Understanding Today’s Affluent Consumer Wealth Market Research and Trending
Wealth is Growing: The Rise of 3 levels in the US (Millions of people) Source: 2007 Spectrem Group 5 year growth: 138%
United States High Net Worth Distribution Map Source: CNN Money
plutonomy   n . An economy that is driven by or that disproportionately benefits wealthy people, or one where the creation...
“ To us there are certain economies, driven by massive income and wealth inequality – plutonomies – where the rich are so ...
LET’S SAY THAT AGAIN: “ In the US, the top 20% of consumers account for nearly 60% of income and spending.  The bottom 20%...
“ And a third conclusion was that Plutonomy would likely drive a positive operating environment for companies selling to o...
CurtCo Media: Several Unique Niche Readers Tied Together By Affluence
CurtCo:  Targeting The Top (Not to scale) UHNWI=Ultra High Net Worth Individuals, HNWI=High Net Worth Individuals UHNWI $3...
Mendelsohn Affluent Survey: Volumetrics HNWI households are controlling RE, securities and product spending.  Just over on...
 
Now That We Know Who, What’s Next? <ul><li>Understanding The HNWI Mindset: </li></ul><ul><li>The Worth-Harrison Taylor Sur...
Myth: Most Modern American Wealth Is Inherited
Actually, Modern American Wealth  Is Largely Entrepreneurship Driven
The 4th Wave of American Wealth <ul><li>Landed Gentry </li></ul><ul><li>Agricultural base </li></ul>Agrarian  Industrial C...
“ Today, most of America's rich are self-made, and  inherited wealth counts for less than 10%   of the fortunes of current...
 
How did they get there and what are their characteristics? Who Is the Modern HNWI? The Triumph of the Middle Class:   From...
How did they get there and what are their characteristics? Very middle class answers! Who Is the Modern HNWI? Source: The ...
“ Today, the rules for high society are breaking down. There are simply so many new millionaires and billionaires -- from ...
Lux Marketers’ Perceptions Versus Wealthy  Reality Lux Marketers’ Wealthy “ Guess” Reality % % % of Wealthy People That: W...
CurtCo Readers:   “This Is How We Like Our Lux Retail” 1.  Inherent product quality:  98% 2.  Staff that are skilled produ...
Bespoke Items The Market Amongst wealthy US individuals (average net worth of $3m),  42% have purchased “bespoke” items.  ...
 
<ul><li>The Experience:   </li></ul><ul><li>Not just high priced, but excellent </li></ul><ul><li>Brand/Price/Value:   </l...
The Six P’s of Luxe Marketing (as described by Winsper) People —This is not a robotic transaction, brand opens doors, but ...
Understanding Today’s Affluent Consumer Wealth Market Research and Trending
Upcoming SlideShare
Loading in …5
×

Rr luxmkt-demo

358 views

Published on

Published in: Career, Business, Technology
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
358
On SlideShare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
0
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Rr luxmkt-demo

  1. 1. Understanding Today’s Affluent Consumer Wealth Market Research and Trending
  2. 2. Wealth is Growing: The Rise of 3 levels in the US (Millions of people) Source: 2007 Spectrem Group 5 year growth: 138%
  3. 3. United States High Net Worth Distribution Map Source: CNN Money
  4. 4. plutonomy n . An economy that is driven by or that disproportionately benefits wealthy people, or one where the creation of wealth is the principal goal. [Blend of pluto- (wealth) and economy .] Plutonomy
  5. 5. “ To us there are certain economies, driven by massive income and wealth inequality – plutonomies – where the rich are so rich that their behavior overwhelms that of the “average” or median consumer. Last year, for example, we suggested that in the US, the top 20% of consumers might account for nearly 60% of income and spending. The bottom 20% by contrast account, on our data, for about 3% of income and spending.” --Ajay Kapur, Citigroup Source: Citigroup Global Investigator Plutonomy
  6. 6. LET’S SAY THAT AGAIN: “ In the US, the top 20% of consumers account for nearly 60% of income and spending. The bottom 20% by contrast account, for about 3% of income and spending.” Source: Citigroup Global Investigator The people The money Middle 60% of consumers Top 20% of consumers Bottom 20% of consumers 60% of Income and spending 37% of Income and spending 3% of income and spending
  7. 7. “ And a third conclusion was that Plutonomy would likely drive a positive operating environment for companies selling to or servicing the rich.” (like us!) Source: Citigroup Global Investigator
  8. 8. CurtCo Media: Several Unique Niche Readers Tied Together By Affluence
  9. 9. CurtCo: Targeting The Top (Not to scale) UHNWI=Ultra High Net Worth Individuals, HNWI=High Net Worth Individuals UHNWI $30MM+ HNWI $1MM+ Generic “Affluent” $85k+ HHI As defined by Monroe Mendelsohn Under $85k+ HHI CurtCo Demographic Target
  10. 10. Mendelsohn Affluent Survey: Volumetrics HNWI households are controlling RE, securities and product spending. Just over one-third of the affluent population is controlling 50 to 80% of the money and the purchases made with that money! Source: 2007 Mendelsohn Affluent Survey
  11. 12. Now That We Know Who, What’s Next? <ul><li>Understanding The HNWI Mindset: </li></ul><ul><li>The Worth-Harrison Taylor Survey on the Status of Wealth in America </li></ul><ul><li>Designed to understand the mindset of today’s affluent American family </li></ul><ul><li>It involved an hour and a half interview </li></ul><ul><li>500 families with liquid assets at least $5MM+ </li></ul><ul><li>Of the 500, nearly 1/5 were CurtCo subscribers. </li></ul>
  12. 13. Myth: Most Modern American Wealth Is Inherited
  13. 14. Actually, Modern American Wealth Is Largely Entrepreneurship Driven
  14. 15. The 4th Wave of American Wealth <ul><li>Landed Gentry </li></ul><ul><li>Agricultural base </li></ul>Agrarian Industrial Corporate <ul><li>Factories </li></ul><ul><li>Market base </li></ul><ul><li>Inventions </li></ul><ul><li>Assets </li></ul><ul><li>Distribution </li></ul><ul><li>Conglomeration </li></ul><ul><li>Innovation </li></ul>Entrepreneur <ul><li>Idea </li></ul><ul><li>Marketing </li></ul><ul><li>Focus </li></ul><ul><li>Innovation </li></ul><ul><li>Capital </li></ul>1650 - 1850 1850 - 1950 1950 - 1980 1980 - ? Source: The Worth-Harrison Taylor Study on the Status of Wealth in America
  15. 16. “ Today, most of America's rich are self-made, and inherited wealth counts for less than 10% of the fortunes of current multimillionaires. Entrepreneurs are the new kings of affluence.* The inherited wealthy are looked down upon as, in the words of billionaire Warren Buffett, &quot;members of the lucky sperm club.&quot; *Source: Prince and Associates
  16. 18. How did they get there and what are their characteristics? Who Is the Modern HNWI? The Triumph of the Middle Class: From Humble Beginnings… Source: The Worth-Harrison Taylor Study on the Status of Wealth in America Gated Community Inner City Rural Urban Suburban Where Grew Up Wealthy/Affluent Upper Middle Class Middle Class Lower Middle Class Poverty Economic Status of Parents
  17. 19. How did they get there and what are their characteristics? Very middle class answers! Who Is the Modern HNWI? Source: The Worth-Harrison Taylor Study on the Status of Wealth in America Keys to Success in Business/Career Hard work Perseverance/Dedication Ingegrity/Honesty/Treating people well Luck Focus Good education Take advantage/recognize opportunities Being happy/Liking what do Good network/contacts/support group Intelligence
  18. 20. “ Today, the rules for high society are breaking down. There are simply so many new millionaires and billionaires -- from diverse backgrounds and lifestyles -- that the old signifiers of status have become obsolete. The guy in jeans at the Sotheby's auction is more likely to buy a $40 million Picasso than the guy in the suit, who is probably just an art dealer. And the vast majority of today's richest Americans didn't go to Ivy League schools; others, like Bill Gates, even dropped out.” So… Never judge a book by its cover! --Robert Frank Wall Street Journal June 22, 2007
  19. 21. Lux Marketers’ Perceptions Versus Wealthy Reality Lux Marketers’ Wealthy “ Guess” Reality % % % of Wealthy People That: Would describe themselves as a very happy person 75 95 Would describe themselves as middle class at heart 68 81 Want people to know that they are wealthy 55 11 Are married 52 83 Underestimated Have compromised their values to make money 65 9 Are concerned about their children’s work ethic because they have always had money 95 50 Feel they carry an unfair tax burden 90 53 Overestimated Sources: The Worth-Harrison Taylor Study on the Status of Wealth in America, Agency Sacks/Harrison-Taylor/Brandweek Marketers Survey The same questions yield radically different results when asked to the rich versus asked to those who serve the rich !
  20. 22. CurtCo Readers: “This Is How We Like Our Lux Retail” 1. Inherent product quality: 98% 2. Staff that are skilled product experts: 93% 3. Staff that makes me feel at ease: 78% 4. Getting a great deal: 59% 5. Feeling like I am the most important customer they have: 51% 6. Provides an exclusive, luxurious sales environment: 27% Desirability Of Characteristics To Create An Ideal Shopping Experience : Environment is nice, but product brand/quality are king! (responses are in order of % agree) Source: The Worth-Harrison Taylor Study on the Status of Wealth in America CurtCo high net worth subscriber subset
  21. 23. Bespoke Items The Market Amongst wealthy US individuals (average net worth of $3m), 42% have purchased “bespoke” items. Additionally, once these consumers have bought from a bespoke brand they remain loyal, with 87% stating that they would buy from the brand again. (Luxury Institute) HNW Robb subscribers mirror (and exceed) this trend: 60% bought a bespoke or made to order clothing item last year. 44% bought bespoke or made to order watches and/or jewelry. (RR 2006 Sub Study) CurtCo Readers: “This Is How We Like Our Lux Retail”
  22. 25. <ul><li>The Experience: </li></ul><ul><li>Not just high priced, but excellent </li></ul><ul><li>Brand/Price/Value: </li></ul><ul><li>Brand reduces risk and will win out when price and quality are similar. </li></ul><ul><li>It may be $10 or $10,000,000—but the perception of value must exist. </li></ul><ul><li>Style/Quality: </li></ul><ul><li>Style is assumed based on brand name and will not beat brand or price </li></ul><ul><li>Clear attributes/Respect: </li></ul><ul><li>Fact X and fact Y are more important in marketing than “luxurious” or “you deserve” </li></ul><ul><li>Accept their values, don’t assume anything and educate them when necessary </li></ul><ul><li>Don’t judge a book by its cover: </li></ul><ul><li>Won’t necessarily be dressed in tuxedos—they desire to blend in </li></ul>Applying The Lesson: What Does This Consumer Value Most?
  23. 26. The Six P’s of Luxe Marketing (as described by Winsper) People —This is not a robotic transaction, brand opens doors, but there is still a need for connection, sales and service. Pass-Along experience. Product —quality, heritage, pricing, SCARCITY Passion —HNWI consumers are certainly not all the same, but each has passions that are served by luxe brands. Marketing of those brands needs to speak to this passion and create demand. Collect! Pleasure —these are not necessities, so pleasure must be fulfilling during research, purchase and use phases (and memories?) Purpose —pleasure only? Or utility? Or both? (jewels/jets) Price —High price is expected, but make sure that attributes are conveyed, like value, quality, rarity. Halo affect works, but to what level?
  24. 27. Understanding Today’s Affluent Consumer Wealth Market Research and Trending

×