25 January 2001
By Darren Allen
Long ignored by traditional retailers and the online community, senior
citizens are rapidly becoming the second-largest untapped customer base, after
minorities.
There are 58.7 million people aged 55 or over in the US today, and their
numbers will rise to 63.2 million by 2003. Americans aged 55 and older comprise
21% of the entire US population and 29% of all adults 18+. They also control
almost half of all after-tax income.
Despite the stories about grandma and grandpa's fear of computers, most
online seniors are very comfortable with being on the web. Though online seniors
are proportionately underrepresented as a group, their numbers continue to grow
steadily.
Seniors Online
In 1999, more than 12 million seniors, or 21% of all Americans aged 55+ were
active internet users. This compares with a penetration rate of 28.7% among all
adults aged 18+. But by 2002, the number of seniors online will total 25
million, accounting for 40% of all seniors (but still under the penetration rate
of 50% for all adults 18+).
While the media hype concerning seniors being the fastest-growing segment
online is true, a primary reason is the group's relative slowness in getting
wired. Growth is higher when you are starting from a smaller base.
Seniors account for 21% of total adults online in the US today, but by 2003,
they will comprise 23% of all wired adults 18+.
Seniors and eCommerce
Seniors who use the internet spend more time and money on the web. In 1999,
the propensity for online seniors to purchase over the web was 62%, as compared
with 58% for all internet users (aged 14+). By the year 2003, 78% of online
seniors will have purchased over the web.
The top five items recently purchased by seniors are computer software,
books, computer hardware, CD's and clothing, according to Greenfield Online.
Almost a third of seniors have made a purchase from online drug stores, mainly
buying over-the-counter items. Despite their increased need for medication, only
9% of seniors have bought prescription drugs online.
More than 40% of Greenfield Online survey respondents, or 500 seniors, had
household incomes of $50,000 or above.
In 1999, seniors accounted for 21% of total e-commerce spending in the US, or
$4.0 billion. By 2003, their share of the e-commerce pie will rise to over 32%
or $33.5 billion.
Darren Allen is a senior analyst at eMarketer. He is the
author of the eMarketer eCommerce:
B2C Report. eMail him at dallen@emarketer.com
with comments, suggestions, and questions.
