By 2050, there will 587 million elderly people who will make up one third of the country’s population. The silver generation economy is full of potential and ready to boom
China is aging and a new potential group of consumers are ready to boom: the silver generation. According to data from the National Bureau of Statistics, by the end of 2018, China’s population aged 60 and above was 249.49 million, accounting for 17.9% of the total population, including 166.58 million above the age of 65, or 11.9% of the total population. Moreover, between 2014 and 2050 the consumption potential of China’s old-aged population will increase from 4,000 billion to 106,000 billion RMB and its percentage of GDP will increase to 33%.
China is the most connected country in the world. Today the popularization of the mobile internet, social networks, online shopping and mobile payments are no longer exclusively the reserved of only the young. The digitalization embraced elder people too. According to QuestMobile, the average use of mobile internet in the silver generation increased from 98 hours in 2017 to 118 hours in 2018, an increase of 20.7%. Furthermore, elder people spend nearly four hours per day online.
© UOOYAA 2019SS. China’s fashion brand UOOYAA invited elderly Chinese to model for its SS19 collection at its debut at the London Fashion Week in February.
Most of this silver generation are using apps for social networking, entertainment, news and information. Of note, the active penetration rate of real-time communication platforms has reached 84.5% while, on average, members of the silver generation spend 42.6 hours every month communicating via apps.
WeChat has become an important platform for the silver generation to express their feelings as well as maintain social relationships. The numbers of this demographic who use WeChat is increasing by the day. In 2016, the number of active users aged 55 and above was only 7.68 million, but by 2018 this number had shot up to 63 million.
By 2050, there will 587 million elderly people who will make up one third of the country’s population.
The number of those in the silver generation who use the internet is increasing daily. The demand for entertainment is also getting stronger, with the popularity of short video clips in recent years having emerged as a newfoundland for the silver generation.
On short video sharing apps such as Douyin (international version TikTok) or Kuaishou (international version Kwai), a group of middle-aged and elderly online celebrities have emerged. The strong characters and constantly witty remarks of stars such as You Benchang, Grandpa Jigong, Aunty Luo and Second Brother of Erlong Lake are a fun and fresh change from the younger online icons. Many members of the silver generation can feel a strong sense of belonging on these apps. And now e-commerce is trying to reach this new wave of buyers.
© Instagram. Natasha Lau poses with her mother Lisa Xia, proving that fashion has no age limit and that members of the oldest generation can also be trendy.
For example last year Alibaba launched “Taobao for elders” during Chinese New Year holidays. According to Alibaba’s latest figures, over 30 million Taobao users are over 50, with over 75 percent falling in the 50-59 range, and nearly 20 percent aged 60-69. Over 1,000 livestream shows aimed towards this consumer group are broadcast on Taobao daily. The he so-called Silver consumers from first- and second-tier cities have the most spending power, and the report said that health supplements was the top category by Silver consumers accounting for about 30% of their cross-border shopping on the site in 2018.
This silver economy is turning into the newest hardcore spending force, thanks to the power of internet.
Foreign brands should then pay attention to this group. In the past, the most popular cross-border e-commerce goods among this group were healthcare products. Now pet products, household digital appliances and beauty and cosmetic products are more popular. Moreover, since taking into account the hobbies and interests of the silver generation, more and more business opportunities are emerging.
Square dancing is a very popular offline activity among middle-aged and elderly Chinese, incorporating mingling in a social environment together with physical exercise. According to the estimate by square dance startup Darfoo in its Industry Report of China’s Square Dance Industry, in 2015, nationally, the number of square dancers was approximately 80 to 100 million. The huge numbers of square dancers drew the intense attention of the market.
© CGTN. Wang Deshun. The 80-year-old model and artist represents Chinese older fashionistas, reshaping China’s views on aging.
So today, Chinese Generation Z or Gen-Z is closer to the elders than ever. Although the two generations were raised quite differently, young Chinese are rediscovering tradition and they now share not only values but also fashion with their grandparents. Indeed, never before have China’s elderly population had such a high interest in fashion and lifestyle. And while Chinese are growing older, this generation is gaining more and more importance, especially for what concerns sales.
Seniors will be responsible for 150% growth in consumption in each regional market in the next 2-3 years.
A study by research firm OC&C Strategy Consultants revealed China’s Generation Z – those born between 1995 and 2002 – accounts for 15% of their household’s spending. However, although the youngest netizens spend the most, the elderly population is about to exceed 255 million people by 2020.
Moreover, WeChat has revealed that its users between the ages of 55-70 grew from around 8 million to over 50 million during 2017, with over-60s using 80% of their cell data on WeChat as opposed to just 6.8% by the 18 to 35-year-old generation. Therefore, the Dragon’s major companies started to organize in order to attract this new audience.
With the emerging of this so-called “silver-economy”, Alibaba has begun hiring older consultants to improve its digital services for elderly people and other tech companies are launching startups entirely addressed to this generation. An example is the successful app Tangdou, which focuses on connecting middle-aged women who like to dance in public squares with other like-minded people. The silver generation economy is full of potential and ready to boom. On top of this gold mine, it is likely we will witness the birth of at least a few unicorns with valuations in the hundreds of billions of dollars.
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