Silver Generation: The Original Disruptors

Catering to the silver generation is not about just meeting their needs but also stepping up to fulfill their aspirations and building an age-friendly society. This essay attempts to address two questions – (a) can we define the Indian silver generation beyond headline numbers?, and, (b) if yes, how can we classify silver (focused) ventures out there?

17 July, 2021
Mahesh Venkateswaran

Peeling the many layers of the Indian Silver Generation

Here are some headline numbers that you come across in media articles or research about the silver economy, or broadly, the older adult and senior population in India.

  • India is home to 100+ Mn persons over 60 and this number is expected to rise to 173 Mn by 2026 (and 350 Mn by 2050)
  • India has 40+ Mn seniors living in urban areas with average spending power of ~40K rupees per month
  • India has a total of 270+ Mn people over the age of 45+ presenting an opportunity for the future.

Unlike conventional market segmentation of consumers (Gen-Z, millennial, etc) that are bound by age bands, group preferences and established digital channels, the silver generation is expansive, heterogeneous and unlikely to exhibit such collective purchasing behaviour or traits. The baby boomer generation of the West (post-war children), which is sometimes referred in the context of the evolution of the Indian market for older adults, provides very little context given that the Indian market is a bit paradoxical – burgeoning youth population, uneven demographics (some states ageing faster than others), rising middle class (expendable income) and structural dissimilarities (intergenerational bonds, economic and social disparity, urbanisation) – thus making them less comparable. Policy making around older adults has captured many of these base conditions, and the future of ageing essay shared earlier provides a glimpse into this evolution, and how we have an opportunity to reframe the conversation around ageing.

Today’s 70+ adult went through an economic period that had limited opportunities, careers largely driven by a steady job with a fixed retirement age, a much less technologically connected society, slower wealth accummalation, limited mobility and and lower access to higher education or specialized healthcare. The social context and systems, many of which have been challenged over time, have lesser influence in an interconnected world.

On the contrary, a 55 yo adult today represents a cohort that were the original disruptors, in both the economic and social sense. She is vastly different from her peers twenty years ago and influenced by substantial generational shifts in society and the economy. She is technology savvy, less likely to retire or stop working at a prescribed cut-off age, more economically independent, prefers to not be grouped as a senior or elder and is likely looking for a more balanced life supporting her career, health, wealth, interests and (family) needs in the future.

In the early stages of their careers (early 1990s), the Indian economy opened up and this generation was on the frontline negotiating these changes. They adapted to the new economic paradigm, and thrived in a liberalized and competitive economy, which was a massive shift from the ones in which their parents finished their working careers. This generation saw the emergence of first-time entrepreneurs, movement of families to newer cities and towns, job turnovers triggered by growth opportunities, wider business travel and disproportionate investments in health and education of their children. They also saw the rise in participation of women in formal workforce and gave us women leaders across many sectors, resulting in a whole new group of consumers. Some from this generation were rebellious in their own way, and built some of the most successful brands of today, created jobs and paved way for the normalization of entrepreneurship as a career path we see much more today.

As this cohort grows older, they are likely to navigate a different set of challenges. While improvements in medical science and healthcare access have resulted in longer lifespans for the general population, it is still inadequate when it comes to addressing healthcare needs for a significant proportion of our population. For example, age-linked medical costs continue to eat into retirement funds for many, and this is likely to influence mid- and later-life transitions for those in the financial prime of their working careers today. Massive technology shifts over the last two decades, and underlying algorithms, are also likely to greatly influence their choices. Personal preferences, triggered by changes in lifestyle, expendable income, mobility, etc are likely to drive their spending and purchasing behaviors. They are also more likely to evaluate alternate living arrangements and plan better for their health contingencies.

In short, this generation and their resultant behaviors are likely to shape the silver market of the future, and with more wealth than their less-wealthy demographic counterparts, they can sustain high levels of spending for a foreseeable future. I also believe they are likely to disrupt the demand side for products and services to suit their exclusive needs, seek better quality and more personalization in the decade ahead.

The rise of the urban middle class over the last 20 years is a good proxy to understand the at-large opportunities but the finer elements will be defined by collective experiences and a better understanding of their multi-faceted ageing journeys. While the key urban centres and an English-proficient audience are likely to drive market entry for such companies, expansion and growth is likely with affordable and accessible services in tier 2 and 3 cities and towns, delivered in a language and channel of their choice. The silver generation in India is a dynamic market and the next few years are likely to shape both the size and the scope of the opportunities, and help move away from the one-size-fits-all approach.

Silver Ventures: Who fits the bill?

One can differentiate brands/companies by how they approach this target segment. Some are strategic and see a long-term opportunity, others tactical and focused on increasing wallet share through better services, and some others, address exclusive needs of seniors.

In sectors like real estate, which started with senior housing projects, one can see the emergence of new senior living arrangements triggered by market needs. Industry forums like the Association of Senior Living in India (ASLI) that emerged out of the real estate sector continue to evolve and address some of these opportunities and challenges in the space. Similarly, hospitals are establishing long-term care units and offering geriatric care services/packages for elderly patients that include home diagnostics and care services, teleconsultations, etc for better convenience. While these businesses target multiple consumer groups, they have a strategic long-term interest in the opportunities presented by the silver generation. The insurance market with its low coverage among seniors is lagging behind but may spring a surprise with innovative produts that can mitigate the perceived risk in this segment.

The movement away from the current transactional approach to one that is built on deeper and sustained trust-based relationship serving various needs over time, may become an essential feature in a lot of these sectors.

Brands, on the other hand, are focused on gaining mindshare among the older adult population given their higher purchasing power, and are offering premium products and customized services that suit them.

Nobel Hygiene, the first company to launch adult diapers in India, recently raised ~95 Cr from investors and is a category creator and leader. It commands over 50% market share in the fast growing adult diaper segment, which was non-existent until they launched it a decade ago. Large and entrenched brands like Mahindra, Tata, ICICI, etc have launched special marketing initiatives and products to attract this consumer group.

One is likely to see wallet-share expansion in luxury goods segment (clothing, personal care, etc) and targeted products in service sectors like tourism & hospitality, banking, financial and wealth services, possibly aided by progressive campaigns featuring older adults.

Technology and talent continue to accelerate entrepreneuial ambitions and journeys, and I would bet on the emergence of multiple home-grown silver brands as category leaders in spaces that have been dominated by FMCG companies and conventional retail formats. For example, Fifty Rocks, an exciting new startup and community and lifestyle brand for adults over fifty, recently entered this space with the Amazing Greys personal care collection.

Eldercare/seniorcare companies are building a whole new class of services that are focused on unmet, underserved and unspecified needs of the elderly. They work closely with seniors, their families and caregivers to understand specific needs, develop a structure and model to fulfil their needs, and continue to evolve their services to meet anticipated/future needs of this population segment. While largely driven by home care companies providing ageing-in-place services, one can see emergence of specialized care centers and services, online commerce, assisted group services for travel, technology-enabled digital programs and events supporting active ageing.

These companies focus on improving quality of life of older adults, and particularly elders, provide convenience and help ease the care burden on their families. Such services can also have a disproportionate impact on reducing future healthcare costs while providing a secondary support system for incident and emergency response, and relief to seniors that may face issues of loneliness, anxiety or lack companionship.

They largely work with hospitals and a network of geriatric experts, build programs with industry practitioners, make available trained caregivers and allied healthcare staff, have deep knowledge about the daily needs of their older customers, and incorporate technology systems to monitor, measure and improve their quality of service. Some of them also provide mental health counseling, short-term medical assistance stays, manage online care and support groups, offer physical recreation centers and more.

In conclusion

The silver economy is an exciting and emerging sector that presents an opportunity for the private sector – businesses, brands, startups – to meet the needs and aspirations of a fairly diverse population group.

The emerging 50+ consumer is likely to drive product and service innovations, and new business models in the space. Corporates, by expanding their talent pool to include older adults and furthering the retirement age (ability > age), can have a significant impact in avoiding age-based discrimination in the workplace and continue to benefit from this immense talent pool. On the other hand, the rise in demand for eldercare services due to the pandemic has also brought awareness to issues and challenges faced by seniors, and a rise in startups in this space. This is likely to make the space competetitive and accelerate the journey towards enhanced standards, higher quality of care and more transparency.

For India to become an age-friendly society, we also need more philanthropic capital diverted to organizations that are working with elders in adverse conditions and participating in government-led efforts (like the newly launched Elderline services) to reach those that cannot access, avail or pay for such services. Support to medical and research institutions, skill development and evidence-based research can help shape the efforts in the space, to be one that is proactive and responsive in the years to come.

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