Between the years 2000 and 2025 the number of people 60+ will have doubled at the international scale. Known as the “most lucrative market of the future” Baby Boomer numbers and shares of population, wealth, discretionary income and travel spending will continue to grow more quickly than any other generation.
Baby Boomers are likely to play a key role in COVID-19 recovery, as this generation is most likely to prioritize travel in the coming year. Recent data also demonstrates that Baby Boomers are the least budget conscious for accommodation and airfare. This purchasing behaviour aligns with market research conducted by the Cultural Traveler in the USA, which found that silver market travellers tend to generate the greatest return on investment for tourism destinations. In order to appeal to this market, tourism destinations need to understand the needs and desires of the older traveler and provide the services that appeal to them.
The Silver Market
The Silver Market, also known as the Mature or Seniors Market, is defined as people over the age of 50, or as seniors and aging “Baby Boomers‟ born between 1946 and 1965. Silver market tourists spend a greater percentage of their discretionary income on traveling than any other market segment, and have more time to travel. This segment can therefore help to increase visitor spend, occupancy rates (including off-season periods), and foster repeat visitation. About 31% expect to retire in the next 5 years at an average age of 64, and are seen to hold the key to the sustainability of the tourism industry globally.
Luckily, there is abundant research on the travel patterns of the silver market. In the USA, seniors comprise 47% of the leisure travel market, and are willing to travel in shoulder seasons if there is enough incentive provided. Research on this age group indicates that they are a largely untapped market, and it is growing at a phenomenal rate. In the USA, the next generation of retirees are predicted to be the healthiest, longest lived, best educated, and most affluent in American history; by 2030, one in five Americans will be 65 years or older, creating a situation that will affect social institutions and public policy for the next 50 years.
Tourism operators, booking sites, and national governments have started to pay greater attention to the preferences of Baby Boomers due to their influence in the travel market. In particular, the preferences for boomers include access to adequate medical facilities, excellent beaches and consistently warm weather, growing interest in multi-generational travel with family, and greater use of social media and online services for trip planning.
Tourism destinations and operators interested in capturing the silver market should focus on the development of niche activities and services that are most likely to appeal to seniors. In particular, Baby Boomers tend to enjoy holidays in destinations where they can meet people, focus on health and wellness, and encounter unique cultural experiences.
For example, health and wellness was found to be the number one priority for silver market consumers in most travel markets. The health-giving properties of outdoor activities, natural environments, spas, warm temperatures, and the availability of fresh, local foods all provide the necessary elements that promote a healthy lifestyle. A strong linkage with culinary tourism and retreats is therefore also feasible for this market demographic. COVID-19 has put an emphasis on mental health and quality of life, for this reason wellness tourism is expected to grow significantly over the next two years.
For snowbirds, the provision of appropriate and affordable accommodation for longer stays (i.e. self-catering units that are affordable for extended visits) will help to attract silver market visitors who travel to warmer climates for months at a time. This could also help to stimulate off-season demand and lessen seasonality cycles for many destinations.
Cultural attractions and heritage sites are of great interest to the silver market, with a particular focus on foreign language learning, cultural activities, and historical tours. Interest in local practices can be productive for inclusive economic growth as it is often more likely to reach local, remote, or indigenous communities. Tourism destinations should work to increase their capacity for cultural heritage tourism in an effort to create a robust experience for aging visitors.
Preferences for the silver market are often closely related to greater accessibility and convenience, and will require the development of specialized infrastructure and services for an aging population. Research on non-domestic travel suggests that about 7% of international travellers have some form of disability. Assessment of the economic contribution of travelling tourists with disabilities was compiled in the UK where it was found that overnight trips made by individuals with a health condition or impairment contributed almost £1bn to the English domestic visitor economy in the first 6 months of 2018, totaling 5.7 million domestic trips. This highlighted the importance of considering people with access needs who accounted for 12% of all overnight domestic trips in England . In the USA, adults with disabilities or reduced mobility currently spend an average of $13.6 billion a year on travel.
Aside from individuals with disabilities, the “baby boomer‟ generation is likely to retire with some level of reduced mobility. Unlike previous generations, this group is pursuing more adventurous vacation experiences in their senior years. As a result, accessible tourism has become an established niche area. The challenge then is to create accessible cruise ships, cruise terminals, ground transportation and tourist destinations. The design of tourism infrastructure should therefore take into account the characteristics of these mature visitors, such as hearing loss, diminished vision, lessened colour perception, poor memory, and weakened upper body strength. Hotel facilities for seniors can be designed or retrofitted to offset these difficulties, including better lighting, signage, ramps, and handrails. As well as accessible tours and experiences that disperse tourism dollars to diverse aspects of the local economy.
Baby Boomers will be essential to a COVID-19 recovery due to their large market segment and relative wealth. As tourism destinations and operators look towards the future of tourism, they should design a strategy that encompasses the preferences and requirements for this important demographic.
To learn more about the future of tourism check out emerging travel trends for 2021.