Demographics forging a new Net market: It's not your kids' Web

Demographics forging a new Net market: It's not your kids' Web

Summary: It's easy and fashionable to talk about "digital natives" that have grown up online, but the demographics of the United States are shifting radically to the grey and Web services developers should heed that news and make changes in their products and plans as a result. Old coots, like me, may hold the key to your future.

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TOPICS: Browser, Networking
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It's easy and fashionable to talk about "digital natives" that have grown up online, but the demographics of the United States are shifting radically to the grey and Web services developers should heed that news and make changes in their products and plans as a result. Old coots, like me, may hold the key to your future.

Advertising Age offers a fine summary of the demographic changes ahead in an article posted today (sorry, it's a subscription site). The key figure is that the average head-of-household in the U.S. today is 49.5 years old and that 80 percent of the growth in number of households during the next half-decade will be "among those headed by people 55 and older." These are also the people with the most money to spend in coming years.

The number of households headed by 35- to 44-year-olds and 45 to 54 year-olds will actually decrease by one percent in the next five years.

What does it mean for developers? Well, first off, you'd better start thinking about the size of type and detail in graphical components used in your designs. I know many older people who cannot read anything on a mobile phone. The iPhone appeals to older people I talk to because they can zoom in on the type. One of the winning features of the Amazon Kindle, based on my talking with people about mine, is that the text size can be adjusted to accommodate poor eyesight.

But take it a step further—the CAPTCHA challenges used by many commerce and comment systems are virtually impossible to read without being able to zoom in to see the letters more clearly. CAPTCHA phrases that frustrate older people who cannot see as well as a 20-year-old could be costing you 20 percent of your conversions, based on the number of people over 50 using the Web today, and it will only get worse.

Another feature of this older Web, according to Ad Age, is the potential for a significant change in the risk tolerance of people in many buying circumstances. "A risk-averse consumer wants to hear at least two of these three words: guarantee, safety and experience," according to Peter Francese, of Ogilvy & Mather, who authored the Ad Age article.

The care-free Web where everyone shares every personal detail isn't likely to define the future of Web services—early adopters nothwithstanding, because it is a mistake to judge the market based on the behavior of older innovators that dominate among early adopters. More typical behavior asserts itself, on average, every time. We need to be designing services that honor the desire for privacy.

This "cautious" environment is critical to your Web business today, even if you plan to cash out well before your members get old. After the initial thrill of large audiences collecting rapidly around a Web service, the valuation of acquisitions will increasingly factor in the service's ability to retain users over a long time. If your business is built on winning 20-year-olds and keeping them as customers for the five or so years before they start a family, that's not going to be sustainable.

Indeed, the next largest group will be among households headed by 25 to 34 year olds, in other words those establishing families. They'll be different families than in their parents' generation, but security and privacy, especially with regard to the online activity of children, will nevertheless be more important to these people than during their college years. That is the fact of growing up.

The other surprising element of the demographic shift, at least to me, is the increasing divergence between regions of the United States. According to Francese, we're a nation that is deciding to live in groups close to our own age and race. The West is decidedly younger and more diverse ethnically diverse than the rest of the country, while the Northeast is becoming an enclave of the older family. This fragmentation of demographic blocks appears to be accelerating, because younger people are increasingly diverse and mobile.

As we design applications that address personal needs and geographic economies, software developers may need to be thinking in terms of regionalizing services even within the formally monolithic U.S. market. That means acknowledging and serving different regions and multiple languages (particularly as a bridge to being engaged with the American experience) in our software. With 40 percent of U.S. population growth coming from immigration, this may be your greatest opportunity to start new long-lasting relationships with customers.

It won't be our father's Web, but neither will it be our children's Web. Take a cue from what marketers are worrying about in their planning when thinking about the right designs for Web services and user experience.

Topics: Browser, Networking

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