The Buying Power of UHNW Women with Lynn Raynault, Vice President of Global Marketing for Wealth-X.
Explore and learn about the driving forces of this coveted demographic and how you can tap in.
It comes as no surprise that the female UHNW demographic is an authoritative buying power. The average UHNW individual spends around US$1.1 million a year on luxury goods (across all categories eg. travel, art, automobiles, etc). Lynn Raynault is Vice President of Global Marketing for Wealth-X, the global authority on wealth intelligence. She is responsible for leading the firm’s global integration of marketing and communication platforms. Before joining Wealth-X, Lynn was Vice President of Marketing at Sotheby’s, leading the marketing and branding strategies for all North American auctions. She has also worked in various senior brand management, marketing and innovation positions at Dutch brewer Heineken, Scottish distiller William Grant & Sons, and L’Oreal USA. In this article, Lynn shares her research and findings on the driving forces of this coveted demographic and how you can tap in.
The Importance of Technology and What Luxury Brands Catering to this Market Must Embrace
Technology today is highly important for brands to stay relevant and connected. Staying relevant with the UHNW consumer can only come after a brand builds an initial relationship, which most often happens off-line. However, brands – particularly in the personal goods space – are trying to bridge the gap between offering the same level of service online as they can in their stores. Brands that target the VIP/UHNW category need to build the initial relationship before relying solely on digital communications. Net-a-Porter is a great example of a digital business that has successfully created the service levels of an off-line experience.
In terms of tech trends, we see rapid wealth creation from the tech companies. However, the net worth of the women on a Wealth-X list released this spring shows women still lag far behind their male peers in the technology sector.
Countries that Demonstrate a Rise in Female UHNW Buying Power and Top Markets
At the very top of the spectrum, the top 3 countries with self-made female billionaires are: the United States (41%); China (22%); and Hong Kong (9%). There are nearly 1,700 UHNW individuals with a total wealth of US$190 billion in China. The average age is 50 with about 20% of wealth being generated from manufacturing. About 9% of wealth is invested in real estate & luxury assets. The United States continues to be an important luxury market. Global luxury CEOs, according to a recent Wealth-X/Departures recent, remain confident of the growth of the luxury goods market, estimating an average sales growth of 11% for 2015.
Maximizing your Brand Presence within the UHNW Demographic
Engaging with this segment requires a one-to-one approach. While large brand advertising does well to create awareness and share of mind, marketing to the UHNW woman requires you to know who she is and create personalized experiences for her. We have seen brands develop concierge programs that are highly effective, with an individualized approach, even developing unique products.
Buying Patterns, Behaviors and Interests
About 30% of female UHNW individuals have art as their second most favored hobby after philanthropy. There are about 28,000 UHNW women (UHNW is defined as having assets greater than $30 million) globally with total wealth at over $4 trillion who are seen to be investing more and more in luxury assets such as real estate and art.
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Female UHNW individuals tend to favor real estate and luxury assets, holding almost 16% of their total net worth in such assets, compared to their male counterparts who hold less than 10% in those two categories. As the number of self-made UHNW women increases, these categories will benefit. Already, in the art world there is a growing number of female gallerists and nearly a quarter of Sotheby’s Board of Directors are female.
Future Predictions for the UHNW Female Demographic
Children of wealthy parents, who have grown up with philanthropy and art as an interest, will also begin to change the age of wealthy women. We anticipate the largest transfer of wealth coming in the next ten years.