The Aging Consumer: Perspectives from Psychology and Economics

Citation

Cook, G.R. (2012), "The Aging Consumer: Perspectives from Psychology and Economics", Journal of Consumer Marketing, Vol. 29 No. 3, pp. 239-240. https://doi.org/10.1108/07363761211221774

Much has been written about the aging consumer and what changes are in store for the individual in the later stages of the life cycle. Among the US population in the 65+ age category, there are some 45 million Americans, and by the year 2020, one out of every six Americans will be 65 or older. There are many implications associated with a growing aging population: More and more individuals will become pensioners; a smaller percentage of younger persons will make up the work force; product and services requirements will to a great extent be driven by the aging consumer; companies will have to adapt their product and services mix to the aging population; firms will have to adapt to more efficient ways to reach out and communicate with the aging population; etc.

This paperback consists of a series of articles/contributions by several different writers and edited by three individuals. Each of the individual's contributions found within this book relates to the aging consumer and the complexities of deciding and meeting their specific product and services needs on an ongoing but ever‐changing basis. The book is divided into three distinct but related sections: “What changes with aging”; “Decision making as we age”; and “Older consumers in the marketplace”. In my opinion, and I think strongly insinuated by the authors, I think it is safe to say that all of us as “aging consumers”, will find specific insights in this books that may help (all) of us make better decisions regarding our futures and those of our loved ones.

Aging is associated with pronounced impairments in a number of cognitive domains: speed of processing information, working memory (holding information in the mind for brief periods of time), and longer‐term memory. Aging individuals will struggle with these areas in terms of reaching better personal decisions and better cognitive outcomes.

Spending patterns for older adults are quite different for the most part in comparison to their younger population segment. Much emphasis and time is spent on deciding on health care services, gifts, and charitable donations. The key for marketers in these key consumer goods and service categories is to fully research and understand just how aging consumers go about allocating their personal resources over their individual life cycles and how certain changing physical capabilities with age alter the benefits received from such acquisitions. Our authors state that researchers in this area are trying to combine the consumer life cycle model and the so called budget share model. The life cycle model can help explain the likely evolution of total spending as the populations ages, while the budget share model will help understand shifts in demand for products as both aging and a changing economic status take place.

The authors introduce the concept of Socioemotional Selectivity Theory (SST), which addresses the impact of time in predicting the goals that people pursue. The two time spans are limited and expansive. Typically the aged would be concerned with the limited perspective while youth may be more connected to the expansive time outlook. But researchers can refocus aging adults in certain situations involving particular products and services to a more now or expansive frame of mind (life is long – enjoy it forever!).

In terms of decision making for the aging consumer, the authors feel there are two different ways or modes of thinking in this key area: one is experimental/affective, with personal thoughts and feelings presenting themselves in a spontaneous and effortless manner, and the other is more deliberate in nature, with thoughts and feelings tending to be more conscious and analytical – more reason‐based and slower in nature. It is the later process that is more associated with the aging consumer.

Decisions by workers with regard to preparing adequately for retirement involves a lot of careful forethought in the productive years. Research indicates that some do and others do not prepare well for retirement‐pension plans, 401K plans, health care plans, etc. We know that consumption patterns and life style changes have to take place at the endpoint. Early financial planning is probably the answer.

Another aspect of aging has to do with the multitude of choices and alternatives that we are presented with today, producing difficult consumer decision making for the aging consumer. Some might feel “the more the merrier,” while others would say “this is mind boggling.” Again consumers tend to stay with a smaller consideration set and many times have favorite brands where the purchase decision is a habit.

One of the real challenging decisions facing many aging consumers deals with what, how, and to whom do they pass along their cherished items and possessions that they have collected over time and perhaps have been handed down to them by previous generations. On what basis should they make these decisions? Will their decision create friction and a squabble within the family? This area tends to be a very complexing and frustrating decision‐making process for the aged.

For marketers of consumer goods a key challenge tends to be how to reach the aging consumer in terms of media selection. Truth is, we must know what media they engage as well as from a program and time‐of‐the‐day standpoint if we are to reach them with a compelling marketing message. Even though we are in a high‐tech communications era that does not mean that the aging consumer is on board! It can be rightly assumed, I think, that many aging consumers might find high tech devices very intimidating and non‐friendly.

Are older consumers hard to satisfy? Is their general level of customer satisfaction at the lower end? Answer probably is, sometimes yes and sometimes no depending on the situation and the basis for comparing satisfaction: one product or service versus another. In many cases they are most satisfied probably with their long‐time brand. Many firms are practicing the concept of “age branding,” which involves creating brands specifically designed with the older population in mind. At least four options seem available here: age‐denial branding; age‐adaptive branding; age‐irrelevant branding; and age‐affirmative branding, i.e. adapting a branding strategy depending on the aging population's perspective on things.

In summary, without question population aging worldwide is a major phenomenon today and with it brings a myriad of personal challenges for the individuals involved as well as challenges and opportunities for those companies trying to provide answers and responses to the aging population's needs and wants as they push forward in the personal cycle of life.

This book has explored a number of these critical areas for the aging and has provided some excellent insights as to how to better understand and address them. A deep insight into these areas is important for all of us and our providers as we all age!