Although they may not like being called the Silver Tsunami, there is little doubt that the population wave of Baby Boomer seniors marks one of the biggest market opportunities for technology integrators. The potential consumer base is vast by any measure, but for savvy integrators, opportunities in the business-to-business (B2B) space may be just as big and even more lucrative.
The numbers are staggering – some 77 million American Boomers became “seniors” in 2010, and 10,000 more will turn 65 every day into the 2030s. That represents a huge customer pool for residential smart environments that every integration business could be actively targeting.
In fact, in a recent report on caregiver solutions for “the longevity economy,” AARP estimates that monitoring service alone was a $1.8 billion business in 2017 – and it is predicted to rise to $3 billion by 2021. Additional smart home technologies that will become commonplace – telemedicine, health and safety for aging in place – will push the U.S. market forecast to $23 billion.
A market growing so quickly to such a massive size will obviously drive a lot of momentum. Consumer-facing DIY monitoring systems will take a significant slice of the pie, as will the triple-play service providers who already own a significant footprint in these consumer’s homes.
The Emerging B2B Market
With these often gigantic competitors, how can security integrators get in on the action? One solution may be to focus on the fast-growing B2B opportunities that are emerging with the longevity economy.
Who are these B2B customers? They are large and small businesses that provide everything from at-home caregiver services to live-in nursing facilities and assisted living communities. They actually encompass all the organizations, agencies and facilities that will service these seniors.
As is true with many of today’s industries, these verticals are being transformed by technology trends and the economy – which means security integrators will be able to find a wealth of opportunities for equipment sales, installations, maintenance and potential RMR.
Poll after poll has shown that 90 percent of seniors want to continue to spend their lives in their own home; unfortunately, that desire is not always possible. People are living longer today – a 65-year-old American can expect to live another 19 to 21 years, according to the Social Security Administration. A quarter of 65-year-olds will hit age 90, and one in 10 will live beyond age 95.
As people reach these ages, they require more care attention and services for daily living.
In-Home Care Services
Many of these care services will take place within a consumer’s home, and the agencies that provide them represent a promising B2B opportunity.
These companies desire many of the same functions that smart home integrators already know well from their residential and commercial experience – such as smart access controls, environmental monitoring, and the ability to track activity, wellness and risk remotely.
According to a report by home health and hospice agency consultant Fazzi Associates, just 23 percent of home care agencies are currently using telehealth systems – and nearly 40 percent of large agencies and 50 percent of small agencies have potential telehealth units that are not actually in use.
With telehealth slated as a key response to the care shortage, integrators that can deploy and configure these systems will be in high demand.
The Housing Trends Influence
Of course, not all seniors will be able to stay at home; in fact, AARP is now reporting that only 76 percent of Americans age 50 and older prefer to remain in their current residence. The report adds that only 59 percent of those surveyed anticipate they will be able to stay in their community, either in their current home (46%) or a different home still within their community (13%).
Why the change of heart? The housing market collapse has been a key culprit. In the past, many seniors or their families sold their homes in order to pay for nursing home care. Unfortunately, some seniors’ homes may not be worth as much as they were when they bought them.
The AARP survey finds that many adults age 50 and older are willing to consider newer alternatives, such as home sharing (32%), building an accessory dwelling unit (31%) or retirement villages that provide services that enable aging in place (56%). All these scenarios are important for integrators to watch closely.
Nursing Homes and Assisted Living
Nursing homes are also prime opportunities for technology integrators. The industry is currently undergoing a severe shortage of personnel and is trying to quickly adapt to disruption in the market.
According to Health Dimensions Group, many of America’s 15,000 skilled nursing facilities (SNFs) will ultimately be converting to senior housing alternatives, such as monitored low-income or market rental apartments, assisted living or memory care centers – all of which have experienced increased consumer demand. These facilities can be optimized with smart home technology and monitoring services.
In the meantime, assisted living itself has become a growth industry (read more on page 48). According to McKnight Senior Living, skilled nursing centers still represent the lion’s share of the seniors housing and care market at 67 percent; however, but assisted living now owns 16 percent of the market.
Retirement/residential (independent living) is the third-largest category for seniors, at 4 percent of the market – and of course, every one of these facilities is a potential customer for smart home and telehealth integration.
Silvia Madrigal is a Senior Business Development Executive for Silicon Labs (www.silabs.com), a provider of silicon, software and solutions for a smarter, more connected world. Ms. Madrigal formerly held leadership roles with Alarm.com, GE and a Blockchain startup.
