The Business of Aging

Where to Live When We Get Old. Help!

The Wall Street Journal Sunday does a great job at covering a variety of "elder" care topics week to week. This week's topic was Woes of 'Continuing Care' Centers.

The article provides not so much a critique on CCRCs (continuing care residential community) but things to consider when researching them, determining if they are the right option for you (or your loved ones) and how to go about selecting one.

The same WSJ Sunday has another article (from their sister magazine SmartMoney) titled Picking a Nursing Home which gives some good advice on finding and evaluating nursing homes. 

We have many options on where to live as we age - right? (I'm not talking geography)

Well, sort of but not really. The big four include:

1. Stay in your house/condo/apartment and as your needs increase bring in hourly help for meal preparation, assistance with activities of daily living, companionship, etc.
2. CCRCs
3. Assisted Living
4. Nursing Homes

Other options include cohabitation (dad moves in with the kids) and the really interesting (and sometimes bizarre) trend of co-operative arrangements.

While I am a huge proponent of aging in place (at home) I am aware that this option may not be for everyone - by their choice or otherwise - e.g., it is not a realistic option when your caregiving needs become too much for one or even two people to manage (the final stages of Alzheimer's).

One problem I have with the senior care marketplace is how representatives from each housing option seem to market their products as if their option (i.e., assisted living) should be the ONLY option you consider. 

Selecting a "place" to age is complex. So many factors go into it - personalities, physical and mental health needs, family dynamics, money, etc.  And people usually transition from one option to another. They start out at home, move to assisted living and then maybe to a nursing home. Making these "where to live" choices requires a lot of thought, preparation and research and unfortunately a lot of families don't put enough effort into it - or are unable to.

This is why I see a growth in truly "independent" services that educate families and individuals on the various senior housing options and guide them through the evaluation and selection. A buyer broker if you will that has no ties to any particular option nor takes placement fees or commissions from chosen options.


The closest we have to this type of service today for the masses are employee benefits like work-life or EAPs but most individuals in the country do not have access to such services. Another option is geriatric care managers (probably the best option) but they are expensive (up to $100 an hour) and not everyone can afford them. Then you have the Administration on Aging which is wonderful but like many government agencies providing support to the public it is understaffed and quality of support is inconsistent.

Maybe a solution is a type of supplemental insurance product geared toward evaluating and selecting caregiving options as we age.

I don't know but I do know there is a huge business opportunity for anyone who can figure it out.

Now if we can just pay for it once we do make the decision - but that's another topic.

Disruptive Demographics: The Future of Retirement

I've been spending time this morning on Disruptive Demographics,  an online publication providing insights on the convergence of global aging and technology on business innovation and public policy.

Disruptive Demographics draws upon original research conducted at the Massachusetts Institute of Technology AgeLab, business cases, cross-national data, developments in technology, and lifestyle trends to present new thinking about old age.

In particular I wanted to share two audio interviews with Joseph Coughlin on the subject of disruptive demographics and the future of retirement – best characterized by the baby boomer’s new expectations for old age.

The next generation of retirees are more likely to demand the opportunity to remain engaged, productive, and to have the flexibility to work, care, learn and play in old age. What opportunities for business innovation do these expectations create? What personal and public challenges are ahead?

Listen to these excellent interviews with Joseph Coughlin - really interesting stuff.

Part 1. An Introduction to Disruptive Demographics 
Part 2. Envisioning Retirement Tomorrow  

Day Four - Aging in America 2010 & Boomer Summit

In my last post I focused on the first of two conference themes I observed: "As a company selling to seniors you will fail if you rely only on traditional marketing". This post focuses on how the he concept of "retirement" is going through a transformation.

What is retirement? And how is it changing.

The thought, let alone concept of retirement did not even really exist  in the pre-industrial agrarian era up to the mid 1800's. Prior to that people had no choice but to work until they physically or mentally could not. But since the industrial era people have increasingly treated retirement as if it was a right - it's considered a given. But all that is changing right in front of us. Not since the change from an agrarian to industrial economy has 'retirement' gone through this much transformation

This is big stuff. While we are not sure exactly what this change means a few things ere clear. When looking at the retirement that the parents of Boomers had versus what many Boomers will have:

Then: A hard stop. People quit worked at 65 and lived off their pension until death, maybe making a few trips per year if they were fortunate. 

Now: No stop. People will take on-and-off "gigs" until they are physically or mentally unable, and live highly active lifestyles until the end.

I realize this is a broad generalization but it makes the point.

It's almost as if we are returning to a modern day version of an agrarian society.  Not that our economy will become more agriculturally based but more in the sense that work is life, life is work. Some because they want to. Most because they have to.

Frankly, the age 65 'retirement' makes no sense with many people likely to live active and healthy lives well into their 90s.  Many Boomers will choose to work but more in the form of "gigs" than full-time employment. By gigs I mean not working as an "employee" for the same company year after year. And many people 55+ will become solo practitioners. The point is that Boomers will redefine what retirement is and the implications are enormous - as are the opportunities.

Some related articles:

- Economy pushes boomers to the brink -- retire or wait?

- Ten reasons why boomer start a business

Day Three - Aging in America 2010 & Boomer Summit

Today was our final day of exhibiting. Tomorrow we spend the day at the Boomer Summit.  As a marketing firm in this marketplace, three powerful themes resonated from this year's ASA event. I'll focus the two of those themes the next two blog posts. These themes include:

1. As a company selling to seniors you will fail if you rely only on traditional marketing.
2. The concept of "retirement" is going through a transformation.

Many sessions, workshops and hallway discussions were about the issues facing society as populations age. This is the third theme I took away from this event. While I will not focus on this theme in these blog posts, all of us in this space - vendors included - must never lose sight that this is the core of what these events are really all about.

Let's first look at theme #1 - As a company selling to seniors you will fail if you rely only on traditional marketing. Three points I want to make here. First, you need to be allocating a significant part of your budget to non-traditional internet marketing - SEO, SEM, PPC, etc.  A good model to follow is from our sister company HRmarketer - The Lead Generation model.

We were talking to one vendor who said his company didn't really need to worry about online marketing because their customers - the aging demographic - would rather hold a physical brochure in their hands and would be unlikely to go online to get information.

OK.

These were some statistics released last year by Pew Internet & American Life Project - they will only increase as Boomer's age.

•  74 percent use the Internet
•  62 percent have broadband at home
•  72 percent use a cell phone
•  43 percent connect to the Internet wirelessly.
•  91 percent of boomers use search engines
•  78 percent search in health care
•  30 percent use online ratings
•  38 percent share video feeds
•  26 percent read blogs
•  17 percent share creations
•  16 percent have a social network profile
•  7 percent blog.

Maybe this company's CURRENT target market isn't online (even that is debatable) but they will be soon. And if you delay building your online visibility it will be too late.  Just ask Porters of Racine.

Secondly, the messaging you used in your marketing last decade will not work with aging Boomers. Old people playing checkers and smiling will not sell your assisted living community. Many thought leaders have written about this topic including most notably David Wolfe in his book Ageless Marketing: Strategies for Reaching the Hearts and Minds of the New Customer Majority.

Finally, your marketing must account for the fact that most of the products and services relating to the care of an aging individual will not be purchased by the individual. As a result, you must also build brand awareness with numerous purchase "influencers" including the children of aging parents, doctors, nurses, pharmacists, care managers, in-home care companies, etc., etc. etc. This what our SeniorCareMarketer product is all about.  Even employers and human resource departments  may be involved.  

My next blog post will focus on the second theme I took away from the ASA event - The concept of "retirement" is going through a transformation.

55+ Demographic Post Highest Rate of Entrepreneurial Activity

Laura Lorber's article Older Entrepreneurs Target Peers in the Wall Street Journal's online edition discusses how Americans in the 55-to-64 age group have posted the highest rate of entrepreneurial activity - beating out youngsters just finishing college and even 30-somethings embarking on second careers.  This according to research by the Ewing Marion Kauffman Foundation.

Very interesting. I had no idea.

The article profiles Art Koff who founded RetiredBrains.com in 2003 after "retiring" from a 40 year career in recruitment-advertising communications. Mr. Koff figured that many of his age-group peers needed a diversion or some extra income, too. 

"I got up at the crack of dawn," Art says. "I can't imagine what would happen if I didn't have someplace to go and something to do."
 
The article discusses how many of these "older" entrepreneurs target their age group as customers - "inspired to create a product or service because they feel no one else understands or is interested in the older demographic".  

Linda Brown, age 65, is also profiled in the article. After losing her job in the insurance industry she started a business to help people with Medicare claims.  And then there is Jennifer Campbell, 56, who founded a memoir-writing service. Her typical clients are age 60 to 65. 

According to Art Koff, there are drawbacks to running a business in retirement - such as raising capital. According to Art,  "Banks don't like to lend to people in their middle 70s. They don't think they're going to be around that long. A lot of people will make assumptions until you spend some time with them." There's also the risk of losing one's retirement savings if the business does not work.  

Read Laura Lorber's article here. It's really great. Kudos to Laura for writing such a wonderful article on a really interesting topic - and to the Wall Street Journal for publishing it..

Staying Relevent With An Aging Population. An Elderhostel Case Study.

The blog 50-Plus Marketing (from consulting firm 20plus30) had a great post this week titled Elderhostel makes a fascinating marketing case study.

It is about how Elderhostel, a travel and educational organization for older adults, is trying to reverse a decreasing enrollment trend that has led to the organization losing millions of dollars this past year.

One problem is the age of their average customer has risen to 73 from 68 over the last ten years. In other words, through attrition alone they are on a downward spiral as they are losing relevance to the market they desperately need to sell product to - older Americans. And ironically, this is the fastest growing, largest and wealthiest demographic in the US. 

Not good.

So what are they doing?

A lot but the three biggest changes are:

1. A name change. They are now Exploritas.
2. Their top line messaging is now "Educational Travel in the U.S.A." with a tagline of "Adventures in Lifelong Learning".
3. They removed their age restrictions. No longer do you have to be at least 60, now anyone 21 or older will be able to participate.

I hope it works but removing the age restriction is a huge gamble.

I am in my forties but I am quite familiar with Elderhostel because my mom was a loyal customer up until her death last year. She loved Elderhostel! It was basically an educational vacation where you went to nice destinations and learned something by taking courses. She had a blast and enjoyed meeting new people.

But I'm not sure she would have enjoyed hanging out with 20 somethings - or even forty somethings. And vice versa. So this is a risky marketing strategy. In fact, I was surprised to see on Exploritas web site that in the section "Browse by' my choices were:

• Location
• Interest
• Date
• Activity Level
• Catalog
• Map

But not "age".

Interesting.

Anyway, I do hope their marketing strategy works because they have a great product.

Just about every business in the US needs to pay attention to this "case study" because:

1. If you don't currently include older American's in your target market you need to. The aging population is the largest, wealthiest and fastest market segment in the US. You can't grow your business by ignoring this demographic.
2. If your target market is limited to "older American's (like  Elderhostel's was) you need to realize that today's older consumers make buying decisions far different than yesterdays older consumers. Continuing to market today like you did yesterday will lead you down the same path as what Elderhostel has experienced. I'm not saying you need to do a 180 degree turn like Elderhostel did and include all age groups in your target market but you do need to repackage your products, branding and marketing to remain relevant to the Boomer market.

And that is the marketing case study all businesses will face the next several decades.

Interesting stuff - and a challenge all marketer's should love and embrace.

Boomers Putting Off Retirement: More Research.

We've blogged quite a bit about stories and research showing a significant number of aging Boomers are expected to delay retirement.

Today I read another report confirming this fact.

Researchers at the University of Michigan collected data from 4,412 older Americans in April and May of 2009. Those over the age of 51 were quizzed about career plans.

"We asked the same older workers what the chances were that they would still be working full time after age 65, and they went up from 47 percent to 57 percent between 2008 and 2009---a very rapid change after a long period of stability," said Michigan economist David Weir, director of the Health and Retirement Study. The chances of working past 62 went up from 60 percent to 65 percent.”

The focus of the research was on how older American's are weathering the financial crisis of the last year but regardless of their reasons, we are seeing more evidence of Boomers planning to remain in the workforce.

Go here to read about the research report, "Older Americans: How they are faring in the recession".

Recession Turns a Graying Office Grayer

The Pew Research Center just released a report titled "Recession Turns a Graying Office Grayer" and it is full of excellent information.

A big thanks to online marketing and social media expert Erin Read Ruddick from the firm Creating Results  who turned me on to this report. If you get a chance subscribe to Mature Marketing Matters,  the blog of Creating Results where Erin is a contributor. It's a great blog.

I'll summarize the research from Pew.

The American work force is graying because older adults are staying in the labor force longer, and younger adults are staying out of it longer. And this recession is accelerating this trend.
 
According to one government estimate, 93% of the growth in the U.S. labor force from 2006 to 2016 will be among workers ages 55 and older.

Yes the recession plays a role. According to the Pew Research, nearly four-in-ten adults who are working past the median retirement age of 62 say they have delayed their retirement because of the recession. Among workers ages 50 to 61, fully 63% say they might have to push back their expected retirement date because of current economic conditions.

What's interesting, as this blog has repeatedly pointed out, is that a major reason behind the aging workforce, beyond demographic and economic factors, is that older workers want to work (see image ).

Fifty four percent of workers ages 65 and older say the main reason they work is that they want to. Just 17% say the main reason is that they need the paycheck. Older adults are less inclined now than at any time since the 1960s to give up on the working life.

Older workers are also the happiest workers. Some 54% of workers ages 65 and older say they are "completely satisfied" with their job, compared with just 29% of workers ages 16 to 64.

Age is not the only demographic characteristic of the work force that's changing.

The labor force participation rate of women has essentially flattened out at 59%, about 13 percentage points below the current rate for men. Even in an era of growing gender parity in the workplace, the work/family trade-off continues to be much more complicated for women than for men. The Pew Research finds that nonworking women are nine times as likely as nonworking men to cite the tug of family responsibility as a key reason for not having a job. The survey also finds that only a small share of the public -- 12% -- thinks the ideal situation for a mother of young children is to work full time outside the home.

The impacts of these trends is enormous. We wrote about some in our HRmarketer blog post Will Boomers Retire or Keep Working: Two Opposing Views.

Read the Pew research - it is a fascinating read, especially for companies that provide "work life" or "family friendly" employee benefits.

A related Business Week article Reward Older Workers With What They Really Want  gives more insight into this trend and discusses how Boomers are poised to retire traditional notions of retirement:

"[aging workers] not only want their employers to recognize their enthusiasm; they expect them to support it by shelving outmoded shibboleths about where, when and how work gets done. Boomers overwhelmingly want modular work that is deeply flexible in terms of hours, location and even life stage...".

The Business Week article points out that aging Boomers are willing to accept a radically "remixed" set of non-monetary rewards to achieve it. They rate four other forms of compensation—a range of new experiences, a great team, challenging assignments and recognition for a job well done—as at least as important as money. 

This "rewards remix" is both challenging and liberating for talent managers. It's challenging because it means letting go of cash as the prime motivator and tangling with the difficult task of redesigning incentives to include more complex, holistic rewards.