturers, responding to the aging phenomenon will require a rethinking of product design, particularly in labels and directions, legible prices, and easy-to-open packaging. Mature consumers will take their time to get informed about dietary information while at the store, so they need easy-to-read information in larger font sizes. The good news for branded marketers is that mature consumers are much more brand loyal than younger consumers. Above all, manufacturers will need to work closely with retailers to coordinate an effective response to the aging consumer market.

The full study report can be downloaded at www.atkearney.com/matureconsumer

About A.T. Kearney
A.T. Kearney is a global management consulting firm that uses strategic insight, tailored solutions and a collaborative working style to help clients achieve sustainable results. Since 1926, we have been trusted advisors on CEO-agenda issues to the world's leading organizations across all major industries. A.T. Kearney's offices are located in major business centers in 38 countries. For more information, please visit: www.atkearney.com

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