Business And The Burgeoning Grey Pound

As the population gets older, business opportunities change and grow

The population of the UK is greying at an extraordinary pace, a phenomenon that is being experienced across the globe. The number of people aged 65 and over is expected to be over 16 million by 2035, an increase of over 40 per cent on the current number. By 2040, nearly one in four people in the UK (24.2 per cent) will be aged 65 or over

This demographic shift is notable for numerous reasons. Over 65s represent a significant proportion of the population, with unique needs, expectations and behaviours, and businesses need to be prepared to respond to these, or risk missing out on significant opportunities.

The Office of National Statistics (ONS) figures show retired household incomes have soared over the last few years, with insurer Prudential calculating that people retiring in 2018 expect an annual income of almost £20,000. This is a 10 per cent increase on the previous year, and also marks the first time young graduates’ incomes are eclipsed by those of retirees. The ‘grey pound’ is worth over £320bn a year, according to Saga.

Despite this, there is an overwhelming tendency for older people to be overlooked by mainstream businesses in numerous areas, from fashion and technology, through to holidays and transport. Many businesses fail to market to older customers or offer them a specialised service, neglecting their particular demands, and ultimately missing out on engaging with them as customers.

Specialising for older customers

Reaching out to this market doesn’t necessarily mean completely reorienting a business around older people to the detriment of the rest of your customer base. But it is worth reflecting on how you can offer specialised services for older customers, whether that’s within your current model, or by partnering with other businesses that do specialise.

The particular health concerns of the over 65s are especially relevant. It’s estimated 4 million older people in the UK have a limiting long-term illness – equivalent to 40 per cent of all people aged 65 and over – a number which will only increase as more people join this demographic.

Therefore, one of the biggest opportunities is related to meeting the housing needs of the grey market, covering a range of specialist accommodation, from sheltered housing to nursing care homes. A 2017 report in The Lancet estimates that if rates of care home dependency remain constant, there will be almost 190,000 more people aged 65 and over in the UK who need care by 2035: an increase of 86 per cent.

Partly driven by this increase in demand, investment firms are becoming increasingly active in the care home market. Britain’s biggest provider of care homes for the elderly, HC-One, is currently on sale for £1bn, and there appears to be a real appetite to invest in such healthcare assets. The UK’s first social housing real estate investment trust, Civitas, announced in June 2018 it has made £36.9m profit since launching in November 2016.

But care home organisations are also struggling financially, as they are receiving less income from local authorities who subsidise many care home places. Indeed, 148 care home businesses became insolvent in the last financial year, and the Local Government Association estimates the care home sector faces a £2.3bn funding gap by 2020.

Opportunities – care, leisure, companionship and tourism

While care homes certainly seem like a prudent long-term opportunity given the major demand, these current financial issues also call into question whether the traditional care home model is the best option. There appears to be an increasing desire, on the part of the social care system, as well as the individuals themselves, to stay in their own home, and receive care there.

Not all emerging business opportunities within the grey market are as serious as care needs. Beyond health-related concerns, there are also significant business opportunities in the leisure market. As a group with plenty of free time on their hands, and considerable disposable income, the over 65s are embracing fun, so there is substantial opportunity for growth in targeted activities that appeal to the older customer.

Romantic endeavours are one such area; the over 65s seem to be embracing online dating as enthusiastically as their millennial counterparts. Dating website eHarmony forecasts that by 2050 78 per cent of over-65 singletons could be using online dating services, and there are apps, such as Stitch, created specifically for the older dater.

The tourism industry is also benefiting from the grey market. Over-65s are among Britain’s top holidaymakers according to ABTA, the UK’s largest travel association. They are the age group most likely to travel alone, and 81 per cent of over 65s who did so said it was so they could do what they wanted on holiday. Tourism businesses can make the most of this by creating holiday experiences that suit older audiences, possibly taking into account health concerns that may affect how they travel.

In all of these opportunities, it’s vital to reflect on how to communicate with the older audience. Some businesses can fall into a trap of infantilising older customers, using ‘cute’ or oversimplified language, but they will not appreciate being patronised or condescended to. We have noticed that older customers do tend to appreciate clear, straightfoward messaging, whether it be in marketing, informative materials, on the phone or using online chat.

In all communication with older customers, it’s important to not automatically adopt a one-size-fits-all approach; there is a big difference between a 65-year-old and a 90-year-old, and each will have different preferred channels and messaging. Good market research will allow you to establish how and where you should be reaching different customers.

A particular consideration with an older audience is that some may have specific needs that will affect communication. For instance, in some cases, particularly if someone is living with dementia, their children will be closely involved in making decisions. Therefore, you will need to make sure you understand their children’s possible concerns, and address these in your messaging.


Older customers often expect an extremely high level of customer service, demanding polite, and fast, assistance. We make sure to respond to enquiries quickly – with around 90% of enquiries addressed within an hour – carefully select care workers with specialist skills, and reward them fairly, to make sure we provide the highest quality of care.

Technology is often a key component of how businesses interact with customers today, and while not assuming that older people don’t engage with technology at all, it’s important to bear in mind that most technology hasn’t been built with the needs of older people in mind. All companies need to make sure their technology adapts to older customers, rather than forcing them to adapt to technology.

Across all sectors of and in all business types, the opportunities presented by the burgeoning market of older customers and their spending power are significant. Given the clear trend towards the ageing of the population, it’s key that organisations and businesses don’t delay their efforts to support older people, but act. This is not only to attract and retain the custom of older audience because of the financial opportunities presented, but because we have a moral obligation to improve their access to products and services, giving them the choice they need and deserve.

Dr Mahiben Maruthappu is the CEO and co-founder of Cera, the tech-enabled homecare company.

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