View all newsletters
Latest in Luxury - Sign up to our newsletter

Elite Traveler – ET Insider – January 12, 2010

Array

ET Insider – January 12, 2010

Elite Traveler Insider –

etlogo

January 12, 2010

Elite Traveler Insider

By Douglas D. Gollan, President and Editor-in-Chief, Elite Traveler Magazine  

Welcome to the latest issue of Elite Traveler Insider, the bi-weekly newsletter designed to update our top partners on trends in the private jet lifestyle. This information is provided to offer a better understanding of how to target these globetrotting elite travelers, their impact on your business and other trends that affect you. Remember, private jet travelers are paying up to $10,000 per hour to fly by private jet, so these super rich consumers could be and should be your best customer. We talk about them and how you can get more of them and more from them.

IN THIS ISSUE:

1. Private Jet Travel Jumps 22% in November

2. Terrorism Scares, Bad Weather Boost Private Jet Flying

3. December Jobs Data Show More Pain for Mass Affluent Sector

4. In Hawaii, Obama and Private Jets, but Room for More

5. The Independent – Margareta Pagano: The Super-Rich Still Rule our Economy

Over 90 percent of today’s Super Rich are Self Made and over 80 percent of the Super Rich have made their fortune in the past 10 years. Now is the best time to make sure they know your brand. 86% believe Elite Traveler is a good showcase for luxury products.

1. Private Jet Travel Jumps 22% in November

The nice thing about targeting folks who fly by private jet in an environment where marketers want to make sure every penny is reaching a qualified consumer (over 600,000 every issue of Elite Traveler) is simple: anyone flying on a private jet today A) still has significant wealth and B) is proving they are in the psychographic frame of mind for luxury spending.

There’s even better news coming from ARGUS TRAQPak data for serial-number specific aircraft arrival and departure information on all IFR flights in the US (including Alaska and Hawaii). The table below reflects business November business aircraft activity and shows a continued trend toward recovery and in fact a big boost.

et_graph2

TRAQPak data indicates November private jet activity increased 3.15% over the previous month (October 2009). Comparing November 2009 to November 2008, activity was up 22.7% with the large cabin jet sector leading the improvement at 28.1%, with the PT 135 (charter) market segment showing the strongest overall results at 34.1% above November 2008.

In other words, for luxury marketers who want to score big sales, the Big Fish are biting. Time to get the pole and go fishing!

Out of the Box: Looking for new and innovative ways to efficiently and cost-effectively target potential customers? Combine the only worldwide audited magazine aboard private jets, Elite Traveler, with an innovative destination specific campaign in private jet terminals, including events, and get to these consumers as they narrow their consideration set through Elitetraveler.com. You can find all the tools you need at www.elitetraveler.com/business.

2. Terrorism Scares, Bad Weather Boost Private Jet Flying

There are two interesting facts about private jet users most people don’t know. Virtually nobody goes straight from commercial travel to regular private jet travel, but most private jet travelers also fly commercially from time to time depending on their mission. For example, small and medium size jet owners use commercial airlines for intercontinental flights since their jets don’t have nonstop trans-Oceanic range, and even sometimes, for a domestic hop, say a quick day trip from New York to Boston, the shuttle might make more sense than getting the G-V out of the hangar.

That said, two variables that always drive up the portion of private jet trips one makes are the prospect of cancelled flights due to weather and incidents like the recent terrorist attempt Christmas Day on a Northwest Airlines flight from Amsterdam to Detroit, and the airport security delays and debacles that have followed.

According to a report in NewJersey.com, “a private aviation analyst says bottlenecks at airport checkpoints amid heightened security concerns are likely to continue for some months,” which will benefit private jet business.

“Those [travelers] who left for financial reasons may have another good reason to come back to business aviation if they can afford it,” said Brian Foley of Brian Foley Associates in Sparta.

According to the report, commercial carriers have been telling passengers this week to get to the airport an hour earlier than normal because of heightened security concerns. That just might add to the appeal of hopping on a private jet.

“When flying privately you are not frisked, and you don’t have to get there two hours early,” Foley said.

At Elitetraveler.com, we provided exclusive reports and interviews with operators of leading private jet companies in the wake of the Detroit incident:

While several executives of private jet companies believe the adverse publicity surrounding traveling on commercial airlines will help sales in 2010, “there were no marked increases in flight requests,” the Jet Aviation spokesperson added.

Instead, winter storms combined with late travel plans and increased marketing efforts have spurred a spike in private jet flights over the Christmas holiday.

“We’ve had a very busy flying season for the holidays this year so it’s a bit hard to notice an increase due to just the Northwest flight issue, especially since weather has been driving last minute bookings pretty much everywhere,” Steve Hankin, CEO of private jet charter and jet card company Sentient Jet told Elite Traveler.

“That incident (the Northwest flight from Amsterdam to Detroit) just reinforces the differences between private and commercial travel,” Woody Harford, Executive Vice President and Chief Revenue Officer of CitationAir told Elite Traveler. However, he added, his company’s increase in business has been “a result of our relaunch more than any commercial incident.” In the fall the operator changed its name from CitationShares to CitationAir by Cessna, followed by a major marketing blitz.

Ricky Sitomer, CEO of BlueStar Jets, a charter broker of private jet flights and a seller of jet cards, said his company had seen a “huge increase because of the snowstorm.”

Delta AirElite Business Jets, a separate subsidiary of Delta Airlines, has seen demand climb. “We have seen an increase in holiday travel. We cannot directly attribute any of the increase to the commercial flight incident,” spokesperson Rebekah Biddle said.

National Business Aviation Association (NBAA) spokesperson Dan Hubbard added, “If businesspeople need to travel from towns not served by the airlines; if they need to reach several destinations in a single day; or, if they need to transport items not easily delivered on the airlines, they may find that business aviation is the most prudent means of transport. These were the factors businesspeople took into account following the terrorist attacks of September 2001, and we believe the situation will remain the same in the months and years to come.”

Private jet travel saw a significant increase in November with a 22 percent year over year jump in flights according to industry tracking company ARGUS.

While the world’s economy today is unsteady, one thing is for sure: The wealthy consumers flying aboard private jets are your best bet, and only Elite Traveler delivers these elite travelers to our advertisers through our BPA audited circulation aboard private jets in over 100 countries, including Russia, the UAE, Kuwait, Qatar, Bahrain, Oman, India, Singapore, Korea and China. All with one ad buy!

3. December Jobs Data Show More Pain for Mass Affluent Sector

Luxury marketers who were thinking they might want to reach out to the Mass Affluent in 2010 probably need to go back to the drawing board and think higher.

A recent report in The New York Times outlined that both real job losses and fear of job losses continue to grow, putting a crimp in spending on non-essential stuff (think anything beyond mortgage, car, school, credit card debt, home repairs, a deeply discounted weekend trip, movies or casual dining).

Under the headline “U.S. Job Losses in December Dim Hopes for Quick Upswing,” Peter Goodman wrote: “The nation lost 85,000 jobs from the economy in December, the Labor Department reported Friday, as hopes for a vigorous recovery ran headlong into the prospect that paychecks could remain painfully scarce into next year.”

The article continued:

“We’re still losing jobs,” said Dean Baker, co-director of the Center for Economic and Policy Research in Washington. “It’s nothing like we had in the free fall of last winter, but we’re not about to turn around. We’re still looking at a really weak economy.”

Putting a scare into the Mass Affluent who have already seen their ranks thinned as friends as neighbors have lost jobs, had little success finding new jobs at equivalent pay, the article pointed out, “Most economists assume the unemployment rate – which held steady at 10 percent in December – will worsen in coming months.

“Mark Zandi, chief economist at Moody’s Economy.com, forecasts that the unemployment rate will reach 10.8 percent by October. The so-called underemployment rate – which counts people who have given up looking for work and those who are working part time for lack of full-time positions – now sits at 17.3 percent.

“Mr. Zandi argues that the economy requires an additional $125 billion jolt of stimulus spending on construction projects and aid to state and local governments – a proposal that confronts enormous political challenges.

Republicans assert the first dose of stimulus spending has been squandered on dubious projects. The Obama administration, increasingly concerned by the size of federal deficits, is loath to spend more.

Mr. Zandi argues that a failure to spend now to spur growth could leave the United States in a bigger hole.

“If we don’t do it and we slide back into recession,” he said, “that’s going to exacerbate the deficit even more.”

“…But millions of people still grappling with the bite of the worst downturn since the Great Depression have exhausted their patience – along with their savings and confidence.

“In Charlotte, N.C., Kumar G. Navile, 33, says he has applied for 500 jobs in the year since he lost his position as an engineer.

“For those out of work, the market is bleaker than ever. The average duration of unemployment reached 29 weeks in December, the longest since the government began tracking such data in 1948.

“For years, households spent in excess of incomes by borrowing against the value of homes, leaning on credit cards and tapping stock portfolios. But home prices have plummeted, stock holdings have diminished and nervous banks have sliced credit even for healthy borrowers, leaving the paycheck as the primary source of household finance. “… in coming months…the economy will confront stubborn challenges – cash-tight households curtailing spending, banks reluctant to lend and businesses unwilling to hire.”

Only Elite Traveler can guarantee you that your ad dollars are reaching wealthy consumers who are still spending. What do we mean? Our new June 2009 BPA Circulation statement breaks out where our magazine goes – 71 percent of our copies to private jets and private jet terminals, 14 percent to First Class lounges, 3 percent go to Sport Locker Room/Training Facilities and Yachts, etc. This means you know that your dollars are getting to consumers who are still traveling in style, and still spending money – not sitting home worried about the economy. It is a guarantee that your critical advertising dollars are reaching a lucrative target. It is a guarantee no other publisher can provide.

4. In Hawaii, Obama and Private Jets, but Room for More

Hawaii, despite its natural endorsement from President Obama, remains behind the curve in targeting the Ultra Wealthy. Yet many still come. As areas for private jet parking filled to capacity over the holidays from Los Cabos, Acapulco, Puerto Vallarta, Cancun to the Virgin Islands, St. Maarten (gateway to St. Barths), Anguilla, Nassau in the Bahamas and other desirable places that seek to attract Ultra High Net Worth individuals, Hawaii continues to suffer as its marketing efforts at both state and island levels continue to focus on the credit crunched Mass Affluent with deals that while desirable still are not affordable when mortgage and car payments are months past due.

Targeting the Mass Affluent in traditional markets such as Southern California, Nevada and Arizona where real estate data shows more homeowners underwater is hardly likely to provide much relief for Hawaii’s suffering tourism industry.

Yet at her front door, there is plenty of evidence like the President, Hawaii is well suited for the elite traveler.

A recent report for the Associated Press cited “138 exclusive personal planes landed at Kona International Airport on the Big Island – down 18% from December 2008.” According to the report, business remained strong with the Super Rich despite “the economic doldrums” and “haven’t…stopped the wealthy from returning for the golf and sun.”

Chauncey Wong Yuen, the Hawaii District manager for the state Department of Transportation’s airports division, said there were 51 private planes on the Kona airport apron as of Monday. But unlike other airports in elite destinations that were seeing an upturn over 2008 and finding their tarmacs full to capacity, even forcing jets drop their passengers off and fly to other airports for parking, there was space available in Hawaii: The airport can accommodate up to 61 private planes at a time.

Parking and landing fees are calculated based on plane size so at a time when state revenues are being hit, valuable dollars were lost to other destinations.

Two great examples of competitors that are successfully targeting the Ultra Wealthy travelers who fly by private jet are Mexico and The Bahamas. In fact Mexico has created a micro-site specifically targeted to private jet travelers, while the Bahamas recently created both a print and online guide, again specifically written and edited for Ultra High Net Worth individuals.

While the world’s economy today is unsteady, one thing is for sure: The wealthy consumers flying aboard private jets are your best bet, and only Elite Traveler delivers these elite travelers to our advertisers through our BPA audited circulation aboard private jets in over 100 countries, including Russia, the UAE, Kuwait, Qatar, Bahrain, Oman, India, Singapore, Korea and China. All with one ad buy!

5. The Independent – Margareta Pagano: The Super-Rich Still Rule our Economy

The following article is from the U.K. based newspaper, The Independent.

“In this season of grand and gloomy forecasts, retail experts are unusually united in predicting carnage on the high street but they are slower to agree about the future of shopping for the super rich.

You might ask, at a time like this, whether we should even care but I’ll get to that later. The crash in the sales of designer handbags has been widely interpreted as a sure-fire indicator that things are really serious for the super rich. At the top end of the market things are more complicated than that.

Examine Covent Garden’s Kraken Opus, a 4,000sq ft shop – or should I say shrine – devoted to selling the most expensive books in the world. Prices start at around £3,000 and go up to £20,000. For this you get a book bigger than the average coffee table, packed with signature shots by the world’s top photographers and illustrated by some of the world’s top artists.

The books weigh about 35kg each and measure about half a meter. Kraken claims to provide: “Greatness immortalized greatly.” And they feature celebrities like footballer Diego Maradona and fashion designer Vivienne Westwood, as well as covering The Saatchi Gallery and Formula One. At auction in Dubai, one collector paid $1.6m (£1.08m) for the Manchester United Opus.

Kraken’s founder, Karl Fowler, says demand for his extraordinary books is enormous – he would, wouldn’t he? – but Fowler says this is a great time to expand and plans to open another 12 shops this year. Previously, the books had been available only by word of mouth – bought by that new global nobility: a second generation of the super-rich who never travel “commercial” when they flit from capital to capital.

Another London shop they visit is Zilli’s, the French luxury high-end menswear retailer on New Bond Street. Zilli’s has just finished the best two months trading since it opened more than 20 years ago. Its hand-made cashmere and chinchilla coats sell for £8,000 each and they have been walking out of the door. But Zilli’s best customers are not regular shoppers “renewing their wardrobes” but visitors from the Middle East and Russia.

There are implications of this kind of elite spending that reach further than the style page of glossy magazines. While it might be irritating to admit that the trivial shopping decisions of a handful of the super rich have any real significance for the global economy, they cannot be ignored. It is a fact that the buying power of this new global nobility has assumed more than a mythical status when it comes to creating wealth. Zilli’s £8,000 cashmere jacket, for example, supports 300 jobs in Lyons, where the garments are hand-stitched, and the staff in its shops.

The big question being asked by analysts, though, is how visible this tribe will be over the coming months and to what extent it will be hit by the economic downturn. Oil prices have tumbled, hurting some of this elite, while the financial crisis is forcing others to reschedule their debt and rejig their empires, though there is still big money around. (And those with the money are still on their private jets leaving those who lost it grounded and stuck in the airports with the rest of us).

More importantly (and more than they care to admit) the industry analysts who are so quick to go public on the death of the high street are privately spending a great deal of their time tracking the habits of these exclusive tribes. They are in no doubt about the link between their future and ours.

Out of the Box: Looking for new and innovative ways to efficiently and cost-effectively target potential customers? Combine the only worldwide audited magazine aboard private jets, Elite Traveler, with an innovative destination specific campaign in private jet terminals, including events, and get to these consumers as they narrow their consideration set through Elitetraveler.com. You can find all the tools you need at www.elitetraveler.com/business.

Websites in our network
NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. Be the first to know about the latest in luxury lifestyle news and travel.
I consent to New Statesman Media Group collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED
Thank you

Thank you for subscribing to Elite Traveler.