Written By: Scott Koepf, Vice President of Strategic Development – Cruise Planners
As I noted last month, knowledge of the affluent/luxury customer may be even more important than knowledge about the luxury products, so review the below information about your potential customers. If you want to sell high end travel (yes, that means travel products who pay commissions with commas in them) you must start by knowing who they are and where to find them. Once you find them then the work begins to qualify them while also establishing trust, which is especially key for these clients. The sales process that I have outlined in detail through these articles does not change for affluent customers, it simply requires more time and effort spent on each step of the process. The below information is not provided to pigeonhole consumers but to provide some information on who they are and where to find them. From there it is up to you to truly get to know your customer and what they are looking for.
Categories of Affluent Customers:
- OLD RICH Crave Image & Elitism
- NEW RICH Entrepreneurs
- WOULD BE RICH Debt fuels spend more than income
- THRIFTY RICH Millionaire next door
- SPECIAL OCCASION RICH Spend 2.5x’s more on single event
Source – Bruce Tepper
- ELITE LUXURY LOVER Crave exclusivity & being cocooned
- ASPIRING LUXURY LOVER Younger, status driven, brand conscious
- SAVVY LUXURY SHOPPER Know & want best-on sale
- LUXURY EXPLORER Unusual/adventure but comfortable
- SATISFIED LUXURY ADMIRERS Understand it but won’t spend for it
- YOUNG & RESTLESS LUXURY LOVERS New, Demand information, reject hype
Source – Larry Pimentel
Demographics of Affluent Customers:
“The acquisition of wealth is progressing at an unprecedented pace, with increasingly more consumers gearing up to luxury purchasing. In the U.S. alone, the number of people with over $1 million in liquid assets (excluding home/retirement funds) is approaching nine million, equating 3% of the population. This segment of the population is growing seven times faster than any other segment.”
56% of the affluent are women and 63% are first generation wealthy.
The Affluent spend 12% of after-tax income on travel.
The next generation is set to inherit over $5 trillion.
“A generation of savers are transferring their wealth to a generation of spenders.”
-Kathy Sudeikis – Past ASTA President
The wealthiest 10% of Americans is comprised of eleven million households who represent 50% of consumer income and spending and 33% of the US economy.
- American Affluence Research Center (AARC)
Psychographics/Behaviors of Affluent Customers:
“Luxury travelers are brand loyal; once they find a brand they like, they tend to remain loyal as long as the brand offers high quality and good value. Luxury travelers appreciate value (quality and excellence) more than price. Luxury travelers believe strongly in the third-party endorsement. Luxury travelers have a remarkable capacity for separating informed opinion from hype. It is one thing to capture a customer’s pocketbook, but the real goal is to capture their heart.”
– Larry Pimentel
- 68% of the affluent go online daily but friends and acquaintances are the primary influence.
- Affluent are 6 times more likely to buy a cruise
- Top two reasons for travel are relaxation and indulgence but education and unique experiences are climbing fast as are adventure, active and sports/fitness travel
-Amex Platinum survey
- Travel defines them and they like recognition, exclusivity
- More casual than expected and want to meet people like them
- The gap between vision and reality is less for the affluent
- Affluent Lifestyle customers are more likely to be involved in the following:
Real Estate Investments, Stocks & Bonds, Foreign Travel, Golf, Tennis, Wines, Cultural/Arts, Fine Arts, Snow Skiing, Belongs to Private Clubs