In October 2006, the U.S. population reached 300 million: 4.57 percent of world population — about the same percentage as in 1900. Demographic shifts in other countries are more sweeping.

By studying shifts in world demographics, you can pinpoint where tomorrow’s major populations will live, identify fastest-growing age groups — an important indicator of tastes and needs — and predict demand for your products or services.

Tomorrow’s Markets

Almost all net global population growth — the difference between births and deaths — will occur in developing countries located in Africa, Asia, and Latin America. By 2015, China's and India's populations are expected to reach almost 1.39 billion and 1.27 billion, respectively.

The United States will reach 323 million, with the next leading countries located in Asia and South America. As a result of low birth rates, Europe’s share of world population has fallen by half since 1990, according to the Progressive Policy Institute, a Washington, D.C., think tank.

In terms of buying power, low annual per-capita income figures can be misleading. For instance, India's per-capita income is only $620. However, the country is estimated to have a middle class of more than 200 million people with the same purchasing power as the U.S. middle class — a growing market well worth pursuing.

The Age Factor

Average life span throughout the world is projected to increase from 64 years in 2002 to 69 years by 2025, and to 77 years by 2050, according to the U.S. Census Bureau. This increased longevity has contributed to world population growth. But that is not all.

The elderly population in the United States and the rest of the developed world will increase by more than 50 percent. The greatest relative increase will occur in developing countries, while the largest absolute change will take place in Asia.

Demand for products and services designed to satisfy the needs of this group, especially health-related products and home care, is anticipated to rise dramatically.

Follow the Median

As the elderly population increases, the world's median age also continues to rise. In 1998, the median age was 24 in less developed nations and 37 in more developed countries. However, by 2025, median ages will rise to 30 and 43, respectively. This significantly affects consumer spending.

According to Harry Dent, Jr., author of The Roaring 2000s Investor, as the average American reaches peak spending, the children begin to leave home. Empty-nest couples spend more on vacation homes, travel, and leisure. Spending patterns in other developed nations are similar to those in the United States.

As the median age rises in both developed and developing countries, consumer spending also will rise. Consequently, closely monitoring shifting demographics and better identifying your target market is a sound strategic decision.

This article appeared in October 2006. (CM)
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John Manzella
About The Author John Manzella [Full Bio]
John Manzella is a world-recognized author and speaker on global business, competitive strategies and the latest economic trends. He also is founder of the ManzellaReport.com and Chief Strategy Officer of Ignition Life Solutions. His latest book is Global America: Understanding Global and Economic Trends and How To Ensure Competitiveness.




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