An ageing but increasingly-wealthy and mobile Asian population represents a
boon for the travel sector, and one which is requiring a new focus from industry
service providers.
Abacus International President and CEO, Don Birch, says ‘grey travellers’ are
one of the fastest-growing segments for the travel industry globally, and in
Asia.
“We’re seeing the emergence of a new generation of older travellers who are
healthy, active, street-wise and have unprecedented spending power. This is a
lucrative segment but one which has specific needs,” he says.
While there is increasing understanding of the needs and preferences of this
segment, Mr Birch says there is still some way to go if the industry is to fully
tap and meet the expectations of grey travellers.
“Perceptions need to change so that we can adapt our services to meet the
needs of this market – one which is going to continue to grow in value and size
for at least the next 10 years.”
Latest research from Compete, Inc. Online travel comes of age travel study
estimates that baby boomers in the US (aged 45 to 60+ and tagged baby boomers
due to the number of births following the war) will earn an estimated US$3
trillion in annual income this year, and weld a discretionary spending power of
some US$800 billion.
Mr Birch says that Compete, Inc.’s forecast of baby boomers spending 40 per
cent more time holidaying and 74 per cent more money on a traditional vacation
than 18- to 34-year olds, creates a wealth of opportunities for the travel
industry.
“While Asia’s population maybe getting old, it will remain fit and healthy –
the 60 year olds will become the new active 40s,” he says.
“In recent years, the travel and tourism industry has made some good headway
compared with other industries and is now actively tailoring services to take a
bite of the senior traveller market.”
Increasing value in ageing population
Asia is not a young market. The number of senior citizens is increasing
significantly and this trend is expected to continue in the near future. By
2050, the proportion of people over 60 in industrialised countries is expected
to reach a third of the population, and 40 per cent in Japan (source: United
Nations Population Division 2000).
“While people may be ageing, they are becoming ‘younger’ too. More and more
seniors treat travel as a ‘natural thing’ to do, so they become a source of
increased demand. With the segment getting bigger and bigger, the travel and
tourism industry has responded to the signal and are beginning to cater to this
group,” said Mr Birch.
“To do that effectively, travel agents need to firstly understand the senior
citizens’ wants and needs. Only by knowing what they really want can the travel
agents craft special packages or rates, and be able to make the most of the
opportunity grey travellers present,” Mr Birch says.
Being creative and customer-focused are key to capturing the grey travel
dollar, he says.
Hertz offers specific promotions to select groups based on demographic
profiling. The company’s Managing Director, Asia & Japan, Mr Wong Soon Hwa says
senior travellers tend to be repeat customers as they are more discerning and
have higher spending power.
Retired travellers in the middle income bracket of US$30,000 to US$100,000
spent US$17.5 billion in 2004 – which is 16 times more than singles in the same
income group – and are projected to spend US$23.6 billion by 2014, MasterCard
Asia-Pacific research shows. Countries accounted for included Japan, South Korea,
China, Taiwan, Hong Kong SAR, Singapore, Malaysia, Indonesia, Thailand, the
Philippines, India, Australia and New Zealand.
Need for the personal touch
Grey travellers may be financially independent and adventurous, but they are
also hungry for attention and enjoy a personal touch, Mr Birch says. “They are
not afraid to spend as long as it is value for money and convenience which meets
their needs and concerns.”
“The bottom-line is they are the largest and most lucrative group of travel
related consumers. We ignore senior travellers at our peril,” says Mr Birch.
Packages and programs that include wine tasting, historical tours, movie
filming sites, healthcare packages and celebrity elements have all become
popular new offerings from the travel industry.
Chan Brothers Travel markets customised tour packages targeted at this age
group for cultural enrichment and special events.
“We notice that a majority of baby boomers tend to shy away from the regular
organised tours. They want to explore on their own or with friends who have
similar interests. Hence we have special interest packages to make help them
make their vacations a relaxing and memorable one,” said Mr Chong Meng Kee,
Director, Chan Brothers Travel.
Abacus International President and CEO, Don Birch, says travel service
providers therefore should diversify and target according to mind-set and life
stage, but definitely not age.
According to global research company ACNielsen’s Life Jugglers and Life
Surfers collaborative consumer study, baby boomers have higher average personal
and household incomes and are spending more on almost everything, from phones
and mobiles to groceries, financial services, travel and tourism and even
technology and the Internet.
CONTACT
Linda Koh
Manager, Marketing Services
Phone: (65) 6426 0616
ORGANIZATION
Abacus
International Pte Ltd
http://www.abacus.com.sg
#08-01 Abacus Plaza | 3 Tampines Central 1
Singapore, 529540
Singapore
Phone: +65 6426 0066
Fax: +65 6426 0088
Email:
marcoms@abacus.com.sg
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globalagingtimes.com accepts no responsibility for their accuracy.
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