THREE MILLION SENIOR CITIZENS AGED OVER 65 BY 2060: A MARKET WORTH ITS WEIGHT IN GOLD

The Swiss population is living longer and longer, and pensioners – who are increasingly well-off – are also staying active for longer. The TTC programme took a look at the companies aiming to tap into the "silver economy".

In Switzerland in 2015, more than 402,000 people were aged over 80, accounting for 5% of the total population. By 2030, this figure will rise to nearly 690,000, an increase of almost 70%.

By 2060, the number of people aged over 65 will have doubled compared to today, rising from just over 1.5 million to 2.98 million, according to projections by the Federal Statistical Office (FSO).

These figures raise questions about the social insurance system, which was introduced in 1948 when life expectancy was just 65 years, but they also offer prospects for economic development in many sectors.

“Thirty years ago, the typical life path went something like this: I work all my life, I remain loyal to one company, I look forward to retirement and, a few years later, sadly, I pass away. Today, with life expectancy and health in retirement, people want to travel, to do things. The outlook is another 30 years in retirement. That’s a huge amount of time; we must make the most of it,” notes Blaise Willa, editor-in-chief of the French-speaking Swiss magazine for the over-50s “Générations”, in TTC on Monday

A cautious Swiss market

So whilst start-ups are beginning to take a keen interest in this “silver economy” market – a reference to the greying temples of these new marketing targets – the market is still very underdeveloped in Switzerland. Supermarkets such as Migros and Coop are only just considering new product ranges aimed solely at senior citizens, notes the TTC programme.

"In many countries, such as China, the United States and France, public policies have been put in place. In France, it began in 2013; that’s when the term ‘silver economy’ first appeared. The focus was on transport, safety, retail and food, and this led to a law that was passed by the French Senate in late 2015,” explains Frédéric Serrière, a strategic advisor on demographic ageing to senior executives.

In Switzerland, there is still a great deal of concern at federal level about the issue of pension funding – with the ‘Prévoyance 2020’ project, for example – but little about the practical adaptation of daily life for these seniors who are getting ever older.

"The market is rather cautious. There are SMEs and start-ups that believe there is a success story to be made here; so we are seeing products emerge, but we cannot yet say that the major groups are very much involved. However, from 2022 onwards, the market will grow significantly, with the peak expected in 2040," notes Frédéric Serrière.

Wealthier

If older people are becoming such a key marketing target, it is also because they have become more affluent and are spending more. Households of retirees aged 65 to 74 have an average monthly income of 6,431 francs (see table below).

And whilst a young working couple will spend 438 francs a month on leisure and culture, a retired couple will spend 598 francs in this area.

Nationwide, however, the monthly income of a retired couple remains lower than that of a working couple. And it decreases as they get older.

However, in Geneva or Zurich, according to the 2010 Geneva statistics, retired taxpayers possess significantly greater wealth than those in work. Thus, whilst they account for 24% of tax households, those aged 65 and over hold 49% of net wealth.

>> The table below compares the trend in wealth by age group (hollow circles) and the decline in monthly income (solid circles)

The Geneva Cantonal Statistics Office also explains these figures by a longer period of saving, more frequent inheritance and third-pillar capital. The 65-and-over generation is also the one that has contributed to the second pillar throughout their lives and therefore receives the full amount. They thus have significant purchasing power and are accustomed to spending.

Targeted marketing

Certain markets more directly linked to the world of senior citizens, such as opticians, have understood the importance of developing products, but also of finding the right way to speak to this audience.

"Marketing adapts. We have Lara Gut for the young and Bernhard Russi for the older generation."
Daniel Mori, President of Visilab

At Visilab, adverts target different audiences with different messages. Retirees account for 50% of the company’s turnover.

"Ultimately, what has changed the most today is marketing. Instead of a one-size-fits-all approach, it is tailored," notes Daniel Mori, president of Visilab.

"It’s a trend that has been developing for the last four or five years," concludes a Swiss French-speaking advertiser in TTC. "The most promising sectors at the moment are holidays, insurance and sports brands."

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Source: RTS