The silver hair market: a golden opportunity for business
Simon Lee, Senior Manager, Sustainable Business HK
Hong Kong is ageing rapidly. Government research published late last year forecast that over the next two decades, the number of residents aged over-65 will double to more than 2.2 million. Currently, one in every six people is a pensioner; by 2034 that figure will be one in three.
This translates into a huge and growing so-called ‘silver hair market’ – creating opportunities for business across a range of sectors.
For a few such sectors, the opportunities are obvious. Demand for care and medicine will, of course, continue to rise. But there may be new niches emerging. Currently, Hong Kong’s wealthy elderly are well catered for by private residential care homes, while those on lower incomes are served by government-supported homes. That leaves a significant chunk of middle-class elderly people with an unmet need for quality yet affordable care.
According to Yvonne Li, Founder and CEO of the International China Ageing Industry Association, there is a growing trend for ageing at home. Elderly people living in their homes may not have high incomes but may be relatively asset-rich. Consequently, insurance companies have launched financial products linked to real estate value. Some property developers have even ventured into social care – though not without significant challenges, due to the complexity of the business model.
Technological advances have made it easier to deliver care in patients’ homes. Smart and wearable technologies, as part of the connected ‘internet of things’, allow care professionals to monitor patients in situ and respond quickly when required. Hong Kong’s buzzing neighbour Shenzhen – often referred to as China’s Silicon Valley – is developing into a promising hub of such innovation.
Recognising the changing capabilities of older consumers, ‘universal design’ is a design concept that seeks to ensure products can be easily used by all, regardless of physical ability. Home appliance manufacturer Whirlpool has adopted the concept in its product development. Games console maker Nintendo has embedded it into core products, including the popular Wii.
For older people seeking to move around the city independently, universal access is just as important. The World Health Organisation’s Global Network of Age-friendly Cities and Communities, in which HKCSS is a participant, launched a guide in 2007 explaining how transport, infrastructure, property and other sectors can contribute. We already see this being taken on board in Hong Kong; for example, barrier-free design has been integrated into MTR’s recently constructed or upgraded stations.
Greater independence also calls for new, dedicated products and services. To cater to adults with physical limitations that make public transport more challenging, Uber Hong Kong has launched a door-to-door transport service. In Japan, 7-Eleven provides a special meal delivery service for elders. Fujitsu and a local telecoms partner have launched an age-friendly mobile phone with larger icons and text, simplified apps and louder sound.
When it comes to everyday products like food and clothing, the needs of the elderly can change over time. To address this, Japanese company Tokutake sells a range of shoes that help combat knee and hip pain, while preventing slips and falls. US brands Golden Gourmet and Liquid Hope provide nutritional ready-made meals designed specifically for older adults.
But it would be wrong to think of the elderly purely in terms of declining mobility and health. The Association of Retired Elderly (ARE), a Hong Kong-based non-profit established in 2014, promotes the ideas of active ageing and the ‘third age’ – a stage of life beginning at retirement and ending once a person begins to need nursing care.
During this third age, argues ARE Chairperson Dr Teresa Chu, many elderly people remain in relatively good health, have plenty of free time, and are financially sound. Dr Chu argues that nowadays, this time represents “the genuine golden years of adulthood”. Companies must look beyond basic needs to consider how they can support a higher quality of life.
In the UK, for example, Arena Travel is one of several companies involved in a partnership with Age UK offering tailored holidays for older adults. For everyday social interaction, Japanese company Kozocom has developed Kozo SNS Village, a dedicated social network for people aged over 50.
With both the US and Japan facing rapid demographic change, both countries are significantly more advanced than Hong Kong in their approach to developing and nurturing the silver hair market.
Link-age, a company based in the US, conducts research on the aging population and provides insights to help turn it into commercial opportunities. One of its companies, Link-age Ventures, actively seeks out and invests in companies providing products, services and technologies for older consumers.
Link-age has partnered with Ohio State University and Miami University to engage groups of older adults between the ages of 65 and 100 in co-designing projects in the areas of fashion, exercise, social engagement, e-commerce and automotive technology.
Similarly, the University of Cincinnati’s Live Well Collaborative seeks to understand elders’ needs and explore product opportunities. Global FMCG giant P&G, another advocate of universal design, is a lead participant in the initiative. Why are there no such initiatives in Hong Kong?
Link-age CEO and President Scott Collins says there is a strong business case for entering the silver hair market now: it is already large and growing, with significant demand – yet limited competition makes it easy for new entrants to establish themselves.
“If [companies] are willing to invest some time and money to deeply understand older adults and engage them in the front end of design and innovation, they can then help develop not only the products and solutions, but the go-to-market strategy and the messaging”, Collins argues. “There’s a huge space out there.”
In a 2013 report, the Hong Kong government predicted that a growing silver hair market would present business opportunities across many sectors. It argued there was “a need to proactively examine how best to explore these burgeoning business opportunities so as to benefit the whole community”.
Since then, there has been little action. There is now an increasingly urgent need for companies to establish initiatives and partnerships to better understand the emerging needs and preferences of our ageing population. Only then can they meet those needs effectively, as part of an inclusive and sustainable business strategy.