Focusing 50+: Why Consumer Product Brands should look beyond Millennials
The millennial market segment has been extensively explored and dug into. Perhaps it’s time to break new ground.
Smart entrepreneurs are scavenging gold business opportunities in under-represented markets, such as 50+ customers. Products for older people still have a long way to go to reach its full potential and the opportunity shouldn’t be overlooked. Out of all age groups, 50+ is the group of consumers with the most spending power – globally their spending power will reach nearly $11 billion by 2020. Surprisingly only a few startups have acknowledged this or seem to be dipping their toes in the water.
People underestimate how involved and engaged older demographics are on social media and platforms, and not many direct to consumer brands have focused on them. Interestingly, over 55 year olds are the fastest-growing cohort of Facebook users. However it is not just the case that they are a vast demographic group, but that there is power of reach too. Cultural influencer and content creator @iconaccidental started a fashion blog and has 633K followers on instagram, and 75 year old Judith Boyd, @stylecrone, has 44.5K followers of her fashion feed too. Other platforms include online magazine about life after 60, sixtyandme.com, which has built a community of over 500 thousand women in the age group to help them fully embrace the opportunities of life after sixty.
Startups playing Bridge
Incontinence care brand Willow has launched an online subscription service of adult diapers for women and men. Willows’ ads resemble campaigns for trendy brands like Hims or Thinx, and is purposely established in New York, the cradle of the online boutique industry. Founder Will Herlands saw the potential for a direct-to-consumer model for adult diapers and the company already raised $2.5 million from Peter Thiel’s Founders Fund, FirstMark Capital and other investors, within a year of operations. “Adult incontinence is a $4 billion market in the U.S., and the vast majority of sales are still done in stores” said Herlands – also studies indicate that nearly 70 percent of menopausal women experience urinary incontinence at least once a month.
Hims, the direct-to-consumer brand dedicated to boosting men’s self-esteem by way of erectile dysfunction pills, hygiene products, and hair loss gummies, and sister brand Hers, are including and attending to all age groups, from teens to menopausal women and bald men. By age 35, two-thirds of American men already experience some degree of hair loss and by age 50, approximately 85% experience noticeably thinning hair. Men might not be so engaged or keen to discuss the common condition, but if the solution is made accessible, affordable and with a different (modern) approach, then what is the big fuss? Tackling hair loss can be as simple as getting shampoo at the local supermarket. The company is focused on normalising health problems by positioning their products as wellness items. Customers pay $5 fee for an initial online medical consultation which is required to purchase certain products, but because Hims is a direct to consumer brand, these cost 50% to 80% less than their retail cost.
Similarly, erectile dysfunction startup Ro (former Roman) raised $3.1 million in the funding rounds led by General Catalyst, and $88 million in a round led by FirstMark Capital – the latter will go towards investing in a quit kit to help people quit smoking. Startups might struggle and miss the mark in their aim to create products without first-hand experience of the mindset or the problem. What’s really interesting about this startup is that it didn’t come just from a market opportunity, but co-founder Zachariah Reitanostruggled with the same problem – perhaps it’s why he has paid extra attention to detail. Customers fill out a form online, physicians go carefully through the answers, and medications are then shipped in discreet packaging – cutting down the number of awkward and dreadful trips to the pharmacy.
Health care isn’t the only segment of retail that is boosting sales among senior shoppers. Digital wine club Lot18 has entered a segment where most of its customers are over 40 years old (65%).
These up-and-coming brands have made some noise by rethinking old business models which had been stagnant for a long time, whilst opening doors to a new market segment. We can expects lots more to follow their footsteps.