Archive for the ‘Luxury Travel’ Category

Attracting the Affluent Through Smart Offers and Targeting

Wednesday, May 17th, 2017

alc_wealth_window_luxury_credit_card-300x198As we all know, the battle to attract affluent consumers can be intense. Naturally, having great consumer insights is key to winning. Therefore, it’s valuable to understand what strategies credit card companies are using to acquire new customers, since card marketers have a very rich understanding of consumer behavior and spending habits.

So what’s happening these days in the credit card category?

While American Express has long been a dominant player, and continues to innovate, other financial institutions are realizing the value of affluent consumers and have developed prestigious cards with rich rewards to attract them.

In November, Chase made a concerted effort to attract affluent customers using powerful data strategies and highly-lucrative acquisition offers for the launch of their flagship card: The Chase Sapphire Reserve. The card offered an unprecedented 100,000-point sign-up bonus, plus many concierge-level benefits. It worked. Within months, 900,000 people applied for the card, despite an expensive $450 annual fee. (In fact, the acquisition appears to have been too rich: Chase has since reduced the sign-up bonus to 50,000 points.)

Not to be outdone, U.S. Bank recently released their own luxury card. It features a sign-up bonus of 50,000 points as well as many of the same travel-oriented benefits that made the Chase card so successful.

American Express, the longtime luxury leader, also responded to category activity by increasing the benefits of their Platinum Card.

So… what can we learn from credit card marketers?

The bar to attract affluent customers continues to increase. Luxury brands are willing to entice consumers with ever-increasing offers and enhanced services. However, given the increased costs of these services, brands must be really smart about their data targeting and offer strategies.

Hopefully, you are deploying new, smarter data strategies – aligned with consumer wants and expectations – to build your business. As always, we at Wealth Window, are here to help you pinpoint the exact customers, exhibiting the exact behavior you need, to craft messaging that will resonate effectively. My prediction, if you use Wealth Window, success is in the cards for you.

How Luxury Brands Can Win in 2017

Thursday, February 2nd, 2017

alc_wealth_window_luxury_2017Will 2017 be fabulous for luxury? We don’t know yet, but there are definitely some important trends worth considering. Let me explain…

First, on the bright side, the stock market is at record highs… consumer optimism is up… and tax cuts could be on the horizon. However, the political environment is unpredictable… there are newfound concerns about travel to the United States… and a stronger dollar could hurt the luxury category.

In the past few days, a few of our Wealth Window clients have asked me, “How can we factor these trends into our marketing plans?”

While no one can guarantee what’s going to happen to the economy overall, my years working in luxury have taught me one thing for sure: In good times or bad, certain people continue to buy luxury products and services. Granted, the makeup of these luxury consumers changes – based on stage of life, current economic/financial circumstances, and other factors – yet the ability to identify these consumers has never been more precise.

For example, we are seeing a new cohort of millennials purchasing luxury brands. These consumers don’t fall under the classic definition of wealth, yet their behavior suggests they can be the next generation of loyal, upscale customers in certain categories. For example, among these younger buyers, “experiences” – as opposed to merchandise – is doing particularly well.

Obviously, 2017 is still young. It could be a terrific year for luxury across the board, but I say hedge your bets. As we begin 2017, it makes sense to identify new segments and customized audiences most likely to buy your products as soon as possible. We can help you target highly effectively by combining discretionary spending (by amount and type of purchase) along with hobbies, interests, demographics, wealth attributes, and more.

So how can luxury brands win in 2017? To be precise, be precise.

If you’re interested in honing in on those consumers most likely to buy from you regardless of circumstances, we should talk today.

The Magic of Q1

Tuesday, January 10th, 2017

First, I hope you had a Merry BIG Christmas. I am overjoyed that so many of our Wealth Window clients reported a strong season!

As you begin 2017, I suggest you take advantage of what I call, “The Magic of Q1.”

Our experience shows that Q1 is a terrific time to test: a new strategy, a new audience, and a new channel. In fact, January and February are two of the best performing months for marketing. Additionally, if your new strategies prove successful in Q1, you can benefit all year. Conversely, if they underperform, you can cut your losses quickly.

When it comes to testing, we suggest a “Structured Spending” approach for many luxury brands: 70% of your dollars go to what has proven to work; 20% is invested behind strategies that show real promise; and 10% is allocated to dramatically different approaches that have the potential to deliver vast improvements.

Here are a couple of exciting ideas we’ve seen work for our clients:

 

Thankfully, as we enter 2017 things are looking bright. The market remains strong. Consumer optimism is high. And government policy should be advantageous for luxury brands.

Yet since markets and consumers can be fickle, you won’t want to lose any time testing innovative strategies in Q1. I’m happy to help in any way I can to ensure you experience a magical first quarter.

How will Donald and Melania Trump Impact Luxury Brands?

Wednesday, November 16th, 2016

Photo Courtesy of People Magazine

Photo Courtesy of People Magazine

History suggests that America’s first families often have significant influence over the purchasing behavior of Americans and people around the world. This was certainly the case when John and Jackie Kennedy brought their sophisticated and affluent style to the White House, replacing the rather conservative, 50’s era style of the Eisenhower’s. (Tuxedos anyone?) Ronald and Nancy Reagan brought Hollywood glamour to Washington—an obvious departure from the homey style of the Carters. (Oscar de la Renta and Bill Blass certainly benefitted.)

And now, Donald and Melania Trump are bringing their lifestyles of the rich and famous to the White House, and, let’s face it, the Trumps have never been shy about the media. This begs the question: How will their affluent, opulent way of life influence luxury brands and spending on upscale goods and services?

Here are some questions that are on my mind – and probably yours as well:

 

These are just a few of the questions that will be answered over the next few months, and during the Trump presidency. But one thing seems certain, the rich will get richer, and smart marketers should be thinking about how to leverage this unique opportunity.

If you think there’s a trend you can capitalize on, let’s talk. I’d love to hear your thoughts.

How Luxury Brands Can Crack the Code on Audience Segmentation

Friday, July 15th, 2016

For luxury brand marketers, the time has never been better to invest heavily in digital. If the goal is to put your brand and your message in front of as many eyeballs as possible, and if most eyeballs spend a large portion of each day glued to some type of digital screen…well, you can see where this is headed.

In fact, 71 percent of luxury brands increased their digital marketing budgets last year. To add to that, over half of all luxury companies expect to spend at least 30 percent of their marketing budget on digital in the coming year.

But despite all of this money being put into the digital sphere, the returns just don’t seem to be adding up. As it turns out, the biggest thing that luxury brands have missed in their digital media frenzy, is that getting in front of the most eyeballs is less important than getting in front of the right eyeballs.

Herein lies the problem for many luxury marketers: the typical affluent consumer doesn’t quite look the same as he or she used to. In fact, there may no longer even be such a thing as a “typical” affluent consumer.

wealth is a moving target

Reaching affluent consumers is a moving target.

Today, the techie with a studio apartment in Silicon Valley buying tickets to Comic Con can be a luxury consumer in the same way that a CEO with a penthouse on Madison Avenue buying tickets to Cannes is a luxury consumer.

Audience segmentation is difficult when your audience is continuously evolving, and trying to navigate this nuanced and fluid environment is indeed a problem for luxury marketers in the digital sphere – but it’s not a problem that data can’t solve.

With the right data, luxury brands can target the right audiences – instead of opting for the old “spray n’ pray” method. Smart, innovative data, like what Wealth Window has to offer, makes it possible to engage and influence new audience segments that are out of reach for many luxury marketers.

In a pre-digital world, luxury brands could get away with mass marketing to the most affluent consumers and ignoring the rest of the field – but not anymore. New pockets of wealth are emerging among previously untapped demographics like millennials, women, and minorities. Different audiences are interacting and talking about luxury across many different digital media platforms. The focus needs to shift to accommodate not only today’s luxury consumers, but tomorrow’s as well.

Instead of broad, reach-focused media buys, luxury brands should be focused on data-driven behavioral audience segmentation. Instead of focusing on brand awareness, luxury marketers should be creating and nurturing more intimate relationships with smaller segments of like-minded consumers who will, in turn, influence each other.

The bottom line is that luxury brands are currently struggling with an audience identity crisis when it comes to digital marketing – but it doesn’t have to be that way. Segmentation can help luxury brands crack the code on who their best audiences are, and how to speak to them in the most impactful way – and data is the key to doing just that.   

Now Trending Among Affluent Foodies: Culinary Tourism

Tuesday, May 26th, 2015

Market culinary travel destinations to affluent high net worth travelers.

Affluent foodies are flocking to culinary travel destinations.

According to the 2015 Virtuoso Luxe Report, Culinary travel is one of the top 10 travel trends of the year. Take the Silverado Resort and Spa’s Royal Oak in Napa Valley for example. Here culinary travelers can enjoy a seven-course, farm-to-table feast at Thomas Keller Restaurant Group’s pop-up restaurant Ad Lib for just $295 with wine pairing. Make your reservation soon — it pops down in October!

Meanwhile there’s a revolution in the cruise industry’s dining culture. Geoffrey Zakarian, a Food Network Iron Chef and the chef at Lamb’s Club in New York, has restaurants on two Norwegian Cruise Line ships. Royal Caribbean’s Quantum of the Seas is a floating home for Michael’s Genuine Pub of famed Miami chef Michael Schwartz. Up on the next deck is Jamie’s Italian restaurant, of British celebrity chef and star of “The Naked Chef,” Jamie Oliver. Crystal Cruises operates a restaurant in partnership with celebrity fusion chef, cuisine Nobu Matsuhisha.

Affluent travel destinations are also turning to culinary experiences to entice affluent foodies. At the Ritz-Carlton on Seven Mile Beach, famed chef Daniel Boulud, of NYC’s famed Daniel, dazzles crowds at the Cayman Cookout, an annual event that brings in top celebrities like Marcus Samuelsson, Jose Andres, and Anthony Bourdain to spice things up for a well-heeled audience of jet-setters.

Serious epicures can also delight in hands-on extraordinary food-focused experiences in far-flung places. Guests at Peru’s Inkaterra Machu Picchu Pueblo Hotel learn about the local tea by picking, grinding and bagging leaves themselves. Istanbul offers insider tours to the city’s famed bazaars and classic Turkish meal cooking lessons back at the hotel. In Kenya, luxury tent campers pick fresh produce from organic gardens and assist in creating an alfresco lunch, surrounded by the Masai Mara game reserve.

“Unique food and drink are the perfect attractions, especially for second and tertiary destinations that now must market more proactively in the globally competitive market,” states Erik Wolf, President and CEO of the International Culinary Tourism Association.

Now if only there was a way to reach high-net-worth travelers with a passion for gourmet dining. Oh but there is! Wealth Window can put that package together for you.

The Rising Tide of Mass Affluence Among Women

Wednesday, February 4th, 2015

Women are experiencing a rise in female mass affluence and are prime prospects for luxury marketers and financial service providers.

America is seeing a rising tide of affluent women becoming captains of their own ships.

Now that women control half of the private wealth in the country,* it’s time for financial service providers, luxury real estate marketers, non-profits seeking high dollar gifts, and every other purveyor of upscale goods and services to focus on them.

Over 41% of Americans with incomes exceeding $500,000 are women. By 2020, women will account for $22 trillion in spending as wealth continues to shift from men to women. There are numerous reasons for this trend. Here are the top 3 that I can see:

 
Constituting half of the U.S. workforce, women are empowered to take charge, “lean in,” and demand more pay. In fact, two out of five working married affluent women age 40-69 report that they earn the same or more than their husbands. Yet when it comes to investing, they lack confidence. An overwhelming majority say that it is important women have confidence in their ability to invest, but only 8% say they are. Clearly this presents a huge opportunity for financial advisors to specifically reach out to affluent female investors.

There’s a large and growing leadership of elite female role models soaring to new heights in formerly male-dominated business sectors. Here are just a few that quickly come to mind:

 
And that’s just the tip of the iceberg. A society where women can rise to the highest levels of net worth makes it possible for women in general to attain mass affluence. This rising class of self-made professional women is making a huge impact on the economy. It’s a force to be reckoned with and I suggest that a good start is to speak to affluent women as primary decision makers in a voice that will resonate with them.

* Source: The Power of the Purse: How Smart Businesses Are Adapting to the World’s Most Important Consumer – Women

Follow the Money to Cuba

Friday, January 16th, 2015

Wealthy Americans will capitalize on softening relations with Cuba in travel, real estate and import/export.

Wealthy Americans will capitalize on softening relations with Cuba.

With the loosening of the US embargo on Cuba and the removal of many travel restrictions, you can be sure that wealthy Americans will quickly take advantage of new opportunities. First off, many are clamoring to travel there right away. According to an article published by the Associated Press, “The few US companies facilitating travel to Cuba say inquiries have exploded since December.”

Additionally, with the easing of restrictions to certain sectors of trade and investments, Cuba will be attracting investors who want to get in on the ground floor of what could become a complete lifting of the embargo in the future.

Other Financial Implications of the Softening of Relations Include:

 

The News Has the Art World Buzzing

This formerly isolated nation simply bursting at the seams with creativity is seen as the next hot market in art. In a recent two-week period, a record $2.3 billion of Cuban art was just auctioned. According to Alberto Magnan, a Cuba-born NYC Gallery owner, thawed relations will have a huge impact because Cuba was a limited market in terms of who was even able to see the art. “That number now will become huge,” he said.

Opening the Flow of Luxury Goods

Trade restrictions with Cuba have been eased allowing agricultural equipment, building materials and goods for private-sector Cuban entrepreneurs to be exported from the US. Import restrictions have also loosened, with licensed US travelers authorized to bring Cuban goods (read: cigars) back to America, purchased with their US credit and debit cards. You can bet that wealthy opportunists will capitalize on the friendlier relations between Cuba and the United States.

Real Estate Investment Will Surge

It’s just a matter of time when Cuba opens up completely to American tourists and accommodates their penchant for luxury accommodations. “You’re going to see American hoteliers doing their best to find potential properties in Cuba,” says Steve Loucks, Chief Communications Officer of the Travel Leaders Group. “Four-star resorts don’t go up in a day…but we’re very positive about the potential.”

The good news for marketers is that Cuba is close and now you can have the cigar. You just need to get that message into the hands of wealthy travelers and affluent investors.

Green is the New Color of Luxury

Tuesday, September 30th, 2014

Affluent, eco-conscious consumers are driving the greening of luxury brands.

Affluent eco-conscious consumers are driving the greening of luxury brands.

Well not literally, but luxury brands are becoming more sustainable, spearheaded by such visionaries as Bernard Arnault, CEO of LVMH (Louis Vuitton & Moët Hennessy). He states that, “Environmental protection is not merely an issue of generosity or philanthropy. It is critical to our future.” LVMH is guided by a global charter that defines environmental protection criteria and goals. Its Environmental Affairs Department works to ensure the best ecological practices at all levels of production.

There is plenty of evidence that sustainability is a rising priority among purveyors of luxury goods…

  1. According to Fashionbi, most luxury companies locate their production houses at premium locations – i.e. “Made in Italy,” “Made in France” – thereby avoiding a larger carbon footprint associated with manufacturing all over the world.
  2. Gucci has attained the SA8000 Social Accountability Standard, which includes reduction of its environmental footprint. The company’s plant has attained ISO 14001 Environmental Certification.
  3. Greenpeace named The Valentino Group #1 in terms of Dedication to the Environment.
  4. The Copenhagen Fashion Summit is the world’s largest event in sustainability in fashion.
  5. Piaget states on its website that the company “has decided to take action to reduce our impact on the environment by using raw materials that have been extracted and processed according to the strictest standards and by implementing strong business ethics.

 

Of course a strong driver of increased environmental responsibility is the demand among luxury buyers that their brands are backed by sustainable companies.

The Luxury Institute finds that younger, more-affluent consumers increasingly seek information about corporate social responsibility. “Young consumers believe that caring about the environment is how you create a meaningful life,” notes Milton Pedraza, the firm’s CEO.

Affluent travelers are taking “eco-luxury” excursions guided by fast-growing eco-tourism companies such as National Geographic Expeditions. The Four Seasons Resort in Maui even provides eco-friendly limousine service featuring the all-electric Tesla sedan.

Luxury consumers are becoming more cautious in their choices and look not only for quality, but also to a product’s materials, how it is made and the company behind it. As more brands embrace sustainability and speak to their green initiatives, customers will become more demanding in their preferences for environmental accountability.

Oftentimes “green” products may carry a higher price tag, but as you can see, there is a market for the greening of luxury. In fact, Wealth Window has identified over 15 million “Green Affluents,” who expect their favorite luxury brands to serve as industry leaders in their sustainability practices.  These affluentials are making a positive impact on the environment by voting with their wallets.

Marketers without Borders

Thursday, September 11th, 2014

Directly tap into global wealth by targeting affluent consumers around the world

Global email and mailing lists of affluent consumers, investors, travelers and donors can help grab international, luxury brand market share.

The rise in global affluence has expanded demand for luxury products and services well beyond the United States. Just as brand name retailers have literally opened the doors to new stores sited in strategic international locations, direct marketers can also capture international market share by driving foreign customers to their websites by both email and direct mail.

Through the convenience of online shopping, many etailers are shipping worldwide. Fundraising for worldly causes has spread to donors all around the world. Investors overseas are flocking to U.S. markets. And international travel is skyrocketing among the nouveau riche in many countries outside the U.S.

But thus far, acquiring new customers, donors and investors from afar has largely been a passive process, whereby people from other nations are searching and finding what they are looking for online. In luxury brand marketing, it is essential to establish brand loyalty early on because, well, customers tend to remain loyal. So now is the time for marketers seeking a bigger slice of international market share to take their message directly overseas to international consumers of means.

As Media Post reports, favorable exchange rates, affordable home prices and rising affluence abroad are driving international buyers to American real estate investments. This tells me that there is a large international audience out there with capital to invest and who are most likely frequent fliers.

Therefore, the first two upmarket sectors that come to mind for direct marketing to the world’s wealthy are:

1. Luxury Travel

Global jet setters are searching for:

 

2. Financial Services

International investors are seeking:

 

All luxury marketers can generate brand appeal among the über-wealthy in numerous countries that are home to a growing number of affluent consumers — China, France, Germany, Italy and the United Kingdom to name a few. Utilize  email as well as international postal mail to seize the opportunity to establish brand preference among the world’s elite investors, first class travelers, luxury shoppers and major donors.

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