More inclusive retailers could cash in on a ‘longevity dividend’
Retailers urged by longevity experts to act now to tap into a market worth £half a trillion by 2040
The UK retail industry is currently at risk of missing out on a ‘longevity dividend’ valued at over half a trillion pounds by 2040 because not enough is being done to make shopping – both online and offline – attractive to us at every stage of our long lives. As a result, rates of spending among over-65s are not keeping up with the growth in the population.
The International Longevity Centre’s (ILC) “Shop ‘til you drop?” briefing published today, is the third in the series of briefings being released as part of work to develop a new “Longevity White Paper” supported by Aviva highlighting the solutions needed to capitalise on the opportunities of an ageing society.
ILC’s analysis finds that despite there being 1.7 million more people over 65 than a decade ago, spending by over 65s has only increased by 3.5%. Consumers aged 55 and over, who on average have 25 times the assets of individuals between the ages of 16 to 24, find themselves unable to spend their money as they want. This demographic holds significant untapped spending power, which remains under-exploited.
The ILC – which has launched a large-scale programme to help retailers tap into the opportunities of ageing – emphasises the need for a more inclusive retail environment. They argue for changes better to meet the needs of an increasingly diverse customer base, including parents with prams, individuals in wheelchairs, and both young and old alike. Eliminating existing barriers to spending could potentially boost GDP by 2% annually by 2040.
The ILC briefing highlights how people’s shopping patterns are changing, and challenges outdated assumptions and stereotypes:
- The latest ONS data on internet access shows that in 2020, nearly two-thirds (65%) of over-65s engaged in online shopping, an increase from 54% in the previous year.
- As of March 2023, 43% of 50 to 59-year-olds and 49% of 60 to 64-year-olds own an iPad (only just behind 30 to 39-year-olds at 52%)
- People over 65 are spending 25% more on alcohol, cigarettes, and narcotics than ten years ago while people under 50 are spending 40% less.
- In 2022, people over 65 spent 70% more on communication (including phone and internet packages) than they did in 2012
The ILC is calling for a shift towards sustainable and healthier consumption. In 2020, the UK’s greenhouse emissions from importing and consumption of goods and services were over five times higher than those from heating our homes.
David Sinclair, Chief Executive at the International Longevity Centre UK said:
“Retailers and other high street businesses need to do more to revitalise our town centres.
“This week we’ve heard calls for a Royal Commission to save the high street, but this will only work if we take account of the context of demographic change, making shopping environments welcoming for everyone right through our lives.
“Sometimes small changes are enough – clearer signage, offering access to a toilet, or just providing a seat or two can make a huge difference.
“Far from spending the kids’ inheritance, older people are underspending. Retailers need to help us spend in ways that are healthy, sustainable and fun.”
Ends
Media contacts
ILC – Press@ilcuk.org.uk or +44 (0) 7736 124 096. Spokespeople are available on request.
Notes
The ILC’s Retail Impact Fellow, Ailsa Forbes, has been working with retailers to support them in capitalising on the opportunities of ageing. Contact her via AilsaForbes@ilcuk.org.uk for examples of good practice.
The ILC, the UK’s leading authority on demographic change, has embarked on a programme of work to develop a new Longevity White Paper, identifying the changes we need to make to grasp the opportunities of population ageing, and longer lives. The development of our Longevity White Paper, which is supported by Aviva, will identify new evidence-based solutions for an ageing society.
This is the third in a series of thematic briefing papers setting out the issues of concern, sharing compelling new statistics, and inviting solutions.
You can send any comments or ideas for solutions to info@ilcuk.org.uk
Sources
In the UK, median household wealth is highest among over-55s, with individuals having an average of over £500,000 in total assets. This is 25 times higher than those aged 16 to 24 years, and the estimated aggregate annual savings made by those aged over 65 and retired in the UK equates to around £48.7bn – approximately 2.8% of GDP.
https://ilcuk.org.uk/tackling-barriers-to-spending-to-deliver-a-longevity-dividend/
Carbon footprint for the UK and England to 2020 – GOV.UK (www.gov.uk)
The ILC projected that spending by older consumers will rise from 54% (£319 billion) of total consumer spending in 2018 to 63% by 2040 (£550 billion). https://ilcuk.org.uk/maximising-the-longevity-dividend/
Office for National Statistics (ONS), Family spending workbook 1: detailed expenditure and trends. Release date: 31 May 2023. Family spending workbook 1: detailed expenditure and trends – Office for National Statistics (ons.gov.uk)
The ILC’s Retail Impact Project in conjunction with UK Research and Innovation (UKRI)’s Healthy Ageing Challenge and Stirling University – is working to transform how the retail sector sees and serves older consumers. For more information see www.healthyretail.org