The top states include Delaware, Florida, Maine, Montana, New Mexico, North Dakota, Pennsylvania, Vermont, West Virginia, and Wyoming. However, three states, California, Florida, and Texas, will account for nearly 46% of total seniors between 2000 and 2030.
Tracfone is also leveraging the fact that travel among older Americans is on the rise. According to the Department of Commerce (DOC), the number of U.S. travelers over the age of 55 has increased 10% year-to-year for the past 5 years. Moreover, the Canadian Snowbird Association reported that travel between Canada, Florida, and Arizona topped 100,000 “snowbirds” in 2006.
Many of these tourists are engaging in “heritage” or “cultural” tourism. These include tours to historic locations, cultural events, festivals, and fairs. All of these tours allow seniors to move at a pace they can set, are generally affordable, can often be reached by bus or train, and do not require extensive preparation and procedures. In 2006, for example, the percentage of total tourists engaging in this type of tourism, according to the DOC, reached 70%.
Beyond this, AAA, AARP, and several other organizations have launched programs that provide local driving services, group walking, bicycling and exercise, and similar initiatives to increase the general activity and health of older Americans. These include programs like Lifelong Safe Mobility, Active Living Communities, and so on.
Tracfone is positioned smartly to capture a segment of the senior citizen market that sits right alongside traditional pre-paid customers (especially credit-challenged customers) but also resides in a totally different space.
It’s no wonder that 25% of Tracfone’s customers are seniors. Tracfone’s significant and steady growth rate has come at a cost to Cingular, Cricket, MetroPCS, and VZW’s prepaid offerings. And estimates are that this upward trajectory will continue. Further, Tracfone has demonstrated a number of ways it can market, advertise, and position its products and services in a cost-effective manner.
Tracfone is located in more than 65,000 retail locations throughout the U.S., making it highly convenient to purchase. It’s “AutoPay,” easy activation and deactivation processes, and robust customer care provide simplicity, security, and ease of buy-in and retention that older Americans desire.
Tracfone has become a legitimate cellular alternative to the user who does not want a subscriber contract and requires low monthly usage. We expect to see Tracfone successfully penetrate other niche markets in the future as well. Which one will it be this year?
