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Elite Traveler – ET Insider – July 28, 2009

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ET Insider – July 28, 2009

Elite Traveler Insider –

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July 28, 2009

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. Framing the Super Rich for Big Bucks

2. Fighting Discounts With Unique Experiences

3. An Advertising Guarantee: Reaching Readers Who Can Buy Your Product

4. Tales from the David Divorce: The Super Rich Make Good Customers

5. Mass Affluent No Longer Lust for Luxury: Unity Marketing

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. Framing the Super Rich for Big Bucks

I always enjoy hearing when folks talk about how the Super Rich have cut back on spending. While there is no doubt they are more discerning about what they buy, the bottom line is that the Ultra High Net Worth Individuals are the ones who still have the money to make significant luxury purchases. Those Super Rich folks on private jets are still living the private jet lifestyle, and last week I made a stop on New York’s Upper East Side that re-enforced the message that for companies with the right product, the market is there.

Eli Wilner sells both antique and reproduction frames. A typical customer spends $100,000 on their initial purchases, which could be a single frame, although price points start at slightly under $10,000. Many customers spend millions over the course of a couple years, and of course, the money they spend on what goes in the frames is even higher.

So how is Eli Wilner doing? Below is a quick rundown of sales he has made in the past couple months:

CK recently purchased an oil by Picasso for $2.1 million and then framed it with a period frame for $65,000

RB recently purchased a gouache by Fernand Léger for $300,000 and selected a $22,000 replica frame for it

GF recently purchased an oil painting by Andrew Wyeth for $5 million and selected a $28,000 replica frame for it

HM recently purchased an oil painting by John Frederick Kensett for $100,000 and selected a $ 32,000 period frame for it

WS recently purchased an oil painting by Claude Monet for $3.4 million and selected a $58,000 period frame for it

CA recently purchased a photograph by Robert Frank for $25,000 and selected a $12,000 replica frame for it

BT recently purchased an oil painting by John Singer Sargent for $1.2 million and selected a $60,000 period frame for it

FT purchased a watercolor by Winslow Homer for $400,000 and selected a $24,000 replica frame for it

As Eli pointed out when we were chatting, there are still a lot of rich people out there, and those people who have money are spending it when they want to. Sounds like a dream for savvy marketers!

Elite Traveler’s BPA audited circulation aboard private jets and mega-yachts in over 100 countries means your ad is guaranteed to reach the highest spending luxury audience in the world no matter where they are from and where they happen to be today – each issue is read by 407,000 readers with a Household Income of $1 million +, the highest of any magazine or newspaper in the world! Sources: 2007 Prince ET/MMR for others

2. Fighting Discounts With Unique Experiences

Perhaps it helps to have Japanese ownership who take a long-term view. Halekulani Corporation Chief Operating Officer Peter Shaindlin said the advice from his Board of Directors was “Don’t fire a busboy to save a few dollars and ruin a reputation that’s taken 25 years to build.”

Watching over the iconic Halekulani on Waikiki in Hawaii, Shaindlin compared his stewardship to the famous Patek Philippe ads with father and son where the tag line is: “You never really own a Patek, you just look after it for the next generation.”

So with that long-term view, the hotel and Shaindlin are rolling out a new, ultra exclusive dining concept called Table 1, overseen by new Executive Chef Vikram Garg who, like Shaindlin, is a Rosewood alum.

Table 1 is a prominent “see and be seen” table at Orchids, a restaurant in the hotel. Seating from two to eight, guests can design their own menu with Garg or alternatively let him offer a chef’s surprise.

Shaindlin noted by making the concept exclusive, many nights have already been booked.

On the accommodations side, instead of focusing on discounts, again Shaindlin and his team are trying to create unique experiences. The new Orchid Suite (named in our July/August issue as one of Elite Traveler’s 2009 101 Top Suites) like the Royal Suite and Vera Wang Suite, is priced at $7,000.

In addition to the normal room service menu, each suite has a special menu conceived by Garg and La Mer (the Halekulani’s top rated French restaurant) Executive Chef Yves Garnier.

Moreover, since each suite has a small kitchen, guests are offered the option of having dinner personally cooked en suite by either Garg or Garnier. The Orchid Suite with a private lawn also offers the option of dining al fresco to the sound of Waikiki’s surf.

The suite also has a $150,000 Steinway Lygendorf home theatre system that turns the volume down when the doors to the terrace are opened; a program called Art in Motion enables guests at the three top suites to have use of a Lotus, Bentley or Maserati, with or without driver, during their stay.

The result of creating unique lifestyle products, says Shaindlin, is that The majority of guests in the suites are new to the hotel. He noted the Vera Wang suite has improved the hotel’s profile in New York, where Wang is well known in the social and fashion circuits.

“It’s a good time to be innovative, and of course, we are very focused on substance and style, respecting our tradition,” Shaindlin said over a recent lunch in New York at the Core Club to introduce Table 1.

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. An Advertising Guarantee: Reaching Readers Who Can Buy Your Product

Here’s the problem with some of the publications that may have worked for you in the past: They really don’t know how well or badly their readers are doing. They may have research, but that research is based on a sample that probably is made of less than One Percent of their readers, so it is hardly dependable.

Here’s the rub. If a magazine charges $12 or $65 for an annual subscription of 12 issues, it is impossible to tell how many of those subscribers have been laid off, are facing potential unemployment, have had their compensation cut, or like many of the Mass Affluent, simply hunkered down and not interested anymore in the Luxury category. The same applies for magazines driven by charge card bases. The billions of dollars being written off by banks for delinquent accounts is just the tip of the iceberg, and really underscores that what worked last year may be a dud today.

That’s a thought that certainly concerns any luxury marketer at a time marketing dollars are more precious and everyone wants to make sure their dollars are reaching prospects. As one CMO told me last week, “branding is a bad word.” I did add that branding is still a good thing, in my opinion, if it is to true prospects, not the Aspirational audience which both LVMH Chairman Bernard Arnault and Neiman Marcus CEO Burt Tansky have said is in hibernation.

So why I am happy despite the bad media environment? If you think about Elite Traveler’s BPA audited distribution aboard private jets and in private jet terminals, it guarantees our readership is always that segment of the population that is still doing exceptionally well no matter what’s happening to the rest of us.

What do I mean? If you were Super Rich last year, you lost all your money, had to sell your jet, you are no longer our reader. But then again, you are no longer a very good prospect for luxury marketers.

The point is that those folks who are on the jets today are doing well and still living the private jet lifestyle, and Elite Traveler puts you front and center with them.

The other point I am proud about is that we have neither dumbed down our Editorial, nor have we lowered the standards of the ads we accept. I always say that when you advertise in Elite Traveler you are never going to feel your stomach churn when you see ads near yours from K Mart, Wal-Mart, KIA, Hotels.com, Courtyard by Marriott, dog food, cat food and other companies not in your league. After all, isn’t luxury somewhat about the company you keep? When’s the last time we saw an Hermès store in a housing project?

The same goes with our Luxus marketing programs focused on private jet terminals. What a great environment, where every prospect you meet is flying by private jet. You no longer have to wonder if they came just for the free drinks. And from an advertising perspective, the back lit Duratrans provide two key attributes: They’re impossible to miss, and as most terminals only have two or three displays, they are extremely exclusive.

If you want to make sure your marketing dollars are hitting the target, drop me an email at douggollan@aol.com or peruse our media kit at www.elitetraveler.com/business.

Elite Traveler’s BPA audited circulation aboard private jets and mega-yachts in over 100 countries means your ad is guaranteed to reach the highest spending luxury audience in the world no matter where they are from and where they happen to be today – each issue is read by 407,000 readers with a Household Income of $1 million +, the highest of any magazine or newspaper in the world! Sources: 2007 Prince ET/MMR for others.

4. Tales from the David Divorce: The Super Rich Make Good Customers

It’s expensive to be rich. While it is often hard to quantify how much Ultra High Net Worth Super Rich folks spend, divorces sometimes provide an opportunity to look inside their spending.

So it was with the divorce of Marie Douglas-David, the 36-year-old Swedish countess who divorced her 66-year-old husband, George, the Chairman of United Technologies. Between the couple, they had six homes on two continents and a yacht. I guess that would be a problem for a normal subscription magazine; which home would it go to? At any rate, we know Elite Traveler is there for the David’s in their jets and jet terminals.

Marie Douglas-David’s weekly expenses:

Clothes $4,500 Hair and beauty $1,000 Eating out $1,500 Travel $8,000 Limousine service $700 Personal assistant $2,209 Horse care $1,570 Flowers $600

Total: $20,079

George David’s weekly expenses:

Clothes $2,500 Yacht maintenance $95,943 Eating out $1,773 Travel $7,491 Charities $18,042 Entertainment $7,125 Wife’s residences $67,126

Total: $200,000

Keep in mind the above are current figures. Doesn’t sound like the recession has hit the David’s, which I would say is good for the hotels they frequent, their florist, clothiers and others they provide patronage to!

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. Mass Affluent No Longer Lust for Luxury: Unity Marketing

Even if Mass Affluent consumers in the U.S. start to feel better about their lots in life, Unity Marketing’s Pam Danziger says, “Marketers can’t afford to be over confident right now… Affluent consumers’ expectations of future luxury spending continue to lag behind other indicators that make up the LCI index. Further Unity’s research shows that affluent consumers’ basic attitudes and motivations that underlie their patterns of consumption are changing, and these changes are likely to outlast the economic downturn.”

Median Household Income of the survey sample was $204,000, from a comparison standpoint, slightly higher than readers of Robb Report or Departures and approximately $50,000 more than Mass Affluent publications such as Town & Country, Conde Nast Traveler, Travel + Leisure, Forbes, Architectural Digest and the like. The Median HHI of Elite Traveler, by comparison, is over $2.2 million, some 10 times higher.

Commenting on the results of the latest survey, Tom Bodenberg, Unity Marketing’s chief economist says, “As more and more American families feel the negative effects of recession, the idea of ‘luxury’ and the ‘luxury lifestyle’ is assuming a negative connotation. So while some affluents will relieve pent-up demand for luxury goods as a vehicle of lifestyle aspiration and expression as the recession ends, the media’s focus on ‘recession chic’ — personal expression that deliberately excludes luxury goods — may leave a lingering distaste for conspicuous consumption and parading luxury labels.”

Danziger concludes, “Now is the time for luxury marketers to do their homework, dig into the data and devise realistic and achievable marketing strategies for their businesses after the recession.”

Elite Traveler’s BPA audited circulation aboard private jets and mega-yachts in over 100 countries means your ad is guaranteed to reach the highest spending luxury audience in the world no matter where they are from and where they happen to be today – each issue is read by 407,000 readers with a Household Income of $1 million +, the highest of any magazine or newspaper in the world! Sources: 2007 Prince ET/MMR for others.

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