the senior citizens and the residential world

Germersheim, 21. Oktober 2010

The senior citizens and the residential world: A growing consumer market

Club of the Economic Sponsors

German - French panel discussion

21st of October, 2010

Seite 2Germersheim, 21. Oktober 2010

The senior citizens and the residential world

Issues:

• How can one act profitably in the senior citizens' market?

• How can one adequately promote his products?

• What is the right strategy to develop products for the senior citizens? How can one become successful in the senior citizens' market?

• How can we sell senior citizens' products attractively?



Population declines on the long run

The growing group is "60plus"

Population development and age structure

Population in absolute numbers (Mio.) and age groups in percentage, Germany 1960 - 2050

Source: Statistisches Bundesamt; Prognosen: Deutsches Institut für Wirtschaftsforschung

1960 1970 1980 1990 2000 2010 2020 2030 2040 2050

30.2% 31.4%28.3%

23.1% 22.6% 21.3%18.7% 17.6% 16.4% 16.1%

52.4%48.6% 52.3% 56.5% 56.4% 56.3%

55.7%53.2%

48.3% 47.1%

17.4% 20.0% 19.4% 20.4% 21.0% 22.4% 25.6% 29.2% 35.3% 36.8%

under 20 years 20 to 60 years over 60 years

72.677.7 78.3 79.4

82.2 82.5 82.1 81.2 78.573.0



Consumption expenses until 2035

The consumption expenses of the generation "50plus" will increase by 11.5 % in the total expenditures till 2035.

Source: Studie "Wirtschaftsmotor Alter", Bundesministerium für Familie, Senioren, Frauen und Jugend, Juli 2007



Consumption shares of the total expenditures for household appliances and furniture (in percent)

Also in the furniture segment the portion of the buyers "50plus" will rise.

Source: Studie "Wirtschaftsmotor Alter", Bundesministerium für Familie, Senioren, Frauen und Jugend, Juli 2007

53,8 % 65 %

yearsyears

yearsyearsover



The one- and two-person households are increasing

5 persons and more4

per-sons

3 per-sons

2 per-sons

1 per-son

39,4 %

34,0 %

13,1 %

9,9 %

3,6 %

Split of private households in 2008 after size. Changes 2000 to 2008 in %.

-13.7

-9.7

-6.3

+7,2

+14,81-person households

2-person households

3-person households

4-person households

5(and more)-person households



The purchasing power is clearly higher in the economic centres



The older generation feels clearly younger

I feel

older

as old as I am

a little bit younger

much younger

in average years …

60 years+ 60 – 64 years 65 – 70 years 70 years+(total)



Consumer types

Price conscious domestic Quality conscious established Demanding epicures Critical actives Comfort-orientated individualists

Percentage 50plus

43 % 28 % 15 % 8 % 6 %

Average Age 63 years 70 years 61 years 69 years 56 years

Occupation 42 % retired 52 % retired 93 %

Gender m/f 49 %/51 % 39 %/61 % 50 %/50 % 39 %/61 % 53 %/47 %

Marital status 75 % in a partnership 47 % in a partnership 87 % in a partnership 48 % in a partnership 82 % in a partnership, partly with children

Residential form 45 % - own house 56 % - own house 64 % - own house 45 % - own house 70 % - own house

Criteria for the product choice

The price is the decisive factor for product choice. Set no great store by branded articles. Longevity and functionality of the products are important. Prefer rather robust and simple objects and attach no importance to unusual design and luxury objects. Technical affinity is relatively low.

Do not orientate themselves by fast-moving trends, are ready to pay an adequate price with well-known suppliers. For purchase decision, quality of the products is more important than the price. Branded products are associated with high-class quality. Technical affinity is low.

Technical affinity and fond of consumption. Setting high value on quality and demanding design. Look after high-quality materials and exclusive design. Modern, up-do-date products. Very brand-loyal, prepared to pay a premium for individuality, e.g. for customized products and services.

Looking for proven and established products but being clearly price-sensitive. Although less technically orientated, only little reservation against new technologies.

Technical affinity, demanding best quality when purchasing products. Associating branded products with high quality. First-class materials and exclusive design.

Requirements to services

Straight purchase process, prefer personal consultancy, confidence dominates the purchase decision, purchases via internet rather unusual.

Reliability and quality are important. a higher price is accepted, when good service and expert advise are assured.

Make use of product-related services such as assembly and maintenance.

Sound consultancy and explanation, also of technical details. Sufficient presence of friendly and competent sales staff, who dedicate their time, is a decisive purchase criteria.

Competent consultation, and quick delivery are extremely important.

Preferred purchase sphere

The shops where they are known and smaller shops.

Need of sales advisory service in a specialized shop, everyday commodities in superstores. Internet plays no role.

Prefer specialized shops, where they expect individual, competent consultancy, pay premium prices for high-quality products. Gain information via internet, but purchase generally on site.

To find the best offer, different suppliers are investigated and compared. Personal consultancy at the specialized shop is a reason to accept a slightly higher price.

Buying equally in the specialized shop, in retail stores and via internet. Purchasing expensive and personally important brand-products , the specialized shop is preferred against the retail store and the internet for its consultancy service.

Source: "Wirtschaftsfaktor Alter", Bundesministerium für Wirtschaft und Technologie, Bundesministerium für Familie, Senioren, Frauen und Jugend, Faktenblatt, April 2010



Essential requirements for the products

• barrier-free access to the furniture (German Institute for Standardization 18025)

• high environmental compatibility requirement (Blue Angels, FSC or PEFC)

• modern, but classical design

• bright decoration colours

• furniture which meet the personal needs

• comfortable operating functions, but no technical flourishes

• additional lighting



Essential requirements for the marketing

Marketing must be sophisticated, as people are different.

However, in general the following statements can be made:

- High requirement for personal consultation – buyers want facts and no "advertising clouds".

Purchase via specialized retailers with very well qualified staff.

- Internet plays no important role.

- The generation feels younger than it is and expects a "young and fresh" marketing approach.



Product examples

• Sensor lighting on the bed foot

• Double bed - movable

• Extensive lighting

• Electrically adjustable slatted frames

• Mattress appropriate for age with graded elasticity



Product examples• Sliding door ward robes for more movement

freedom

• Cushioning for sliding doors

• Stable handle bars made of metal or wood

• Lighting of the cupboard from the inside and outside

• Bright inside decoration

• Functional push boxes

• Swing-down rail



Product examples

• Drawers with self extract and full extract as well as damping

• Push and Pull closing – without handle

• Illuminated upper record possible



The most important rules in marketing

The perceived age is ten years below the biological age.

Physical restrictions must be considered.

An unequivocal address makes advertising messages plausible.

Information should be easily and quickly detectable and

without barriers.

Do not underestimate spiritual efficiency.

Advertisement should be also amusing.

Old people do not feel adequately represented in

the media.

Thank you very much!

Dr. Stefan SchwarzfischerNolte-Möbel GmbH & Co. KGKonrad-Nolte-Straße 2076726 Germersheimstefan.schwarzfischer@nolte-germersheim .de

the senior citizens and the residential world

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