China is focusing on developing the silver economy, and several companies are already developing strategies

Currently, societies around the world are faced with the problem of aging populations. With average life expectancy increasing and birth rates declining, the growth of the elderly population is an irreversible trend. Statistical data suggests that the global elderly population currently represents 22% of the world's population, and projections suggest that this proportion could rise to over 33% by 2050.

As one of the world's most populous countries, China faces a particularly serious problem of population aging. A McKinsey report states: “China is expected to rapidly transition from an 'aging' to an 'aged' society by 2027, a transition that will take just 25 years.” By comparison, France has made this transition 115 years, the United States for 69 years and the United Kingdom for 45 years.”

The increasing elderly population has brought a number of challenges to China's economic development. To address these challenges, the Chinese government has introduced several measures, including the “14. Five-year plan for the development of national aging programs and the elderly care system” and the “14. Five-year plan for an active response to population aging”. and the implementation plan for the construction of child care facilities.” These measures aim to improve the healthcare system for the elderly in many aspects, focus on the development of the silver economy, ensure the health and well-being of the elderly, and ensure sustainable Social Development.

Some scientists believe that population aging will give rise to several areas with enormous development potential. Especially on the consumer side, various consumption scenarios have emerged that focus on the daily needs of older people, such as clothing, food, housing, transportation and rehabilitation care. The need for diverse services such as fitness and leisure for the elderly, education and training, cultural tourism and financial support is increasing rapidly. These mainly fall into categories such as physiological needs, health needs and emotional needs.

Physiological needs are the most basic requirements for human survival. The physiological needs of the silver-haired population have driven the development of industries such as age-appropriate food and beverages, clothing, shoes, hats, age-appropriate real estate, and household appliances. In China, companies such as Silver Carefree and Vanke have already developed strategies for the age-friendly market. Most older people tend to make minor renovations or purchase age-appropriate furniture, appliances and other household products to improve their quality of life.

The health needs of the silver-haired population have spurred the development of nursing services, medical care, physical therapy equipment and nutritional supplements. In this area, brands such as SECOM, Lexin, Maimai and Yangshengtang have already established a leading edge. According to data from Taobao and Tmall, fifty percent of the elderly surveyed suffer from problems such as high blood pressure and high uric acid levels, among other health problems with the so-called “four-highs”. In addition, problems such as osteoporosis, tooth degeneration and poor sleep cause health fears in both children and the elderly. Consumers are looking forward to more home health management products that can better support older people in self-monitoring, monitoring and maintaining their home health.

Emotional needs are also an integral part of the silver economy, driving the development of senior education and training, travel and entertainment for the elderly. According to data from Taobao and Tmall, over seventy percent of middle-aged and older respondents suffer from age-related anxiety, which can easily lead to self-doubt, frustration and health anxiety. More than sixty percent of older adults believe that cultivating interests and hobbies, social community, and wellness leisure activities are effective ways to cope with emotional challenges. To address the emotional needs of the aging population, brands such as QianChi, Hong Song and Mei Pian are wholeheartedly improving products for the elderly. QianChi, a brand of QuantaSing Group Limited (NASDAQ: QSG), is an interest-based learning platform for silver learners. The aim of the platform is to offer a wide range of courses and activities to meet the different interests and skill levels of middle-aged and older people.

Recently, the company announced its unaudited financial results for the first quarter of fiscal 2024. The financial report shows that QuantaSing's revenue in the first quarter of fiscal 2024 was RMB 869.1 million (US$119.1 million), an increase of 31.8% as the first quarter of the fiscal year ended on June 30, 2023. Adjusted net profit for the first quarter of fiscal 2024 was RMB 94.0 million, setting a new record for both quarterly revenue and adjusted net profit. Additionally, the total number of registered users across all QuantaSing brands exceeded 100 million by the end of the quarter.

Recently, the senior official of the Social Development Department of the National Development and Reform Commission of China stated: “Looking forward, China will focus on developing the silver economy, improving the welfare of the elderly and developing potential industries.” This will be the “Giving new impetus to high-quality economic development and the Chinese-style modernization process and also opening up new development opportunities for the world.”

Journalists believe that China's silver economy has enormous potential in the future with the expansion of consumption scenarios, the increase in service and product offerings, and the improvement of China's elderly care policy. It could become an important driver of China's economic growth.

About the author:

Jemima Tucker is a prominent figure in the financial technology landscape. With over a decade of experience in the FinTech sector and her deep understanding of the interplay between finance, technology and innovation, she is able to provide a distinctive viewpoint on the latest trends, emerging start-ups and cutting-edge technological developments impacting the financial industry change.