Senior consumers in Japan - statistics & facts
Young consumer groups are attractive to businesses in Japan, as they respond to trends and marketing through various channels. And yet, senior citizens aged 65 years and older should not be overlooked in Japan’s aging society, where they make up around 30 percent of the population. As a consumer segment with savings and the time for leisure activities after retirement, they offer markets a crucial opportunity. However, these silver consumers do not necessarily share the same shopping habits like their younger counterparts.
Nowadays, senior-led households are mostly debt-free and financially stable, with average net savings of multi-person households exceeding 20 million Japanese yen.
The consumption of elderly consumers will grow due to a proportionally larger population of people above 65 years in the short term, but this cannot compensate an overall decline caused by a shrinking population and low consumer confidence in the long term. Nonetheless, as a rapidly growing demographic group with disposable income, businesses cannot ignore the economic impact of senior consumers – neither in the present nor the future.
The current senior consumer generation
The current silver consumers were mostly born around the baby boom era and have benefitted from the stability of the traditional lifelong employment system in Japan. They experienced the heydays of Japan’s economic growth that culminated in heightened consumption activities during the asset price bubble in the 1990s, which has left a lasting preference for buying new and owning over borrowing.Nowadays, senior-led households are mostly debt-free and financially stable, with average net savings of multi-person households exceeding 20 million Japanese yen.
The challenges of online channels
Senior-headed households spent on average over 207 thousand yen monthly, with food being the largest expense item. Shopping activities are concentrated around physical retail, particularly stores in the neighborhood. Due to an increased feeling of insecurity when using the internet compared to younger cohorts, consumers aged over 65 are more likely to research shopping-related information in broadcast and print media. As such, B2C e-commerce services are facing a hurdle to reach out to the current group of silver consumers.Are senior consumers the “future consumer”?
The next groups of consumers joining the senior segment are known as the “lost generation”, an age cohort born in the 1970s that was most affected by the asset bubble burst and the ensuing economic stagnation. Along with Millennials, they grew up in the information age and are more responsive to online marketing. However, they are a fragmented group characterized by a high share of irregular employment that struggles with unfavorable saving conditions. With inflation in Japan exacerbating consumers’ financial worries, the risk of bankruptcy in old age will affect the spending habits of future senior consumers.The consumption of elderly consumers will grow due to a proportionally larger population of people above 65 years in the short term, but this cannot compensate an overall decline caused by a shrinking population and low consumer confidence in the long term. Nonetheless, as a rapidly growing demographic group with disposable income, businesses cannot ignore the economic impact of senior consumers – neither in the present nor the future.
