Small businesses should chase seniors
The year 2014 marks the 50th birthday of the last of the baby boomers, who were born between 1946 and 1964. This group of 77 million Americans long has been an attractive target market for businesses.
This group makes up about 35 percent of the population and control more than 75 percent of the nation’s wealth. Now, as they move into their senior years, boomers are becoming potential customers for other products and services offered by small businesses.
One common misconception of older Americans is that they do not have money to spend.
While many of them have retired and are not earning an income, many do have substantial savings and pensions to spend. Also, especially since the most recent recession, many now are working past the traditional retirement age. Longer life expectancies also are contributing to this increase in people working into their golden years.
The biggest market for which boomers now are concerned may be health care.
According to the U.S. Census Bureau, 71 million Americans will be age 65-plus by the year 2030. In that same year, 20 percent of the population will be older than 65. That compares to the current 13 percent.
Today, 30 percent of aging Americans live alone, and 90 percent of that group say they want to stay and grow old in their own homes.
Michelle Maus, program chairwoman/assistant professor of health care administration at Tiffin University, stated:?”An emphasis ideally should be placed on building relationships and trust with your target market. It is essential for organizations to recognize that building relationships and trust takes time to develop.”
It is no surprise home health care for the elderly is one of the fastest-growing markets in the country’s fastest-growing industry. Home health care is growing at about 12 percent a year, well above the overall growth of the economy in recent years.
Mark Somodi, executive director at P.T. Services Rehabilitation Inc. in Tiffin, sees smaller markets such as Tiffin as ideal places for small businesses in this area.
“This drastic shift in the population creates numerous opportunities for small businesses and entrepreneurs to support the aging population while creating secure business ventures,” Somodi said. “The large health networks that have been created over the past decade can most likely support health services in the populated areas of America. However, rural markets will continue to see less access to health services; this is where the opportunities lie.”
A number of Silicon Valley technical firms are trying to address the effects of aging. These organizations, including the Methusaleh Foundation, were started about 10 years ago to improve, if not extend, human life. Groups of investors, including early founders of Facebook and eBay, are funding a group of scientists who are working on fixing the problem of aging.
As with any customer group, relationships are a key issue.
“Consider targeting the daughter or daughter-in-law, ages typically ranging between 45-60 years of age. This individual is typically the decision maker for an elderly family member,” Maus said.
Perry Haan is professor of marketing and entrepreneurship and former dean of the business school at Tiffin University.