For Japan’s older consumers, a trip to the shops is about much more than buying goods as the country’s retailers rethink how they’re catering for this growing demographic.
Retail giant Aeon has recently renovated 13 of its outlets located in busy urban areas to attract more senior shoppers. At Aeon Mall in the Kasai suburb of Tokyo, shops and cafes open at 7am to cater to seniors who tend to be early risers. Other outlets offer health check-ups, morning exercise spaces and specialty stores selling products needed by older people such as walking aids and smartphones for the hard of hearing. Meanwhile, Aeon has also trained its employees to better serve elderly customers who may be suffering from dementia, a disease which affects 15 percent of Japan’s elderly population.
It’s far from being the only one. Department store Mitsukoshi is encouraging older shoppers to spend time in store with ample seating and complimentary green tea served. Japan’s convenience stores, at the heart of many smaller communities, are also adapting to an aging population; the likes of 7-Eleven and Lawson are increasingly stocking nursing care products and easy-to-chew convenience meals while also partnering with service providers in new areas such as food delivery and home cleaning services.
Meanwhile, supermarket chains such as Kosugi are experimenting with mobile grocery stores, reaching elderly consumers in more rural or isolated areas who no longer have their own transport.
Giving older consumers what they want
“Japan’s silver generation, made up of retired Baby Boomers and those in their late 70s and 80s, prizes “early adoption” and a sense of community,” says Naoko Iwanaga, Research Manager at JLL Japan. “And while they may be getting older, they still like to be active with a healthy interest in health, sports and leisure oriented goods and services. Retailers are now taking steps to appeal to this affluent market.”
Many older consumers have substantial spending power with Japan’s so-called silver market worth 100 trillion yen ($800 billion).
“Baby boomers have lived through the period of high economic growth. Statistically their average amount of savings is high because they’ve traditionally been prudent,” says Iwanaga. “Now that their parenting period is over, their spending appetite is healthy, bolstered by their retirement bonus. They are willing to spend on their grandchildren, and splurge on events and experiences for themselves.”
This ties in with research from consultancy firm AT Kearney revealing that mature customers value social interaction, personal attention as well as “smaller stores closer to home … a clear organized, limited selection, with high quality products at good prices.”
Japan’s well-documented aging population means there’s a growing market in need of the products and services that the country’s retailers are increasingly rolling out. The number of people aged 65 years old and above currently accounts for over 26 percent of the country’s population, and is set to rise to 40 percent by 2060.
Yet it’s also key to position their offerings in the right way, rather than overplaying the senior card. A range of golf clubs from Bridgestone marketed as ‘tailored for seniors’ fared poorly in sales compared to a rival brand, which took a far more subtle approach by emphasising its clubs’ ability to allow the ball to travel farther.
And when Japanese cosmetics giant, Shiseido, launched its Prior range aimed at women in their 50s, it made subtle changes to its packaging such as larger fonts for older consumers to read yet targeted ‘adults’ rather an seniors. The campaign was also fronted by popular actresses Mieko Harada and Nobuko Miyamoto, in their late 50s and early 70s respectively, who were featured in active scenarios such as hiking in the mountains.
“Retailers need to take into account the needs of baby boomers while still remembering they are ultimately consumers – they want to feel good about their purchases,” says Iwanaga. “Retailers will get savvier when it comes to positioning and marketing their goods and services to Japan’s aging population.”
Indeed, some retailers have already got plans in place. Aeon Retail, for example, is aiming to have 100 outlets specifically catering to senior consumers by 2025.
Such moves could prove to be a lifeline for senior shoppers and a valuable income stream for the country’s recovering retail sector.
“We expect the market addressing to this generation to grow in the foreseeable future. Considering the population of this consumer demographic as well as the wealth effect on the back of rising equity prices, their consumption will help underpin recovery in the retail market,” sums up Iwanaga.