For many New Zealand businesses and marketers, age is wonderfully convenient.
You can open a database, select everyone aged 60 or over, give the group a name such as "seniors" or "Baby Boomers", and start planning a campaign. You might differentiate by city or region, like Auckland or Canterbury, but that's it (for many anyway).
The problem is that two people who are both 68 may have considerably less in common than their date of birth suggests.
One may still be working, travelling overseas several times a year, training at the gym and helping adult children into their first homes. Another may have a chronic health condition, be living alone and increasingly depend on family for transport and everyday tasks.
They're the same age, although from a marketing perspective they're very different people.
Recent research from Harvard Business School makes a strong case that businesses need to rethink the way they segment older consumers.
Professors Elie Ofek and Barak Libai argue that chronological age remains the most common way of defining the older market, even though there's growing recognition that it does a poor job of capturing the differences within it. Older consumers can vary substantially in their physical and cognitive health, wealth, interests, needs and response to marketing.
That becomes increasingly important as people live longer.
Global life expectancy increased from 64.9 years in 1995 to 73.3 in 2024, according to research cited in the Harvard paper, with a further 4.1 years projected over the following three decades. Importantly, much of that additional longevity is expected to occur beyond 65, and many of those additional years are healthy ones.
For marketers, that means the distance between a healthy 60 year old and a dependent 90 year old can encompass three decades of vastly different experiences, capabilities and needs.
Yet both can end up in the same "older consumer" segment.
A different way of looking at age
The Harvard researchers suggest several alternatives.
Biological age considers how well someone's body functions rather than how many birthdays they've had. Psychological age considers how somebody feels, thinks and behaves. Social age reflects circumstances and social roles.
Another approach looks at life events, including pre retirement, active retirement, slowing down and dependency.
Perhaps the most useful model for marketers combines health with lifestyle and social activity.
It produces four quite different consumers.
A healthy indulger remains physically well, socially engaged, active and adventurous.
An ailing outgoer may have health problems but remains socially active and wants to continue participating in life.
A healthy hermit is physically capable but considerably less socially engaged.
A frail recluse has poorer health alongside relatively low social activity.
Consider what that means for something as simple as travel.
A healthy indulger in their seventies might be considering a cycling holiday through Europe. An ailing outgoer of exactly the same age may still want to travel, although accessibility, medical support and the physical demands of the trip become part of the decision.
Chronological age hasn't told the travel company much about either customer.
Their circumstances have.
Healthy ageing changes the commercial picture
This distinction also challenges the persistent tendency to associate later life primarily with decline.
The Harvard paper identifies a large group of "healthy agers" who remain independent and continue consuming goods and services in ways that more closely resemble their younger selves than dependent older consumers. The researchers argue that grouping these consumers with dependent older people and approaching both through stereotypes associated with poor health is a common marketing mistake.
There's considerable commercial weight behind that observation.
In the United States, people aged 65 and over accounted for 14 per cent of consumer spending in 2005, the lowest share among the adult age groups examined. By 2022, their share had reached 22 per cent, making them the largest. Together, the 55 to 64 and 65 plus groups accounted for 43 per cent of consumer spending.
The lesson isn't simply that businesses should spend more money marketing to older people.
It's that they need to understand which older people they're trying to reach.
Start with the person, rather than the birthday
None of this means age has no value. A 62 year old and an 82 year old are statistically likely to differ in ways that matter to a marketer.
It does mean that age should probably be the beginning of segmentation rather than the end of it.
For a retirement village, financial adviser, health provider, travel company or technology business, the more useful questions might include how independently someone lives, how socially connected they are, whether they're still working, what their health allows them to do, what they're trying to preserve or achieve, and how they see themselves.
That produces a much more useful picture than "60 plus".
It also requires businesses to resist a habit that marketing has relied on for decades: assuming that people born within a particular period constitute a consumer segment.
Baby Boomers aren't a segment in any meaningful behavioural sense. They're a generation containing millions of different people whose lives have diverged considerably over the past six decades.
As Generation X begins moving into its sixties, that distinction will become harder to ignore.
The opportunity for businesses isn't simply to get better at marketing to older consumers.
It's to get better at understanding them.
