The Rise of an Ageing Market
Unless you've been under a rock for the past 15 years, you would know that here in Australia we are living in a rapidly ageing community with the most recent population snapshot released by the ABS clearly illustrating how Australia is getting older…fast. According to the ABS, the resident population of Australia in January 2017 was more than 24.3 million people. This accounted for at least 3.8 million people aged 65 or older or 15.6% of the population - an increase from 319,000 (or 5%) in 1927, and 1.3 million (9%) in 1977*.
The number and proportion of older Australians is expected to continue to grow. By 2057, it is projected there will be 8.8 million older people in Australia (22% of the population) and by 2097, 12.8 million people (25%) will be aged 65 and over**.
Leaping forward a few decades, by 2101, the over 65 market is expected to represent 33.8% of the Australian population (and the over 55 market 46.3 %).
Geographically, this demographic is largely concentrated in the eastern seaboard states, with South Australia and Western Australia also holding reasonably sized aged populations. Tasmania and the territories have much smaller aged populations.
This maturing population presents many challenges for governing authorities, but also opportunities around health, travel, aged care and housing.
An Abundance of Opportunities – Not surprisingly, many marketers now recognise the significant benefits that come with this growing senior market. A market which has rapidly expanded to become one of the largest and fastest growing sectors of consumers in Australia.
One indication of this is the number of luxury lifestyle communities for the over-55s which have exploded over the past few years, with many developers taking the opportunity to meet the unique requirements of the retirement sector.
Most people over 55 and many over the age of 65 are still in full-time employment, have low or no mortgage commitments and have significant discretionary spending power. They are also some of the biggest purchasers of travel, wine, home renovations, furnishings and homewares, cars, computers, mobile phones and eating out. Most are social media savvy, educated and informed.
The New ‘Young Old’ – This marketplace is diverse. Australians over 65 years old do not view themselves as “older people” hence they are also interested in products that are usually targeted towards younger consumers.
People in this demographic today want to be treated much the same as the younger generation. Like any other adult age group, they like to purchase cars and clothes, have an interest in travelling, eating out and being entertained. They are also concerned about health and fitness.
Not to mention, they are also spending on mobile phones, computers and other technological products.
When Age is Just a Number – Forget the twilight years as a time for winding down. When it comes to travel, older Australians are increasingly getting on planes and cruise ships to see the world and tick off their bucket lists, with the over 65’s sector being the fastest-growing globe-trotting age group. According to the Australian Bureau of Statistics, the
number of people aged 65 to 74 holidaying overseas jumped more than 80 per cent in the past five years.
Older people are also more actively looking for recreational activity and taking part in sports like golf. According to Golf Australia, 9.5% of golf players are aged 65 or over. Moreover, 60% of club members belong to the 55+ age group.
However, with longer life expectancy, comes a need for additional specialist housing – that includes a mixture of retirement housing and aged care facilities.
As a result, we are seeing developers construct villa-style dwellings and "vertical villages" in areas where only detached homes would normally be allowed – specifically catering for people aged over 55 and those with a disability.
The bottom line is that high life expectancy and low birth rates have resulted in an ageing population. As Australia’s fertility rate falls to 10-year low, it’s clear that the older demographic will control a large portion of Australia’s economy going forward.
*Source AIHW Report into Older people: www.aihw.gov.au/reports-data/population-groups **Source Australian Bureau of Statistics – Population Trends & Estimates (abs.gov.au)