A recent McKinsey podcast shared that when it comes to loyalty programs, a large part of the population is being ignored: elderly customers.
The podcast featured Jaana Remes, partner of the McKinsey Global Institute, and coauthor of the report “Urban World: The global customers to watch.” According to Remes, the elderly population will grow by more than one-third in the next 15 years, totaling about 222 million people, and account for approximately 51 percent of urban consumption growth, which is equivalent to more than $4 trillion.
That’s a pretty large base of consumers with some hefty spending power that many fail to market to.
According to the McKinsey podcast, the elderly consumer (60+ years) has some attributes that Millennials don’t have and that are very attractive to retailers.
- They were raised in a time of loyalty. This is the demographic that would shop someplace because of a great customer experience, they like doing business there and have developed a relationship with the company. Millennials, on the other hand, have more fragile loyalty ties to businesses and will defect much more quickly.
- The elderly generation has much more financial stability and, in many cases, has the credit and disposable income to make large purchases very easily should they desire to. Millennials are more likely to make less money, be saddled with student loans and have less disposable income.
All generations have buying power but simply make decisions in different ways.