Recurring Revenue: The Future of Home Integration Part 8
A reported 91 percent of people aged 50 to 65 say they want to stay in their own home indefinitely following retirement. Yet few have planned—or budgeted—for the assisted living (or higher and more costly levels of care) that most will ultimately need. And it seems unlikely that government programs will be able to keep up with the huge numbers of aging baby boomers that modern medicine will keep alive well into their 80s, 90s and beyond.
A Golden Opportunity
Wireless home integration can be used to help reduce the risks of injury, dehydration, malnutrition, security lapses and other misadventures that often force patients from their homes and into assisted living or nursing care. Many aging-in-place applications involve simple modifications of standard home integration features—adapted and programmed to a patients' specific needs, so they can live independently at home longer, with reduced risk for the patient and reduced anxiety for the family.
Because the cost of assisted living is so high, the payback period for investment in appropriate aging-in-place products and services is typically quite short—often a few months or less. That compares very favorably with the payback for conventional home integration applications, like using lighting, HVAC, and shade control to reduce energy costs—where the period is typically four years or more (depending on energy costs, local climate, and home efficiency).
The aging-in-place segment that is emerging will provide a unique opportunity for home integrators to help clients and their families in a time of need. It also can be very profitable.
Three Key Advantages
The aging-in-place sector has three unique advantages: First, it is poised to grow dramatically as the large Baby Boomer generation ages (and ages), and as government programs like Medicaid become less and less able to support the needs of the elderly. Second, it involves purchases that are basically non-discretionary. They are typically driven by health and safety imperatives—in the context of a crisis—rather than discretionary consumer spending decided upon at leisure. Third, because these purchases involve specialized assessment, design and installation services, they cannot readily be commoditized by Best Buy, Amazon.com or the large electronic service providers.