When I encourage businesses to take account of an ageing population to boost their success, I’m not talking about getting rich quick from a captive audience.
What I believe businesses in any area should be doing is understanding the changing marketplace and making adjustments accordingly.
Take going online. There are around 4.5 million over-65s in the UK who are not online. Why? They may not have the skills, they’re very rightly worried about security, or they may struggle with the dexterity, vision or memory that makes online shopping, banking or using any services difficult. Or, like my dad, they may simply refuse to go any further than an electric typewriter.
So financial institutions, retailers, utilities and more can go one of three ways. They can ignore the changes in the shape of their market. They can take an opportunity (as many are already doing) to make more money by charging more for offline transactions and argue that they are simply covering costs.
Or they can take a hard look at how they interact with their market and make adjustments to win more share through a better experience for all. It’s a losing strategy to assume that everyone of any importance has a mobile phone and a Facebook account, or is even internet-enabled. More worthwhile is to think about which channels work best for different segments of the population. Which messages are most relevant to this growing older audience? How can you demonstrate that you are a credible provider while protecting your customers from those who seek to steal and destroy?
We’re always talking about the customer experience and how customers expect the best. Older people deserve the best too, and that’s a long-term strategy for businesses who want to stay around and build their reputation wisely.
Sale house concept
The news that Nationwide is raising its upper age limit so that 60-year-olds can take out 25-year mortgages is an interesting one. Many of the other leading providers such as Halifax, Santander, HBSC and Barclays now have upper limits that mean people can extend their mortgages into their 70s and even 80s. Of course they come with many provisos. Some say it’s on a case-by-case basis, or only for a certain percentage of the price, or only for current customers.
The overall theme though is that mortgage lenders are recognising that people are living and working for longer, so in a better position to keep up payments on a mortgage further into life. It’s also realistic thinking in the face of ever-increasing house prices.
Why would people in their 60s want to take out a new mortgage? It could be that they want to move to a more desirable part of the country. Homes in the Cotswolds don’t come cheaply anymore. Or they could be moving into the increasingly popular retirement apartment blocks or villages that offer a comfortable, sociable and well-maintained lifestyle, but may only be downsizing in the sense of space rather than cost.
It could also mean that asset-rich older people are taking equity out of their property to spend on themselves or use to help their families. According to Dominik Lipnicki of Your Mortgage Decisions Ltd, quoted in The Telegraph, the move is likely to boost the number of pensioners increasing borrowing to pass on deposits to their children.
Creating excitement about a proposition, putting a time limit on making a purchase decision, invoking trusted sources.
These are recognisable strategies that are often used to encourage potential customers to buy, and buy fast.
Whether you like them or not, they are often employed by genuine businesses to get people off the “I’m not sure” fence and buying.
Now, though, it seems financial fraudsters are using the same methods to victimise older people.
A new report from Stanford University has found that scammers are using “high-arousal” emotions such as anger or excitement to encourage people to make risky purchases. And older people seem to be more vulnerable to this approach than younger people.
Even though they may recognise that an appeal may not be credible, older people are still more likely to make that decision to buy if their emotions have been heightened than if they are in a more “low-arousal” state of being bored, depressed or tired..
This puts a new perspective on how we sell to this age group.
You could argue that if the research is valid, it’s a perfectly feasible approach to selling real goods and services to older people. But if fraudsters are busy perfecting the art, should we be taking the moral high ground and refusing to get involved?