Can india’s senior citizens be an attractive customer segment
Can India’s Senior Citizens Be an AttractiveCustomer Segment?Half of India’s 1.2 billion citizens are less than 25 years of age, and this large youth population isviewed as a huge driver of economic growth and competitive advantage for the country.Now, a recent study by global real estate services firm Jones Lang LaSalle (JLL) has put thespotlight on the other end of the age spectrum: India’s senior citizens. The study notes thatcompared to the overall population, which is growing at 1.8% per annum, the population of thosewho are age 60 and older is growing at 3.8%. Their number — which currently stands at 100million — is expected to increase to 240 million by the year 2050. Further, with the rate ofgrowth in the senior populations of developing nations projected to be double that of developednations, India and China are expected to have almost 50% of the world’s 1.3 billion seniors by2040.Far from seeing this as a liability, the study highlights the potential that this group holds as aseparate segment that marketers and service providers can target.Take the housing needs of senior citizens. Traditionally, the elderly in India have stayed withtheir children. But over the years, nuclear families have increasingly become the norm. Also,because younger citizens are more likely today to move to other cities or countries in pursuit ofcareer opportunities, the notion of specialized homes for the elderly is gaining traction.In the U.S., this trend developed in the early 19th century, mainly through the interventions ofreligious groups and charitable bodies. Currently, there are around 2,000 senior housing projectswith more than 500,000 residents in the U.S. Worldwide, senior housing is estimated to be a $25billion industry.According to the JLL study, the market for senior citizen housing is now poised to take off inIndia: “A significant section of seniors today are independent, financially stable, well-travelled,socially connected, and as a result have well-developed thoughts of how they want to spend timeafter retirement.” The study adds that “unlike western countries where the senior living industryhas gained maturity, India provides an opportunity to developers, service providers, health careplayers and operators to create solutions specific to India while leveraging learning from acrossthe world.”It may not be all that easy, though. Satyajit Majumdar, professor at the School of Managementand Labor Studies at the Tata Institute of Social Sciences, says that looking at senior citizens inIndia as an independent market segment is tricky because of the affordability issue. “It is truethat the needs of senior citizens for housing, food, medical and so on are different. On the face ofit, it can be seen as a specialized market segment. But in the absence of strong health insuranceand social security measures, this will remain a very small segment.”
Majumdar notes that the earning capacity of people has not kept pace with longevity, and earningcitizens themselves have to face many economic hardships to lead a comfortable lifestyle. “Notmany senior citizens can independently afford the kind of lifestyle that they have when they staywith their children,” he says.When it comes to housing in particular, Majumdar points to the added issue of social stigma. InIndia, despite the advantages that specialized homes for senior citizens may provide, theycontinue to be derisively called “old-age homes” and are seen as being meant primarily for those“discarded” by their families. “We have yet not moved beyond this social thinking,” saysMajumdar.