WHEN it comes to spending patterns, the young and the old have a lot in common, a new report from MasterCard shows.

Older people in Singapore and the Asia-Pacific region are expected to increase their spending on luxury items by 2.7 times to US$800 million by 2016, says the credit card organisation's latest Worldwide Insights Report.

The other key segment that is set to boom is the young premium market, which MasterCard said will grow 2.2 times to US$1.1 billion in the same period.

"The young premium segment is especially important as they are the best educated and are the primary beneficiaries of Singapore's transition to a knowledge-intensive and service-driven economy," the report says.

However, apart from the Asian giants of China and India with their masses of young people, demand from the older premium consumers - those above the age of 60 and in the top third of the market by household assets - is seen as outpacing growth from the young premium consumers, defined as those in the top third of income earners with no children.

In US dollar value terms, Japan is expected to lead with the older premium market growing from US$27 billion in 2006 to US$67.8 billion in 2016.

Japan has a rapidly ageing population. With their accumulated wealth and more time to spend it, and with continued good health, the demand characteristics of this segment are changing too, the report shows.

"Instead of looking for items to buy, they seek enjoyable experiences," it said. With many of these consumers leading active lifestyles and being avid travellers, MasterCard suggests that they might prefer authentic experiences at sites of cultural or historical interest instead of places like beach resorts.

"Their definition of luxury is therefore very likely to be very different from the usual consumption of luxury brands, expensive jewellery and related personal items," the report says.

In one illustration of this trend, the report says that in Australia, the average age of Harley Davidson motorcycle owners was 55 years, suggesting that many of these classic bike enthusiasts are in their 60s or 70s - and presumably still seeking active lifestyles.

The report estimates that well-off young people and their prosperous elders will together account for about 83 per cent of the US$258.7 billion that will be spent on luxury goods and services within the next 10 years, making them the two most important niches to target.

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