Identifying the needs and desires of denizens of the Ultra-High Net Worth (UHNW) economy is not for the faint of heart. It requires a leap of the imagination that considers factors well beyond those which Maslov described with his straightforward pyramid of the Hierarchy of Needs. The needs of the UHNW are at once more elemental and more nuanced. Consider for example, Freud’s hypothesis that we all crave ‘significance.’ As in, how does this most rarefied audience signal significance to itself and its peers? How, indeed! It will satiate itself beyond mere needs and fuel its desire propelled by its incalculable ability to fund any ‘lust stuff’ it believes it deserves as the ‘one percent of the one percent’ ecosystem.
How do you best understand the Ultra-High Net Worth? And the answer is: Talk to the people who work for them.
Pennywise
We embarked on such an exploration recently, although unable to use our signature regression/hypnosis methodology. These rich folks aren’t intrigued by a trip to a focus group facility, incentive gifts or honoraria. Not even a donation to favored charity lures them. Thus, we went into discovery mode through the next ring of their rarefied circles: their third-party fashion designers, interior designers, stylists, salons, personal trainers, private chefs, personal assistants, architects, luxury boutique hoteliers, private aviation and yacht builders and customizers, and managers of family wealth funds in this country and abroad. The net takeaway can be distilled into one key – and seemingly confounding – headline: The Ultra-Rich Are Pennywise and Pound Foolish.
How can we say that? The ‘thing behind the thing’ driving purchase decisions at these levels is their urgent push to prove themselves as exceptions to three prevailing social stereotypes of the ultra-rich: third-generation profligate and entitled scions of grandparents; bold, brash tech bros with more money than taste; and trophy spouses/partners. And what is that urgent push? To be deemed intelligent, even savvy connoisseurs of the best offers in a gorgeous world. And more importantly, that their personal intelligence is way too savvy to pay for life’s boring necessities in the typically boring way others must. Life is to be designed rather than led and must be bespoke in distinctive ways which contribute to their narrative storytelling describing their remarkable life experience. Each element propels their story into the world of what our research terms ‘the great and unrivaled uniqueness of me.’
High-Low
They regale at elegant dinner parties with the joys of the Costco meat department transformed by the exotic route of these massive beef, pork and lamb carcasses hauled by their staff from the store’s parking lot to their private butcher. Final destination: the restaurant grade meat freezer in the basement of their suburban villas. We found this private butcher revelation more interesting than any focus group discussion among the elite on prestige grocery. Ditto the story of how a personal assistant created a spreadsheet to track points awarded for various airlines through a mind-numbing assortment of American Express perks. The backstory is the family traveling by private jet to Klosters and the nanny arriving later in first class. With a bit of pressure and the payment of a retainer, the interior designer charges only ‘to the trade’ prices on select items. Or how in exchange for inclusion a Town & Country feature on them in their Palm Beach home, the tiny type credits include the names of their hair and make-up professionals who provided services ‘for free’
This ‘reverse name-drop’ is the pennywise side of the coin. Mere mortals may discuss getting a great deal at Burlington, DSW, the death throes of Saks Off Fifth, the close-out racks anywhere, the BOGOs (buy one, get one free) everywhere. They have been trained by a generation of retailers to confuse ‘discount’ with ‘smart.’
The penny-conscious wisdom of the truly wealthy operates in a different sphere, tuned to a different frequency. It’s not enough to search for a good deal. For the Ultra-High Net Worth wealthy, the deal is being wise in search of the exquisite. The other side of the coin, e.g., the foolish bit is the fact that they can’t enforce their ‘I need it now’ worldview on the rest of the world. Their pound foolishness is their furious impatience with thwarted gratification, including the supporting players who sell and maintain their private islands, third, fourth and fifth homes, private jets and yachts. The ultra rich are able to afford the price of anything and demand that their assistants are proxies for their unreasonable demands for urgency. They’ll (foolishly) pay the rush charge ten times over rather than wait.
A Question of Non-Negotiable Constraint: Time
The problems of the impossibly wealthy are the same, but different. The ultra wealthy march to another timeclock. they don’t care that incredibly high costs are baked into this “I need it now” mandate. We found that while the ordinary business or leisure traveler may rail against the endless queues they must endure at the airport, the UHNW face the daunting and ever so humble bragging rights gauntlet of luggage loading and delays in take-off on their NetJet flights from Teterboro. The fabric of our interviews is threaded with their sense of urgency, not unlike the short fuse on a ticking time-bomb. The childhood refrain of “I want it now” echoes throughout their calendar. In some ways an enforced delayed gratification works to make an acquisition far more valuable through anticipation. In this rarefied circle, having to wait for the upholstery fabric to be woven creates an excitement which otherwise eludes the reality that they must wait for it. And all their peers are waiting too, they’re in the waiting room of the great weaver together. But this erudite expectancy brings a frisson of risk; pity the poor designer who bears the message, “It’s been delayed.” So, when confusion at the ports delays shipments from a remote village in an area hidden somewhere beyond the vineyards of Tuscany, it’s fatal for the messenger. Or builders quake in their boots when the new yacht isn’t ready by the July 1 deadline for a member of some new minted money family to sail the Mediterranean for the summer.
Marketing Implications
So, how do we relate this degree of ‘foolishness’ to the marketspace? Consider the plight of high-end boutique hotels that have no problem selling out the $30,000-a-night penthouse suites but have trouble with the less rarified double rooms downstairs. Or those flights from the Middle East in which first class cabins with private beds and bars and chef-curated menus are routinely booked to capacity, while the back of the bus flies empty-bellied.
For retailers it’s occasionally an issue of perspective. For a mass premium brand like Apple, the Hermès Double Tours watchband sales ‘never amounted to a blip.’ However, if you ask Hermès, their take is quite different: 10 percent of retail sales were chalked up to that wristband and its kin. Marketing success depends on your perspective and base. A watchband for Apple gets lost in the sales volume. For exclusive, status-based Hermès, the bespoke watchband is coveted.
Marketing to the UHNW is more a question of marketing with than marketing to. And better, how to market through them. Their unmet need: To be firmly ensconced with people like them. At their clubs. Behind the gates at their various communities. At their galas and polo matches. The retail world talks endlessly about the ‘experience economy.’ Figuring out what constitutes an experience worthy of the wealthy personal narrative is the challenge. It needs to be site specific, customized, and keenly aware of which side of their coin aligns with your brand.
