ET Insider – June 19, 2007

Elite Traveler Insider –

June 19, 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. Virgin’s Branson Latest Billionaire to Endorse Private Jet Market.

2. Elite Traveler and Laura Hughes featured on ABC News and CNBC.

3. Patek Watch Set U.S. Record at $1.24 million.

4. Mortgage Meltdown Shows Mass Affluent Under the Gun.

5. Private Jets Set the Super Rich Free, Hotels Respond.

6. Palm Springs sees a surge in Private Jets.

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.

1. Virgin’s Branson Latest Billionaire to Endorse Private Jet Market.

We all know the Super Rich fly by private jet. Now billionaire Sir Richard Branson is getting into the private-aviation game with the launch of Virgin Charter, an online marketplace for matching travelers with companies that charter private jets or airplanes.

Branson follows the world’s two richest men —- Warren Buffet who owns Netjets and operates over 600 private jets based in the U.S., Europe and Middle East, and Bill Gates who is an investor in Eclipse, a manufacturer of air taxi jets that expects to produce several thousand small private jets in the next several years.

The new effort, which was announced last week, follows a successful effort by Sir Richard’s Virgin Group Ltd. to win government approval to operate a new low-cost airline in the U.S. However, Virgin Charter, of Santa Monica, Calif., is targeting a different clientele — people willing to pay tens of thousands of dollars more than airline tickets for the speed and convenience of private jets.

According to The Wall Street Journal, which first broke the news, demand for private jets has been rising fast, fueled by factors that include long security delays at airports. Hours flown by private jets rose about 41% to an estimated 3.9 million hours last year from 2002, according to the Federal Aviation Administration. It is a fragmented field, with an estimated 2,500 U.S. charter operators.

Of course Elite Traveler delivers the wealthy consumers who fly aboard private jets to our advertisers. We have 4,000 + BPA audited agreements in over 90 countries with private jet charter companies, corporate flight departments, aircraft management companies that manage jets for private owners, private jet terminals (FBOs), private jet caterers and others who place copies of Elite Traveler aboard the private jets of these ultra-luxury consumers. Each issue we deliver over 425,000 readers who have an average household income of $5.3 million, according to Prince Research.

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

2. Elite Traveler and Laura Hughes featured on ABC News and CNBC.

When ABC News and CNBC Power Lunch wanted an expert to speak about Father’s Day Gifts for the Super Rich, they called Elite Traveler’s Editorial Director Laura Hughes. Of course with over 425,000 readers who have an average household income of over US $5 million reading every issue, Laura and Elite Traveler have become to the Super Rich what Anna Wintour and Vogue are to the fashion industry!

See links below:

Laura on ABC News. http://abcnews.go.com/Video/playerIndex?id=3255669

Laura on CNBC Power Lunch. http://www.cnbc.com/id/15840232?video=378721944&play=1

Does Elite Traveler work? A reader of Elite Traveler recently made a four night, $40,000 booking at Soneva Gili!

 

3. Patek Watch Set U.S. Record at $1.24 million.

Elite Traveler Contributing Timepieces Editor Osvaldo Patrizi took the watch industry to new heights last week, selling a pink gold Patek Sky Tourbillon wristwatch on Thursday for $1.24 million, a record for a wristwatch auctioned in the United States.

The watch was sold at the summer auction in New York of Antiquorum, the leading international watch auctioneer, which raised nearly $8.6 million for the 289 collectible timepieces offered in the sale. Patrizi is chairman of Antiquorum.

Bids came from around the world, including Italy, Malta, Singapore, and the Netherlands, by telephone, room, Internet, and commission bidders. The results show that the United States has become important to serious watch collectors, said Julien Schaerer, auctioneer and watch director for Antiquorum USA.

Other Patek Philippe watches also did well at the auction. A yellow gold tonneau minute repeater (1992), with moon phase, perpetual calendar, retrograde date, and leap year display went for $383,600, while one from 1952 sold for $344,400. Two gold so-called “TV watches” (referring to case shape) together achieved a world record price of $232,400.

Among other top 10 sales were a rare Richard Mille Tourbillon Split-Seconds Chronograph ($299,600); an Audemars Piguet Royal Oak Concept watch ($232,400) and a Harry Winston platinum Opus 4 ($232,400).

Elite Traveler is enhancing its watch coverage even further with our September/October issue by adding a new column with a full page dedicated to small and innovative Swiss manufacturers. The column will be penned by Elizabeth Doerr, an internationally renowned writer covering the watch industry since 1991. Doerr is a regular contributor to 12 publications worldwide.

In commenting on the new column, Editorial Director Laura Hughes noted, “our average readers spend $147,000 per year on watches. They buy watches starting at several thousand dollars and ranging into the millions. Currently we cover accessible timepieces in our fashion shoots, we look at what’s new in our Watch Trends section by Paris-based Jessica Michault, and Osvaldo covers Collectible watches in his Horology column. This new editorial section will identify emerging watch makers. Who will be the next F.P. Journe or Richard Mille? We are very excited to take the lead in supporting the Swiss watch industry in cultivating emerging watchmakers and their companies.”

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

4. Mortgage Meltdown Shows Mass Affluent Under the Gun.

In the latest fallout from the housing market’s decline, disputes are breaking out between builders and buyers who signed contracts for new homes and condos when the market was hot — and now want to get out of them, according The Wall Street Journal.

Even as many of the new buildings are completed, buyers are filing lawsuits claiming they were duped into purchases they couldn’t afford, or victimized through fraudulent investment schemes. Some are scrutinizing their contracts looking for loopholes, or searching out tiny flaws in finished homes that might allow them to back out without losing their deposits.

For some builders, the disputes are contributing to cancellation rates as high as 30% and writedowns in some markets. “People will go to great lengths to get out of a legally binding transaction,” said Larry Sorsby, chief financial officer of one South Florida developer. “They were willing to ride the real-estate boom on the way up, but some are not willing to ride it on the way down.”

Consequently, some condo buyers are aggressively seeking ways to back out, said Brad Hunter, director of the South Florida region for Metrostudy, a residential real-estate market research firm. He expects more to do so in the next year as projects sold during the boom become ready for occupancy.

“If they can find some way in which the developer has not delivered according to the contract, they’re using that as a way to get out,” he said.

One of those buyers, Daphne Sewell, received three loans, totaling about $750,000, to buy three condos May 2005.

An administrative assistant in Broward County government, Ms. Sewell said she and her husband, a carpenter, earned $90,000 a year at the time of the deal and never should have qualified for their mortgages. She also claims a real-estate firm involved in the deal promised that it would find them tenants to rent out the condos. But the renters never materialized, her condos are vacant, and two of her loans are in foreclosure.

“If I close on them I deplete my savings in two or three months,” said Ms. Sewell. “It’s worth the fight.”

Ah, the joys of selling to Mass Affluent. Make sure you have a good lawyer on retainer and get ready for lots of depositions. As an aside, the wealthy readers of Elite Traveler spend over $500,000 per year on home improvements and own at least two homes valued at $2 million.

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, River Rock

5. Private Jets Set the Super Rich Free, Hotels Respond.

Unlike those of us who have to check airline schedules, private jets enable the Super Rich to make their own schedules. One day in Naples, Florida, the next in Naples, Italy — and the only time you have to take your shoes off is when you fall asleep.

Six Senses CEO Dan Reid recently told eHotelier that the continued entry of top-end resorts strengthened the Maldives’ position as a high-end holiday destination. “On any one day in the Maldives, there are typically four to eight private jets parked on the apron at the airport.

Prince Research shows the average Elite Traveler reader spends over $400,000 per year on hotels, resorts and spas, so it’s no wonder astute hotel operators are working more than ever to attract this market.

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

6. Palm Springs sees a surge in Private Jets..

Palm Springs in the California desert has always conjured up the image of private jets with lush private golf courses, luxury resorts, sprawling second homes and a healthy dose of Hollywood stars.

Recent reports note the private jet market is becoming so big that it has expanded beyond Palm Springs International Airport to Bermuda Dunes and Jacqueline Cochran Airport, two other airports in the Valley.

The previously sleepy Jacqueline Cochran airport is “full of private jets” according to a local newspaper report where two more hangars are being built. The Federal Aviation Administration reported that traffic jumped to about 76,500 annual flights in 2006 from 710 in 1976.

In a typical day, Tradition Aviation, an FBO at Cochran, services about 25 to 30 flights, but numbers can balloon during big events like the Skins Game around Thanksgiving or the Horses in The Sun equestrian event, with several hundred jets a day.

Who flies into and out of Palm Springs? The owners of Cochran-based Tradition Aviation rattle off stories, like the time they catered to three presidents in one day. Or how they became friends with actor John Travolta while he was in Palm Springs for several weeks learning to fly. They’ve befriended athletes such as hockey star Wayne Gretzky, astronauts and business tycoons. They were friends with President Gerald R. Ford and his wife Betty, with Bob and Dolores Hope, Frank Sinatra, Dinah Shore, Walter Annenberg and countless others.

Since starting Tradition Aviation, they’ve seen a steady flow of big names, although Nelson admits she doesn’t recognize them all like she used to. When Britney Spears recently flew in one day, Nelson had to be told who the pop star was.

Just when Goodwyn thinks she has seen it all, there’s another surprise. “I don’t get star-struck often, but . I came around the corner the other day and there stood Clint Eastwood,” Goodwyn said with a laugh. “You have to be able to contain your surprise.”

Palm Springs is just another example of how the private jet business is booming with three airports and some seven FBOs (private jet terminals) serving this high-net worth market. Elite Traveler ensures luxury marketers their message reaches this target with over 4,000 distribution agreements in more than 90 countries worldwide, including, of course, Palm Springs.