Elderly Chinese consumers (respondents aged 50 and up) in China are feeling underappreciated by retailers and marketers, according to new research by Mintel.
With Asian retailers inparticular expecting a bump in sales due to fast-approaching Chinese New Year, this key demographic’s potential remains latent, even as a fifth of elderly consumers claim to specifically buy food and drink for special occasions, and half (49%) of elderly consumers claim to be spending more time with family and friends – but it appears that brands may not be taking this into account, said Mintel.
With life expectations reaching new highs in China, quality of life for the elderly is rising as well, researchers found. Indeed, post retirement, 57% of retired survey respondents say they exercise more, a third (31%) say they cook more, 20% go on holidays and travel more and – importantly at Chinese New Year – 16% say they go shopping more.
Still, just 8% of elderly Chinese consumers feel advertising is aimed at them and the same number (8%) feel shops and companies don’t cater for retired people, said Mintel. With nearly half (46%) claiming to be enjoying life more post retirement.
Matthew Crabbe, research director Asia Pacific, at Mintel, said: “Evidently, efforts by Chinese retailers to capture this important market segment are insufficient, as China’s elderly, clearly a group with money in their pockets, do not feel like there are enough goods or services that are targeted at them. With Chinese New Year around the corner, we are seeing a high proportion of elderly consumers buying food and drink for special occasions, showing the social aspect of product buying is important to how elderly consumers spend their money. They want to share the good times with friends and family. The importance of family time, creating good memories and celebrating occasions is strong – highlighting the opportunity for brands around Chinese New Year.
“China’s elderly are trying, as much as they can, to enjoy their retirement and keep healthy, active and entertained, but products and services need to adapt to serve their needs, rather than miss out on the opportunities this growing consumer group represents. Entertainment, value-for-money and sensitivity to needs are therefore key ingredients of the future marketing of products and services to the elderly. Elderly Chinese do not want to be regarded as ‘past their prime’. Marketers need to focus on positive messages in their advertising, promoting old age as a time to celebrate, rather than one of mere survival.”
Highlighting the potential for this demographic to spend, over a third (34%) say they have no worries about their financial future and 4% say they actually have more money than they had previously, the research found.
After covering necessities such as bills and other necessities, retirees show a strong propensity towards spending on experiences rather than on possessions. Days out top the list of things extra money is spent on – with nearly half (44%) claiming to do this. Meanwhile 35% claim to spend extra money on dining out and 20% on air travel. But security also remains a big issue, and retired Chinese will continue to invest in taking care of themselves (almost one in five (19%) will spend on personal care products) or their finances (nearly a quarter (24%) will put cash aside into “rainy day” savings funds). The importance of the leisure and entertainment sector to this age group cannot be underestimated, as over half (53%) of elderly Chinese consumers claim their social life has improved since they retired, 27% welcome the opportunity to try new things and just 9% claim to find it hard to find things to do to fill their time.
When it comes to which goods post-retirement consumers are purchasing, pharmaceuticals top the list, with 38% claiming to be spending more on this sector and 49% about the same. Small electrical appliances follow, with 16% claiming to be spending more on these. Household cleaning goods (with 15% spending more on these), consumer electronics (13%) and toiletries 10%) make up the remaining top five items the elderly in China are spending more on. Meanwhile, 9% of this demographic claim to be spending more on large electrical appliances and 5% on cosmetics.