ET Insider – July 2, 2007

Elite Traveler Insider –

July 2, 2007

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.

CONTENTS:

1. Ferragamo Looks to Super Rich for Continued Success…

2. Elite Traveler Sets Record for July/August Issue…

3. Report from Pitti Immagine Uomo: The Sky’s the Limit…

4. 2007/2008 Media Planning Alert…

5. Private Jets Fly High in Paris…

Does Elite Traveler work? Two readers of Elite Traveler just made real estate purchases with Ginn Sur Mer for over $15 million!

1. Ferragamo Looks to Super Rich for Continued Success…

As Salvatore Ferragamo continues on a roll with the launch of high-end mechanical timepieces, Michele Norsa, the Italian luxury brand’s CEO, notes that the global economy and a new generation of Super Rich are making marketing more complicated.

First, the super wealth is coming mainly from self-made individuals, meaning they don’t have the same connection to luxury brands as those with inherited wealth, where son after father shopped at the same houses. Moreover, these Super Rich are just learning luxury. He notes, “In one of our stores there can be an elegantly dressed gentleman and another man in cut off jeans. It might be the man in cut off jeans buys 10 times or more as much as the elegant gentleman.”

The dapper Norsa also notes that worldwide travel means marketing is now a global exercise. As an example, Asia accounts for 46 percent of sales but Asian-based customers account for 55 percent of charges that can be tracked (cash sales can’t always be traced to country of the purchaser whereas credit card sales can).

He points out that buying when traveling is natural, particularly for men. “Most men won’t say on a Saturday afternoon, ‘I am going to go shopping.’ But maybe he has free time when he is traveling on business and he will shop.” Norsa notes Ferragamo has six stores in Tokyo’s Narita Airport alone, a prime entry point for travel to China and a good place to catch these moving targets as they await their next flight.

With shoes that range up to $10,000 and briefcases that are priced even higher, Norsa is now trying to dig deeper into the wallets of his wealthy customers via a licensing agreement with Timex Group for the production and distribution of a new collection of high-end timepieces.

The deal was announced at its historic headquarters in Palazzo Spini Feroni in Florence. In a private interview with Elite Traveler, Norsa noted that while he will offer limited editions with prices ranging up to 30,000 Euros, the core of the line will be from about 1,000 to 5,000 Euros which will be impulse purchases for elite travelers as they traverse the globe. Starting in November, 80 of the company’s boutiques will sell the preview collection.

Using timepieces to introduce Ferragamo to new affluent customers Norsa will bring his group to the Basel Watch Fair in 2008 as he seeks to sell his watches through top retailers. Eventually, he believes as much as 85 percent of timepiece sales will be via wholesale channels, meaning that he can touch new wealthy customers who may not have previously shopped in Ferragamo.

He believes by aligning with key watch retailers he will draw watch connoisseurs to the brand. “You can’t wear a 20,000 Euro watch every day and these people have multiple watches, so if they see it and like it, they will buy it. They can afford another,” he says.

Speaking again about the new generation of Super Rich, Norsa notes branding will be the key. Since today’s Ultra Affluent consumer may have grown up in a middle class household or in a country where luxury consumption is a first generation exercise, they aren’t necessarily familiar with luxury brands. “How many brands can somebody in China know? Maybe 10 or 12.”

Making sure Salvatore Ferragamo is known to these new Super Rich, Norsa believes, is essential to keep the house on its fast path and something he believes luxury timepieces will support.

Does Elite Traveler work? Elite Traveler delivers. Your leads are extremely qualified and we have closed a significant amount of business from your magazine. Jared Cullop – President, VPI Marketing

2. Elite Traveler Sets Record for July/August Issue…

With a gain of more than 50 percent over 2006, Elite Traveler’s July/August issue will be our biggest ever. Interestingly, summer is generally a time many luxury advertisers don’t advertise, and traditional luxury lifestyle magazines generally publish their thinnest issues of the year.

The reason is simple: Summer is a time the affluent tend to vacation and advertisers don’t want readers to miss their ads as magazines and newspapers pile up while people are away.

Conversely, luxury advertisers still need to sell as their stores remain open, and they need to start building momentum for the fall. And as the private jet lifestyle continues to get more press coverage (witness the recent front page coverage in The New York Times, The Wall Street Journal, The International Herald Tribune and extended segments on NBC Nightly News and ABC News), savvy marketers understand that the Super Rich are continually hopping from resort to villa to fourth or fifth home whenever they want aboard their private jets. Hence, Elite Traveler’s success.

With our BPA audited distribution aboard private jets in over 90 countries, Elite Traveler delivers some 429,000 Super Rich readers every issue no matter where in the world they happen to be or which locale they are hopping to in a particular week or month.

During the summer we offer additional opportunities for luxury advertisers to reach our Ultra Affluent readership. Extra distribution points along the Med spring into action as we place copies of Elite Traveler onto mega-yachts reaching the richest of the rich as they kick back and relax.

Our new, exclusive “Elite at Sea” program enables advertisers to place high-quality books and collateral onto mega-yachts during the summer; Lexus and jeweler Kwiat are two launch partners.

Kwiat Director of Marketing Bill Gould tells us, “We are delighted to take advantage of an innovative program like this that brings our brand closer to top customers and potential customers.”

Does Elite Traveler work? Ulysse Nardin sold “at least” two $86,000 Sonnerie en Passant watches from its ad in Elite Traveler’s January/February issue

 

3. Report from Pitti Immagine Uomo: The Sky’s the Limit…

With temperatures nearing 100 degrees late June in Florence, Italy’s top tailors were cool with cash at Pitti Immagine Uomo, the semi-annual trade fair of men’s fashion and accessories.

Stephano Ricci’s Niccolo Ricci spent over an hour proudly showing off his house’s uber high end accessories ranging from a $32,000 alligator wheelie with a matte finish (something you will probably never see on a baggage carousel at a commercial airport), new patterns for ties that retail at $340 apiece, an $11,000 python jacket and a $25,000 crocodile briefcase with gold and diamond buckle.

While these prices might provide sticker shock to those of us who pull down anything less than, say, half a million a year, the Ricci scion noted, “We have a customer who each time he comes into the store buys 250 shirts that go for $800 each.”

Of course the Florentine brand was hardly alone. Ermenegildo Zegna showed off numerous pieces in the $2,000 to $6,000 range along with its Vellas Aureum limited edition from its pick of top fleece. Each year only 40 suits are made, retailing for $14,000 each. President Bill Clinton has been reported to be a paying customer.

Gianluca Isaia’s Lauren Weiss noted that the distinctly young brand has top customers who spend over $250,000 per year with them, and it is not unusual for a customer to buy $50,000 at retail in a single shopping session.

Not missing a beat, Cesare Ferrari, the owner of Avon Celli pulled out a $5,000 gold and cashmere scarf “perfect for your readers” commenting, “Our customers don’t even ask the price.”

Luigi Martini, General Manager for Kiton in New York, arrived at Pitti a day late. He had been at the company’s Arzano factory outside Naples where a customer from the music industry had flown in on his private jet to take a look at where his order of 15 suits (all priced in the five-digits) were being hand-stitched by second- and third-generation artisans.

“I don’t sell suits, I sell the Kiton lifestyle,” Martini quips.

Whichever way you look at it, at a New York trunk show last year Martini found 10 owners for Vicuna and silk suits that cost $38,000 each.

And if the spending of this wealthy clientele was not enough to beat the heat, Ricci noted the customer profile is growing increasingly younger, predicting that there should be many years ahead for additional patronage. “Ten years ago our customer would have been 50 to 65. Today many of our customers are in their 30’s,” he said.

Does Elite Traveler work? Felix S. Sabates, Chairman of Trinity Yachts recently bought six Girard-Perregaux watches that he had seen in Elite Traveler.

4. 2007/2008 Media Planning Alert…

Effective advertising means reaching the right people at the right moment in the right environment. With some 429,000 readers who have an Average Household Income of $5.3 million, Elite Traveler provides the right readers for luxury brands; branding to these high spenders aboard a private jet is the ultimate in positioning.

To help you plan for the right moment, below is a list of increased distribution in conjunction with key events and hot spots for elite travelers. Remember, the Super Rich travel to and from these events by private jet; advertising in these issues is a great way to leverage any connection to these events you may already have, or just to make sure you have top-of-mind awareness with this lucrative readership.

Elite Traveler can also provide you bonus distribution of your promotional material onto private jets and at private jet terminals in conjunction with these events. Contact us for details!

September/October 2007 – Monaco Boat Show; Ft. Lauderdale Boat Show; National Business Aviation Association (NBAA) Annual Conference and Aircraft Exhibit; United Nations Annual General Meeting – New York; New York Fashion Week

November/December 2007 – Art Basel Miami; International Herald Tribune Modern Luxury Conference, Moscow; U.S. Rockies Ski Resorts (i.e. – Vail, Aspen, Sun Valley, etc.); St. Martin serving private jet travelers to St. Barts

January/February 2008 – Super Bowl; Miami Boat Show; U.S. Rockies Ski Resorts (i.e. – Vail, Aspen, Sun Valley, etc.); World Economic Forum, Davos; Dubai Air Show; NBA) All-Star Game, New Orleans; The Academy Awards, Los Angeles; Asian Business Aviation Conference and Exhibition (ABACE); St. Martin serving private jet travelers to St. Barts

March/April 2008 – Palm Beach Boat Show; Basel and Geneva Watch and Jewelry Shows; The Masters Golf Championship, Augusta, Georgia

May/June 2008 – Cannes Film Festival; Monaco Grand Prix; Las Vegas Watch and Jewelry Shows; Paris Air Show; EBACE – European Business Aviation Conference and Exhibition; Kentucky Derby; Wimbledon Tennis Championships; U.S. Open Golf Championship; Art Basel

July/August 2008 – Concours d’Elegance Auto Auction, Monterrey California; Mega-Yachts in the Med; Hamptons; The British Open Golf Championship; Major League Baseball (MLB) All-Star Game; Sardinia Yachting Season

September/October 2008 – Monaco Boat Show; Ft. Lauderdale Boat Show; National Business Aviation Association (NBAA) Annual Conference and Aircraft Exhibit; United Nations Annual General Meeting, New York; New York Fashion Week

November/December 2008 – Art Basel Miami; International Herald Tribune Modern Luxury Conference; U.S. Rockies Ski Resorts (i.e. – Vail, Aspen, Sun Valley, etc.)

Does Elite Traveler work? A reader booked the Presidential Suites at The Mandarin Oriental, Washington DC directly from the pages of Elite Traveler

5. Private Jets Fly High in Paris…

The Paris Air Show may be best know for its billion dollar orders of commercial airliners and the newest in military air defense, but with private jets taking their place as the fastest growing segment of the global aviation and aerospace industry, this year’s event focused on the elite segment.

A front page story the International Herald Tribune described lines of Super Rich waiting to view the newest private jet offerings as if they were “waiting” outside a Louis Vuitton boutique.

Texas Billionaire Robert Bass unveiled a plan he is backing for a supersonic private jets while rumors circulated about additional orders of private versions of the Airbus A380, the world’s largest airliner, which will hold up to 800 passengers in its commercial version.

Teal Group projects that this year, private jet manufacturers will deliver 999 private jets, up from 504 in 2003, and in the next 10 years, over 12,000 new private jets will enter service. However, those figures exclude the new Very Light Jets, of which there should be over 5,000, and commercial airliners like the A380 which are purchased for private use.

“The top end of society is the fastest growing segment of society. These are people who are willing to pay any price,” said Richard Aboulafia, an analyst at The Teal Group.

Needless to say, Elite Traveler enables luxury companies that want to be part of the lucrative private jet lifestyle to reach our 429,000 readers in over 90 countries every issue.

Does Elite Traveler work? A reader booked the Presidential Suites at the Mandarin Oriental, Washington DC directly from the pages of Elite Traveler.