Japan’s silver age spenders mean gold for business

Japan has one of the fastest-growing elderly populations in the industrialised
world, with one in five of its people already over the age of 60, twice the
proportion in Britain.

The ranks of Japan’s so-called silver age community have been swelling
steadily in recent years, as thousands of baby boomers born in the late
1940s – the generation which fuelled the nation’s powerful post-war growth –
give up work and retire.

Alongside the rise in the number of elderly Japanese has come a demand for new
products and services aimed at them. From cosmetics brands and travel
companies to magazines and car design, affluent retirees are spawning a host
of new business opportunities for companies struggling to make headway in
the saturated youth market.

The change of focus is being actively encouraged by the government, with
public subsidies for companies which develop services targeted exclusively
at the elderly.

Last week, the importance of this silver generation to Japan, both socially
and economically, was underscored in a new report which revealed that
spending by people over the age of 60 in Japan defied the national downward
trend in 2011, to exceed 100 trillion yen (£820 billion) for the first time
– equivalent to 44 per cent of the nation’s entire personal spending.

Hideo Kumano, chief economist at Dai-Ichi Life Research Institute, who
conducted the research, said: “Silver spending is a new opportunity in
Japan.

“It’s not necessarily because each elderly person is spending a lot, but
the number of elderly people is increasing and so the amount of silver
spending is rising.” The population is ageing for a number of reasons.
Growing numbers of women are delaying marriage and having children, in order
to focus on their careers.

The current economic uncertainty, which contrasts sharply with the lifelong
security of salaryman jobs enjoyed by previous generations, has contributed
further to a shrinking birthrate.

At the same time, traditionally healthy diets combined with better healthcare
have led to people living long into old age. The retirement age remains 60,
although the government has hinted that this may be raised to 65.

At the gym in Saitama a dozen elderly members, who are each picked up and
dropped off at home by a company bus, were enjoying a morning workout.

Some were stretching on the exercise machines, others were having a dip in the
hot spring footbath, while another group took part in a seated relaxation
session focusing on breathing.

Nearby, half a dozen other members sat at a round table as part of a group
session exploring how to use the internet on iPads, with some tapping into
YouTube and others learning how to check train times.

“Our company began in 1970 by offering swimming for children,” said
Terue Kamijuku, a senior corporate marketing manager at Central Sports.

“However, over the years, the market has shifted towards more elderly
customers. The average age of gym members is currently 50 and rising.

“It’s becoming important for sports clubs to have businesses which
specifically target this generation. This gym has programmes to help people
physically with exercises and mentally with iPad sessions. Socially, it also
helps creates a sense of community among the elderly.”

Among the younger members is Toyo Aki, 78, a retired petroleum chemist who has
taken up a string of hobbies and travelled extensively since retiring over a
decade ago.

“I am here mostly for the physical training,” he said. “I have
many hobbies, I love skiing and trekking in the mountains and I am keen to
recover the strength in my foot to continue with this.

“I also enjoy playing bridge and travelling. Japan is a very good place
to enjoy these kind of hobbies. If there is any country that is better than
Japan in terms of enjoying retired life, I’d like to know about it.”

In the past, several generations of Japanese families would traditionally have
lived side by side in one house, with the younger looking after the elder as
they needed more care.

Today, however, as in other western economies, more elderly people are living
alone, creating a risk of social isolation – and making the surge of new
businesses and services targeting the elderly particularly timely.

Toshio Fushimi, 77, a former salaryman, said: “I live alone and I joined
this gym because I wanted to be able to communicate with more people.

“I’ve managed to get into better shape than I used to be with strength
training and I can go about my daily life without trouble. I’ve also made
friends coming here, I feel very secure here.”

Travel companies are similarly turning to the elderly market, with Kinki
Nippon Tourist and H.I.S. among major tour operators introducing Saga-style
packages aimed at the retired.

Meanwhile, the cosmetic company Fancl is to launch a new range of anti-ageing
products designed specifically for older customers.

The trend is likely to be followed in other countries with ageing populations,
including Britain and the United States.

Japan’s growth rate of over-60s over the past decade has been 28 per cent, the
highest among developed nations, with the US following closely behind at 27
per cent and the UK at 17 per cent, according to research by Datamonitor.

However, the same research shows that the rate at which the silver sector is
expected to grow over the coming five years is even higher in Britain than
in Japan – five per cent growth by 2016, compared to three per cent in Japan
– meaning that the UK’s own elderly citizens are also likely to demand
products and services aimed more specifically at them, from
mobility-assisting transport to easy-to-use packaging.

In the meantime, Japanese pensioners such as Mrs Kitazato are more than happy
to reap the benefits of their well-timed retirement years.

“Life for the retired today is very different from that of my parents’
generation,” she said. “I don’t stay at home. I come here and meet
friends and enjoy the footbath and also get my health checked at the same
time.

“The fact that I can come to these kind of places, despite being retired,
gives me a great enthusiasm for life in general.”

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