“The new market is old age”

September 10, 2008

“Aging is today’s most profound socio-economic force shaping the future of business strategy and public policy.”

“The new market is old age.” That’s what Joseph F. Coughlin, director of the AgeLab at M.I.T. has to say. That quote, and a whole lot more information on senior shoppers, is to be found in an interesting International Herald Tribune article by Eric Taub.

According to Taub, seniors have lots of money, are living longer and don’t want to disconnect from younger generations by not being able to use modern technology. Accordingly, sharp companies are developing products to help “boomers maintain their own youthful self-images.”

Coughlin explains that: “"Baby boomers provide a perpetually youthful market’ and are looking for technology ‘to stay independent, engaged, well, and vital.’"

What I found to be particularly interesting in the article, and that has great application to those of us in the toy industry is the move by companies away from products that are designed for “older people” and towards products that cross generations.

It seems to me that if you create toys and games that:

Connect the generations you will have a winner.
Make older consumers feel smart you will have a winner.
Make seniors feel part of mainstream culture you will have a winner.

Check out the AgeLab website at http://web.mit.edu/agelab/. After all, seniors have money to spend and with older populations expanding and youth populations declining in parts of the world and in the United States going after the senior market may make you a real winner.

Posted by Richard Gottlieb on September 10, 2008 | Comments (3)

September 11, 2008

In response to: “The new market is old age”
Cliff Annicelli commented:

Case in point: Nintendo Wii. It's (most likely) the only video game system you'll find in retirement communities and nursing homes. (Extra credit question: Is Wii doing for bowling what Guitar Hero did for classic rock? If so, what are you doing to grab a piece of that potential action, U.S. toy business?)

September 11, 2008

In response to: “The new market is old age”
Richard commented:

I think your take on the video game business is spot on target. We as an industry would do well to emulate aspects of that industry as we seek to grow our existing child oriented business while expanding into the teen, adult and senior markets.

September 10, 2008

In response to: “The new market is old age”
Ronald Mannak commented:

Hi Richard, this is a very relevant subject. I think there is a lot to learn here from the video game industry. Often overlooked is the fact that the average video gamer is aged 29. And the average age is rising. It seems people who started playing video games as a child continue to play video games when the grow up. And, by the way, it turns out 45% of the video gamers is female. Video games are much more mainstream than one would think. Clearly, the video game industry knows something we (the toy industry) does not know. The key to successful products for cross generations might be to understand the success of the video game industry. Where the toy industry has all the characteristics of a commodity market (low prices, low margin, differentiation through marketing -- does this sound familiar?), the video game industry seems to compete on product innovation. It's Dell vs. Apple. (Never mind Dells sells more pc's, its market cap is $38B compared to Apple's $135B) The few toy companies that do compete on product innovation, like Ugobe and WowWee, have obtained pricing power traditional toy companies can only dream about. And Ugobe and WowWee have able to reach across generations with their products. I do believe their success in robotic toys can be duplicated in other toy categories. Ronald Mannak - 1uptoys