The population worldwide is aging. According to the UN, by 2050, one in six people in the world will be over the age of 65, up from one in 11 in 2019. Given that “aging” is a big and growing sector, it cannot be ignored by the software development industry. All efforts to address the aging economy and the needs of older people are called “Age-Tech.”
By analogy with “FinTech,” the term “Age-Tech” covers digital enablement of the longevity economy like FinTech shook up finance industry, including mobile payments, money transfers, loans, fundraising, asset management, etc.
“We can think of four categories of digital-enablement in Age-Tech: services purchased by older people; services purchased on behalf of older people; services traded between older and younger people; and services delivered to future older people,” says Dominic Endicott, venture capitalist and Age-Tech expert.
Whether it is a product aimed at increasing mental stimulation of our grannies or just an app to coordinate who of the family members will drive an older family member to a medical appointment, these experiences fall into the Age-Tech concept.
Emerging Age-Tech: current state of things
There are economic reasons for emerging the Age-Tech market at the moment. The report by the McKinsey Global Institute says the people over 60 will generate half of urban consumption growth between 2015 and 2030. According to Bank of America Merrill Lynch report, the spending of those aged 60 and over could have reached $15 trillion annually by 2020. While the longevity-related services are in their early years for many businesses, Bank of America Merrill Lynch launched a program to train its HR employees to better understand the needs of the aging clients and their families in 2015.
What is also important to make the longevity economy sustainable, is the efforts by the governments to manage the current demographic trends. The government of Japan, for example, serves as a pioneer on the way to the longevity revolution. In 2017, they established a Council for Designing 100-Year Life Society to ensure that older people have an opportunity to contribute to the society and embark on new lifestyles.
Some businesses have already shown their leadership in the Age-Tech market. GreatCall, a US connected health service provider, and Lyft, a US rideshare company, launched a transportation services project for older adults. By pressing “0” on their phones and telling the operator where they need to go, older customers can order the relevant transportation.
“While ride sharing services for this age group are often seen as a way to get to medical appointments, our customers use it for much more – staying connected with friends and family and participating in the activities they love,” said David Inns, CEO of GreatCall.
By the way, BestBuy, retail giant, purchased GreatCall to drive growth in its health business by expanding GreatCall’s devices and services, inter alia, through taking advantages of technology for 50 years old and over population.
“In health, we acquired a leading connected health services provider for aging consumers GreatCall and took a tangible step forward in our strategy to have seniors live longer in their homes with the help of technology,” Best Buy CEO Hubert Joly said. He added that “as children of aging parents, many of us would appreciate the potential power of our health monitoring service that enables seniors to live longer in their homes, while reducing related health care costs.”
Intel also makes efforts to enrich lives through the Age-Tech technologies. The company develops Internet of Things offerings for growing healthcare sector from fitness goals to surgical rehab faster, “more convenient, and at reduced costs”. Intel’s policy indicates that consumer engagement and payment for outcomes are crucial to meet the needs brought by shifts in demographics in the U.S.
The financial area of the Age-Tech market includes platforms for older people:
- to transfer wealth to their younger relatives tax-efficiently, with controls and performance-based incentives;
- a new form of insurance that periodically adjusts to user changes in risk profile;
- a social network focused on enabling those displaced by automation to pursue future paths with a high sense of purpose;
- new banking services solutions like Monzo, Startling or Revolut. Monzo partnered with PayPoint and allowed its older customers to deposit cash in person in about 30,000 shops in the UK. Startling did the same in partnership with the Post Office.
PensionBee, UK’s leading online pension provider, helps its older customers to manage their pension plan, and see their projected retirement income. Tomorrow says that its app offers a “rather difficult insurance process” in an extremely easy way. Tomorrow’s users can create their will in less than 20 minutes. With Ageless Innovations products, older people can take advantage of robotics technologies for comfort and companionship.
When it comes to the Age-Tech market leaders from the geographical perspective, at the moment, the majority of Age-Tech products come from the countries with aging societies. U.K. could become an epicenter of Age-Tech technologies in a very short time. U.S., Japan, Scandinavian countries are also coming up with a number of technologies for the “silver” economy.
Age-Tech: expectations and perspectives
Due to rapid digitalization adoption and the longevity economy growth, the Age-Tech market is well-positioned and expected to grow. Since the population is aging, the demand for products that can ensure over 50 years old people more comfortable and meaningful lives will also increase.
With more than 20 years expertise in software development, we are pretty sure that Age-Tech services need to be fine-tuned to the respective needs of the “silver” economy consumers. In the coming year, we’ll definitely see how technologies serve for the Age-Tech segment in a more intensive way. Artificial intelligence, virtual and augmented reality, robotics, cloud technologies, voice automation, Internet of Things, other technologies will enable safety and smart living for 50plus individuals.
What Age-Tech sectors will be on the rise in 2021? Apparently, we can mention healthcare, inter alia, remote health monitoring technologies, connected devices and wearables for older patients. Top Age-Tech industries in the future could also include communication, diverse financial services and mobility. Earlier, Age-Tech market map looked like:
- Social and Communication
- Cognitive Care
- Tech-Enabled Home Care
- End of Life Planning
- Retirement 2.0 (New – first appearance in 2020 Market Map)
- InsureTech (New – first appearance in 2020 Market Map)
- Healthcare Providers
- Home Care Providers
- Senior Living Communities
Given that the challenges older people face stay common the above-mentioned categories of the Age-Tech industry will retain their significance and relevance.
As a perspective, we would also predict that more successful Age-Tech companies will be likely acquired. After Great Call was acquired for $800 million by BestBuy and Amazon acquired Pillpack, an online pharmacy, for $1 billion, Age-Tech companies reap a cost-efficient dividend for technology market giants. Apple, Microsoft, Google and other are predicted to be very pro-active in this regard while Amazon is expected to be ahead in the Age-Tech market. The giants understand that massive digitalization will take place when the majority of older consumers adopt digital products. On the other hand, businesses like Amazon have diverse assets to turn them into the best solutions for the “silver” economy consumers. Existing Age-Tech companies could bring more personalization and tailored user experience patterns to them.
Instead of the Bottom Line
The longevity economy is apparently refocusing business goals and delivers new challenges. Understanding of “what is to age” is the next frontier for technology businesses. Removal of older people’s barriers and wrong perceptions of technology presents a huge opportunity for the Age-Tech market development that would be beneficial both for the industry, and the society.