Facing this price-sensitive and cautious consumer group, how can finance break through?
Editor’s note: This article from the micro-channel public number “a FINANCE” (ID: yibencaijing) , of: Euler.
In recent years, Internet users no longer increase rapidly, and the demographic dividend is disappearing.
So, some entrepreneurs began to target new groups that had not been tapped in the past.
The elderly group has become a key target.
About 2015, a large number of APPs related to elderly users appeared, including entertainment and functional ones.
In addition, there are e-commerce and educational institutions specifically targeting the elderly.
But monetization is often a problem for them—the elderly are price-sensitive, have low willingness to pay, and are cautious about consumption, making it difficult to pry.
So, after trying the mall, travel, courses, advertising and other modes, players began to try financial monetization.
For the financial realization of the elderly users, it is like taking the chest out of the fire, doing well, and maybe easily profitable; if it goes wrong, it may be an abyss…
01 Silver Hair Economy
Data from the National Bureau of Statistics show that as of the end of 2018, my country’s population aged 60 and over was approximately 249 million.
Aging society has arrived, and it has spawned a “silver economy”.
Many entrepreneurs have targeted this market. Around 2015, a large number of applications for the elderly appeared on the market.
In this field, entrepreneurs enter the entertainment industry most.
In 2015, the square dance app “Jan Dou” was launched. In the following two years, more than 60 apps on the market related to square dance appeared.
These products can easily access a large number of elderly users.
Public data shows that the total number of users of Sugar Bean exceeds 200 million; the total number of users of the audio album production software “Little Rice Cake” exceeds 500 million, and the daily life is tens of millions. More than 80 million.
In addition, some functional apps have easily mobilized millions of elderly users.
For example, the pension must be certified by social security before it is paid out. The Ministry of Human Resources and Social Security needs to confirm whether the user is alive to prevent impersonation.
Therefore, some companies have developed online authentication apps for the elderly. After the face recognition is completed, the pension will be automatically credited.
At present, in this field, the two largest domestic players are “Lao Lai Wang” and “Look at Social Security”.
Laurai Chairman Qiu Jianhua told a financial company: “At present, Laurai has nearly 20 million users. By the end of the year, this number will reach 50 million.”
Looking at social security, it is the elderly users in the rural market. Its CEO Geng Ganchao said that it “has covered 15% of China’s districts and counties.”
After two or three years of development, these elderly applications have become very mature and have a large number of users.
In addition, there are many educational and e-commerce institutions specifically targeting the elderly.
For example, to do a “beauty year” for senior education, it is providing catwalk, vocal music, and makeup courses for the elderly.
“Three years after its establishment, our users exceeded 130,000.” Huang Jihai, CEO of Wonderful Years, said.
Now, these institutions that mainly serve the elderly have reached the key point of monetization…
02 Financial Realization
For institutions that are deeply involved in the elderly market, the road to monetization is not easy.
This is because the elderly group has its own characteristics.
First of all, the minds of the elderly solidify, and if they serve the elderly users with the play of young people, they will hit the wall everywhere.
For example, young people will buy directly on the e-commerce platform based on reviews and pictures, but older people are more inclined to recommend acquaintances.
So, social e-commerce is more suitable for the elderly than platform e-commerce.
Secondly, the elderly are more sensitive to prices and more cautious about consumption.
It’s not practical for seniors to buy things. They also like to shop around. They are very concerned about price and cost performance.
This has led to many ways of monetization, which have collapsed among the elderly.
According to media reports, in 2017, Sugar Bean was launched as a shopping mall service. At the time, there were tens of millions of users, but the actual number of purchasers was only more than 300, and the conversion rate was less than 1 in 10,000.
“Now many head-to-head elderly apps, such as jelly beans, beautiful articles, and small rice cakes, are basically alive by advertising.” Industry practitioner Liu Chen revealed.
He believes that in this area, “more than 80% of entrepreneurs have not carefully studied what older users really need, but simply treat older users as traffic.”
After trying out e-commerce, travel, courses, and advertising models, some platforms have begun to break through into the financial sector.
The financial business can be divided into three types: loan, insurance and wealth management.
Elderly users do not have large expenditures and have a stable pension, and generally do not need loans, so the direction most practitioners try is insurance and financial management.
The elderly have always been the backbone users of insurance and wealth management, and their demand for this is extremely strong.
TencentAppbao’s “Mobile Internet Report for Elderly Users” stated that among the TOP100 apps whose elderly users accounted for more than the average download ratio, financial stock and securities applications accounted for 42%.
Low-interest-rate products such as bank wealth management have long been unable to meet the financial needs of the elderly, so many elderly people have poured into the stock market and even bought P2P.
Data shows that among P2P investors, over 50% of investors are over 19%.
Some elderly applications have begun to test water finance.
Last year, when I looked at the social security, I started to work with insurance companies to guide them.
At the same time, they also cooperated with banks to launch products similar to Yu’ebao in the APP.
In April last year, Laurai began to cooperate with banks to divert financial products.
In many traffic areas, finance is the ultimate monetization model.
So, in the elderly application market, can finance become a real killer?
03 Hundred Billion Market
How large is the senior financial market? Practitioners conservatively estimate that it is at least a 100 billion market.
This year, some banks also found Huang Jihai, hoping to cooperate with him. However, he still has some doubts about senior finance.
“Finance should be the easiest way for all elderly business to cash out because there is no follow-up service.” He said.
But the simplest is not necessarily the best. It is not as easy as it seems to be in senior finance.
First of all, in this field, trust is extremely difficult to establish.
In the past, financial fraud against the elderly was too frequent, so when referring to money with an elderly user, the other party would immediately be alert.
“To allow older users to accept finance, an education process is required.” Huang Jihai said.
Despite being price sensitive, there is another characteristic of the elderly-once trust is established, it will not be easily shaken, and loyalty is extremely high.
Many scams targeting older people in the past have seized the old people’s mentality. For example, people who sell health products offline will recognize the elderly as godfathers and godmothers.
So, the core element of building senior finance is to build trust.
Is there a solution to solve the trust problem?
In fact, there are, for example, the combination of online and offline, you can build a strong trust relationship.
“We will work with anti-fraud centers and banks to give users financial science knowledge and teach the elderly how to protect their money bags.” Qiu Jianhua said that these are the foundation for building trust.
At the same time, offline, the community workers of Lailaiwang will also communicate face-to-face with the elderly.
“Everyone will choose to followCooperation with banks and insurance companies at the head increases trust endorsement. “Huang Jihai said.
However, once offline is involved, hard costs such as manpower and space cannot be bypassed.
In addition, the unit price of elderly users purchasing financial products is generally low.
“Most of the products we are launching now are low-cost insurance products such as millions of medical services and accident insurance.” Geng Ganchao found that the amount that elderly users can accept is “about 100 yuan per year.”
Furthermore, old age finance must be carried out with thin ice.
The elderly group is very special, and its excessive realization or overdraft trust may be bombarded by public opinion.
“The degree of finance is difficult to grasp. If you are not careful, it is easy to be called fund-raising and fraud.” One practitioner said that the industry is now more restrained and cautious about financial realization.
“Don’t treat old users as traffic.” Huang Jihai said that old users are actually very savvy, and they can feel your ultimate goal.
He said that during the epidemic, they made 15 live broadcasts a month.
But when recommending products, they are “teaching and selling”, that is, recommending products during the class, such as lipstick in the makeup class, rather than “selling” like Li Jiaqi.
“Compared with the live broadcast products, financial products are invisible, and users need to be educated and guided.” Huang Jihai said.
With the gradual awakening of the financial needs of the elderly, more players may enter the field in the future to explore in this field.
Even entrepreneurs want to set up independent financial institutions to serve the elderly.
“However, don’t take old users as traffic harvesting.” Huang Jihai said, this is the bottom line.
*Some interviewees in the text are pseudonyms.