||Baby Boomers: A Burgeoning Customer Market
Aging Americans are leading increasingly active lifestyles, whether seeking out exercise for health improvement or social activities for pure enjoyment. This group is dominated by the baby-boomer generation, which is made up of Americans born from 1946 to 1964.
Many Americans have been delaying their retirement, and this trend is expected to prevail in the next two decades. With many baby boomers striving for the fountain of youth, this active generation will demand a specific type of retirement, different from that of older generations.
Due to the generation's size and wide variety of interests, baby boomers' desires to offset the aging process has created opportunities for lenders, investors, entrepreneurs and others in a wide variety of industries, from online dating to motorcycle manufacturing.
Back in the dating game
According to US Census data, 31.3% of adults aged 50 to 64 are widowed, divorced or never married, making active baby boomers a prime market for the Dating Services industry. In fact, baby boomers comprise one of the fastest-growing demographics in the $2.1-billion dollar industry.
Additionally, with a growing number of baby boomers surfing the net, inspiring the nickname "silver surfers," online dating has become more accepted among this age group. For example, sites like OurTime -- the largest dating site specifically targeting baby boomers -- 55 Alive, Senior Friend Finder, Silver Singles and Executive Senior Dating are all catering to single baby boomers who are increasingly logging online.
Industry demand is forecast to continue expanding as a rising number of singles in this age group embrace the Internet, particularly as a method for forming relationships. To capitalize on this market, online dating service companies will continue to create niche dating networks and services catered to single baby boomers. As a result, the Dating Services industry is expected to grow at an average annual rate of 3.5% to $2.7 billion in the five years to 2018.
Hitting the gym
Also drawing attention from baby boomers is the Gym, Health and Fitness Clubs industry. According to the International Health, Racquet and Sportsclub Association, the number of older adults hitting the gym and health clubs has been growing at a record rate. People aged 55 and older now represent nearly 25.0% of all health club members.
Over the next five years and beyond, population growth and demographic changes will significantly influence industry revenue, especially as people aged 55 and older increasingly pursue more active lifestyles and focus on physical appearance and weight.
By 2014 in particular, the retiring baby-boomer generation will likely create strong opportunities for gyms and health and fitness clubs that focus on this massive potential market segment. With more service offerings geared toward this age group, such as water aerobics and exercise classes, a greater number of baby boomers will flock toward the industry.
Also, as baby boomers age beyond their 50s, healthcare costs will rise, creating incentives for insurers to promote preventative practices like fitness participation. As such, the next five years will mark a shift from disease treatment to disease prevention and health promotion by encouraging people to monitor their health, exercise and eat healthy. The active baby-boomer market will help contribute to the Gym, Health and Fitness Clubs industry's average annual revenue increase of 2.9% to $29.9 billion in the five years to 2018.
On the road again
In pursuit of their social and active lifestyles, an increasing number of baby boomers have bought RVs. In fact, retired baby boomers make up a dominant share of RV owners, keeping demand strong for the Truck, Trailer and Motor Home Manufacturing industry and the Recreational Vehicle Dealers industry. Thanks to the support from baby boomers, these industries are expected to grow at average annual rates of 5.3% and 2.6%, respectively, in the five years to 2018.
Retirees frequently sell their homes to travel domestically, and RVs allow them to travel in comfort at their own pace and leisure. The baby-boomer generation is generally wealthier and lives longer than any prior generation, making its members prime targets for an RV lifestyle. One-tenth of vehicle owners in this age group also own an RV, according to the Recreational Vehicle Industry Association. In line with a rising number of RVs and motor homes on the road, demand at properties in the Campgrounds and RV Parks is expected to rise as well. As such, IBISWorld projects industry revenue to grow at an average annual rate of 1.9% over the five years to 2018.
Because baby boomers have high levels of disposable income and leisure time, they also represent an attractive customer market for motorcycles and boats. These purchases may be lifelong goals, and retiring baby boomers now have the time and money for motorcycles and boats. The freedom and social aspects of riding a motorcycle or going boating have encouraged many baby boomers to join motorcycle clubs and yacht clubs. Due in part to strong demand from the mature market, revenue for the Motorcycle, Bike and Parts Manufacturing industry is expected to grow at an average annual rate of 0.9% in the next five years. Similarly, the Boat Building (33661b) and the Boat Dealership and Repair industry are expected to grow at annualized rates of 6.7% and 3.0%, respectively.
Restless in residence
In the coming years, active baby boomers will command a new kind of retirement living, one that is vastly different from that of their parents. For many seniors, retirement and assisted-living communities are considered a refuge of last resort. So in an effort to counteract this perception, operators in the Retirement Communities industry are offering more modern and feature-full residences with new architectural designs and technological advancements.
Operators will implement more home-like designs into their facilities that will implement better and more creative use of light, sound, water and greenery to enhance socialization areas. And more living spaces will have instant voice and visual access to family and friends, and facilities will feature access to a wider variety of medical sources, ranging from physicians to nutritionists.
These new retirement communities provide active, engaging, vibrant and intellectually stimulating environments to better appeal to increasingly social and active seniors, a group that often continues working, volunteering and participating in a variety of educational and health and wellness programs. Among other amenities, retirement community residents can enjoy swimming, playing tennis, jogging, biking and boating. Communities may also have fitness centers, hair salons and markets. In the five years to 2018, the Retirement Communities industry's revenue is forecast to increase at an average annual rate of 5.4% to $69.8 billion.
Honing their craftsmanship
Increased leisure time as baby boomers enter retirement makes home-improvement and do-it-yourself (DIY) projects popular endeavors among this group, especially those who want to downsize. As these long-time homeowners move into new homes or update existing homes, they will increasingly participate in home-improvement and DIY activities.
Despite the housing bubble burst, annual home improvement expenditures have increased on average since 2008, with related expenditures by baby boomers growing at a faster rate than those of younger homeowners. In fact, while spending on home improvement projects by people younger than 55 has increased moderately over the past decade, spending by those aged 55 and older has nearly doubled, according to the American Housing Surveys.
Given their greater longevity and higher incomes, the baby-boomer generation will seek to improve their homes for comfortable and safe aging, helping bolster demand for the Home Improvement Stores industry. IBISWorld projects industry revenue will grow at an annualized rate of 3.1% to $191.5 billion over the five years to 2018.
In addition to being handy around the house, baby boomers often engage in a variety of hobbies and crafts, such as gardening, canning and sewing. In the Fabric, Craft & Sewing Supplies industry in particular, women aged 45 and older make up about 52.0% of the customer base. This share is attributed to the large population of baby boomers who participate in sewing and crafting activities in their leisure time; finished goods are often given as gifts or used as home decorations.
The 78 million-person strong baby-boomer generation is working hard to counteract the aging process by remaining vigorous and engaged in various social and physical activities. They are living longer and have more accumulated wealth than any previous generation, characteristics that are helping them redefine retirement living in ways that are very different from their parents.
(Source: IBISWorld, 04/08/13)
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