Retailers brace for ‘Silver Tsunami,’ embracing senior shoppers

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With the emerging “Silver Tsunami,” a metaphor for our aging population, retailers are preparing for the tidal wave of some 78 million Baby Boomers turning 65 and over in the next 10 to 20 years

With their growing numbers and vast purchasing power, senior shoppers present both an opportunity and challenge for retailers. For some of the biggest names in the industry, including Kohl’s, Best Buy and Boscov’s, the 60-and-over crowd represents an important customer base already, and they are doing even more to accommodate them.

“This demographic should be important to retailers as there is a gap between the scale of the senior consumer population’s purchasing power and the current offerings in the retail sector that are more geared toward younger shoppers,” said Deborah L. Weinswig, Managing Director at Fung Global Retail and Technology in New York.

She said the senior proportion in the U.S. was a substantial 14.8 percent, or nearly 48 million people in 2015, and projected to grow to 20.7 percent of the total 356 million population by 2020. Likewise, spending by U.S. seniors continues to grow faster than consumer spending in total,

Senior households wielded $1.43 billion in spending power last year — up 6.7 percent from $1.34 billion in 2015, according to National Consumer Expenditure Surveys. The mean family wealth and before-tax real income of households headed by most age groups under 64 contracted considerably between 2001 and 2013, while households headed by seniors saw a significant increase in their average wealth and income in the same period.

On the consumer spending front, U.S. households consisting of those ages 65-74 direct a substantially greater share of their total spending to retail categories than the average household does, but households consisting of those ages 75 and older direct a lower share than average toward retail.

Fung researcher Swarooprani Muralidhar said seniors bought twice as many household supplies, cleaning products, books and periodicals, than they did clothing (142 percent vs. 62 percent of their average household total spending in 2016.)

Senior couple Phil and Karin Damiani of Media, Delaware County, are loyal Boscov’s customers. While Phil Damiani, 67, likes perusing the Boscov’s at the renamed Promenade at Granite Run Mall, Karin, 64, does 90 percent of her shopping at Boscovs.com.

The couple made a rare shopping excursion together at the Boscov’s store last week so Karin could check out new frames for her glasses in the optical center. They also looked at furniture and appliances.

Phil Damiani said he appreciates attentive customer service above all else.

Weinswig at Fung said online shopping was growing among seniors, like Karin Damiani, because the convenience it provides through home delivery as more seniors opt to stop driving.