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Luxury Hospitality Industry: Lessons from Marriott’s Bonvoy Program

luxury hospitality industry

Rewards programs or loyalty programs are a key part of marketing in the luxury hospitality industry. These programs are a way to drive engagement and increase customer lifetime value.

WealthEngine’s Senior Client Engagement Manager, Daniella Perlman is a sector expert. She shares her guidelines on how to drive loyalty among luxury hospitality guests.

Why are rewards program important for luxury hospitality brands?

Luxury guests are especially interested in connecting with your brand.  They need to have a high degree of connection as they are living on your properties for a period of time. This means that your brand has to match their lifestyle and expectations.

To drive engagement in this segment, you need to offer rewards, special benefits, and exclusive experiences. Use personalization to find the right offer or experience for each customer. Personalized luxury programs are growing in popularity in the luxury hospitality industry. They are also becoming more refined in the way that they engage with guests.

For instance, Marriott has updated its rewards program to something called Marriott Bonvoy.

What is the Bonvoy Program? How is it different from other luxury hospitality industry programs?

Since its launch this past January, Bonvoy has taken over the luxury hospitality industry. It is a combination of Marriott Rewards, Starwood Preferred Guests (SPG) and Ritz-Carlton Rewards. Starwood was part of the merger with Marriott in 2016. The two luxury hospitality programs are now integrated.

Of course, this is big news for the industry and for luxury guests.  Marriott Bonvoy has captured a large market share and is now the world’s largest hotel chain.

What can luxury hospitality consumers expect from this program?

Marriott was smart to leverage the strength of the SPG program. The SPG program, in particular, has a cult following in the luxury hospitality industry. It was popular among luxury as well as business travelers. Both segments enjoyed redeeming points for amazing experiences. For example, they could get free nights at hotels and resorts all over the world.

Further, the program features partnerships with luxury providers such as American Express. Luxury hospitality consumers can have their pick of luxury properties. For instance, they can stay at the Ritz-Carlton, JW Marriott, St. Regis, or the Luxury Collection. Guests can access all these from within the Bonvoy network.

What does this mean for the luxury hospitality industry? What can other large, luxury brands do?

Other luxury hospitality brands can take a different approach than the Bonvoy program. Marriott is capturing a large part of the market. Yet, the luxury hospitality industry is all about personalization and exclusive experiences. Luxury travelers are looking for rewards and experiences tailored to their needs.

Thus, while Marriott is casting a wide net in the luxury hospitality industry, other brands can do the opposite. This means you can find an exclusive niche that you can occupy in the industry. It also means that you can fulfill the exclusive needs of specific types of guests.

No two luxury customers are alike, you cannot overlook this fact. Luxury hospitality brands need refined customer segmentation to drive hyper-personalization.

What factors should luxury hospitality brands consider while segmenting their customers?

It all begins with data analysis. Analyzing data helps you understand what makes your customers unique. WealthEngine’s WE Analyze can provide descriptive information about your contacts.

For example, you can see how many members of your rewards program own private jets or cars worth over $200,000. These are people who clearly enjoy luxury experiences. If you find that you have a large segment of members who are car enthusiasts, you can customize your offering to them. For instance, let’s say your property is near a NASCAR track. You can target promotions for this property to these members. Customer segmentation and analysis help you direct the right message towards the right consumer.

In this instance, you could also offer a private event for these members at the race track. This way you are offering them an experience that is hard for your competitors to replicate.

What other use cases help luxury hospitality brands set up meaningful programs?

Everything comes down to engagement. This is even more effective if it happens in real-time. Another use case is through WealthEngine’s API. 

The API provides real-time data during online booking or even during check-in. For example, let’s say a non-member is checking in. Knowing their wealth profile, lifestyle preferences and interests immediately helps you make a personalized pitch to them.

When a luxury customer is checking in, you can offer them an upgrade to an executive suite right away. This sets the stage for actionable upsell opportunities.

A lot of times, when guests book a room online, you may offer bundling options. These could be as simple as breakfast or something like tickets to a nearby event. These bundles are usually offered without knowing the buyer well. Imagine how personalized and effective you can make them with data appended through the API integration.

The look-alike capabilities built into WealthEngine are useful to the luxury hospitality industry. For example, if you know which members have purchased high-end stays and experiences before, you can use this data to find new members for your loyalty program.

WealthEngine can build a persona based on common traits shared by these customers. These traits can include age, income, number of properties owned, etc. This persona can then guide you to find more people who look like your customers or members.

In fact, one of WealthEngine’s clients, a global hospitality brand has used this approach to find a lot of net-new customers.

How do you find your niche in the luxury hospitality industry?

Think about what is unique about your brand and your story. This then extends to what is unique about your offering and your location. You would use these factors to define a niche for yourself in the luxury hospitality industry. This is were driving an emotional connection with your guests comes in. Your guests will be loyal to you when your guests feel like you understand them, their needs, and interests.

For example, if your guests are wine connoisseurs, send over your sommelier when they dine at your property. Invite them to an exclusive wine-tasting, recommend a trip to a nearby winery. These are ways to drive that emotional connection.

WealthEngine’s data is derived from a vast array of sources. We can tell you which guests like wine, golf or NASCAR. These finer data-points can help with hyper-personalization.

How else can luxury hospitality programs set themselves apart?

Analyze trends in the luxury hospitality industry, analyze your member base. Match trends and interests to your existing offerings. You can also think about what causes they are interested in. If your organization supports these causes, make sure you let members know.  This comes back to the emotional impact. It creates emotional connections and seals in brand loyalty.

For instance, if your organization gives to animal rights causes, make sure that your members who share a passion for this cause know about your initiatives. Similarly, if they are pet owners they could also feel a connection to your brand through your animal rights initiatives.

WealthEngine’s data scientists can help identify these interests and affinities among members. Creating wealth models around these data points can also help identify more customers.

Another such opportunity is leveraging galas that nonprofits might host at your properties. Working with the hosts, you can screen attendees to provide valuable insights.

You can help identify top prospects that the nonprofit should engage with at their event. Thus, the nonprofit can use their time effectively. For instance, WealthEngine provides actionable insights when you use services such as EventBrite to manage guestlists.

WealthEngine integrates with EventBrite through Zapier. This means that the hotel could screen attendees as they register to attend the event. These insights can benefit both you and the host organization. Both can leverage these insights to build relationships with influential guests. Further, providing insights as a value-add also strengthens your connection to the nonprofit.

These are all ways in which data enables personalization in the luxury hospitality industry. Personalization drives the emotional connection with guests. Further, the emotional connection drives loyalty. Loyalty reduces acquisition costs and increases lifetime value.

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Find your luxury hospitality niche. Take a minute to fill the form on the right and a WealthEngine rep will contact you very soon.

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Why You Need a Concierge Marketing Strategy

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What is Concierge Marketing?

As a marketer, you strive to deliver a personal experience to your clients each and every time, right?  Much like a good concierge, you try to get to know your clients– their mindset, interests, and passions. But, what about the moments before they even walk into your store?  Is your marketing using the same personal treatment to get a client to the door?

Think of this process as Concierge Marketing.  A concierge marketing strategy allows you to embrace a way of understanding, engaging, and personalizing your clients’ experience so you can develop a meaningful relationship with them from the very first interaction. Let’s explore some of the ways you can engage consumers by implementing key concierge marketing strategies.

Concierge Marketing Strategy: Meeting Customer Expectations

Customers’ expectations of brands have risen steeply. To be specific, they want personalized, transparent, and respectful relationships. While marketers know this is a critical time to pivot and engage with consumers in a new way, they are facing the challenges posed by the abundance of data and how to capture and glean knowledge from it. As noted in WealthEngine’s Luxury Marketers Guide to Engaging and Winning HNW Customers, here are some basic best practices:

  1. Know your customer
    It’s frightening that 40% of brands don’t target any specific customer or prospect segments. In addition, 28% of marketers don’t know which high-value customers they should focus their efforts on. That’s where data comes in. Use it and garner insights about your customer.
  2. Know your goals
    Once you understand the attributes and relative value of various segments within your customer base, it will be much easier to make decisions on where to allocate resources, and which strategies and tactics to expand. Using analytics can identify the point of diminishing returns for targeted campaigns, giving you more return on investment while safeguarding your budget.
  3. Know your needs
    Once you’ve established your goals and the strategies you will be using to reach them, you can identify the data that you have to support your initiatives. At that point, you can discern the data you need to append in order to truly understand the mind of the consumer and to create compelling, personalized content & messaging.
  4. Know your prospects
    It’s crucial to approach individuals with the wealth,  affinity, and lifestyle to engage with your brand. As a result, these high potential prospects will be your next customers, and more importantly, they can transform into your brand ambassadors.
  5. Know your data 
    Data is not static; it is changing by the minute. Each time a prospect takes an action on your website, engages with a salesperson, or visits your business, the data associated with that consumer flutters and expands. So, you must track and use that data to maintain your relationship and continue to drive authentic experiences.

Concierge Marketing Strategy: Data and Consumer Engagement

Bottomline: Getting an advantage from data in marketing is art and science.

It’s not easy…and more importantly, it’s not over once you start. It’s a continuous effort and must be a commitment to your customers. Once you’ve adopted a concierge marketing strategy where you’re able to tailor your messaging to the unique needs of your donors and prospects, you’re one step closer to creating a loyal consumer base. So, now’s your chance to use unique data to help build authentic experiences that you, as a marketer, need, and customers demand.

Want a demo of WealthEngine to see how WE can help you with audience development, marketing personalization and wealth insights? Share your contact information and we’ll be in touch soon.

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Omnichannel Marketing Strategies in Luxury Marketing

omnichannel luxury marketing

Ever wonder how to retain your luxury customer? Today’s customer can jump from a retail environment to a digital one within a given day. How do you ensure that you engage them on every channel?

Omnichannel marketing strategies in luxury marketing offer a distinct way of interacting with your customers. It’s more personalized and dynamic.

Omnichannel marketing can be defined as a multichannel sales approach that provides your customers with a fully integrated shopping experience. They may be shopping online from a desktop or mobile device, by phone, or in a brick-and-mortar store. Omnichannel marketing strategies for luxury brands utilize all of those channels, but in a way, that best fits your customers’ needs.

The goal is to give your customers a seamless experience from channel to channel.

How Do Your Customers Prefer to Interact with You?

How do your customers like to shop for your product or service? What is the process they usually follow before they decide to buy from you? Do they use a desktop computer? A smartphone? A tablet? Or do they go to an actual, physical location? And how many times during the day do they switch between those devices?

Here are the more typical channels used in omnichannel strategies in luxury marketing:

  1. Smartphone: Assume your customers will use their smartphones as part of their buying experience.
  2. Email: Just about everybody uses email these days, even grandma. It’s an important element in omnichannel luxury marketing.
  3. Social media: Social media can be used to connect with customers at home or work and on multiple devices.
  4. In-person contact: Your customers can get immediate answers to their questions in person, along with your input on product and service options.
  5. Website: If you’re in business, you need a website. Period. It’s a primary channel of customer contact.
  6. Print: There are still people who like print media. More so, you can use a printed business card or catalog to encourage website or store visits.

Omnichannel luxury marketing reaches your customers in the way they prefer to interact with your business. They may use one channel or switch between them throughout the day. But you need to give them those choices.

Multichannel Marketing vs. Omnichannel Strategies

While omnichannel marketing uses multiple channels, multichannel marketing may not be omnichannel.

“Most businesses invest in multichannel marketing,” writes Aaron Agius in a HubSpot article. “They have a website, blog, Facebook, and also Twitter. While they use each of these platforms to engage and connect with customers, in most cases, the customer still lacks a seamless experience and consistent messaging across each of these channels. You can have amazing mobile marketing, engaging social media campaigns, and a well-designed website. But if they don’t work together, it’s not omnichannel luxury marketing.”

Omnichannel marketing uses the same channels, but in a way, that best fits your customer’s personal needs. Is your customer planning on visiting your physical store? Shopping on your website? Calling and ordering by phone? Interacting through a mobile app? Omnichannel luxury marketing is done in a way that creates an integrated and cohesive customer experience, regardless of which channel a customer chooses.

In the past, a retailer might provide a desktop experience, a mobile experience, and also a tablet experience. Now they must create an omnichannel experience that customers can use whenever they want.

Start by Targeting Your Optimum Luxury Market Customer

The more channels you utilize for marketing, the more likely it is your customers will find you. So having multiple channels does improve your marketing efforts. However, multichannel marketing alone does not ensure people are actually going to do business with you. It only gives you access to a bigger audience.

Omnichannel marketing can also help you get the most out of every channel. Omnichannel luxury marketing is a move towards more personalized communication with your consumers. This includes determining the best channels of communication to reach them.

Regardless of strategy, good marketing programs begin with sound data. You start by targeting the people who fit your customer profile. Those are the buyers with a much higher potential or propensity to purchase your product or service.

“Through data science and our database, we identify the group of individuals that we want to go after.“ said Patrick Bischoff, president of the Commercial Markets Group at WealthEngine. “At WealthEngine, we believe that our clients are best served by building a ‘cocoon of information’ around an identified individual. We provide this information cocoon for them.”

Omnichannel Luxury Marketing Is Personalized Luxury Marketing

When you’re trying to reach wealthy customers, you need to know what resonates with them.

“Obviously, we’re exposed to many, many forms of media these days,” said Bischoff. “It’s not simply the one-page ad in the luxury magazine or the TV ad for a certain brand. An omnichannel strategy can start with a direct mail message.

“At the same time, you already know the individual’s email address. Somebody who receives a direct mail piece then receives emails at a particular cadence. You’re trying to stay at the forefront of an individual throughout the whole process.”

That’s why it’s important that each part of your consumer’s experience is consistent. An item placed in a shopping cart through a mobile device should still be there when your customer accesses the cart on their desktop computer.

Omnichannel Luxury Marketing ROI

Luxury marketers should also have a strategy for a cohesive experience across all appropriate platforms to reach their target customers. Such a strategy will give your customers the feeling of that all-important “personalized service.” Also, companies that successfully implement omnichannel luxury marketing have an advantage over their competitors.

These interesting statistics regarding omnichannel marketing results were cited in a GetCRM article:

  • 90% of customers expect consistent interaction across various channels.

  • 87% of customers think brands need to put more effort into providing a seamless buying experience.

  • Businesses utilizing omnichannel marketing strategies achieve 91% greater year-over-year customer retention rates than businesses that don’t.

  • Companies with extremely strong omnichannel customer engagement see a 9.5% year-over-year increase in annual revenue and a 7.5% year-over-year decrease in cost per contact.

Yet omnichannel luxury marketing encompasses more than simply providing seamless, multiple channels of customer contact. You have to offer your customer quality contact with your business. Your customer service must be up to par, whether by phone or through an online chat. Otherwise, a new, interactive website or colorful brochure won’t have much value.

All channels of a luxury marketing strategy must work together to provide today’s luxury consumer with their ideal buying experience.

WealthEngine data can help you determine how to best reach your target luxury consumer. Fill the form on the right and a rep will contact you very soon.

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Redefining “Luxury Brand” for Your Luxury Marketing Strategy

Why do consumers consider one brand to be a “luxury” brand and another brand not? Exclusivity? Performance? Quality? Innovation? Heritage? For the most part, those all have been defining characteristics of a luxury brand, and they still are. However, there’s been a shakeup underway. The traits that carry the most weight with consumers in today’s luxury market have changed.

“The definition of ‘luxury’ is undergoing a paradigm shift in the consumer market,” said marketing expert Pamela Danziger. Unity Marketing and Luxury Daily recently surveyed over 600 luxury retailers and marketers. They found that the definition of luxury is the “number one disrupter of the luxury business.”

What does this mean for a luxury marketing strategy? If you know how consumers think of luxury and what drives their purchases, it can help you determine the best strategy to attract wealthy clients. You can also reduce the cost of acquisition.

Quality Is Now the Top Characteristic That Defines a Luxury Brand

Ask any Apple buyer how well they like their Mac or iPhone. They’ll undoubtedly tell you they believe Apple products are far superior to any competitor. It doesn’t even matter if competitive products offer better features. Apple may got its start by launching a unique computer product to compete against Microsoft. But Apple’s following has grown far beyond disgruntled PC users. There may be a certain “status” to owning an Apple product. However, the company built its brand on a reputation of quality and performance.

Now consumers are defining luxury differently. Just a few years ago, quality took over as the leading characteristic of luxury. Data from a recent major report confirms that quality, not exclusivity, is now the key definer of luxury for consumers globally. According to Albatross Global Solutions and Numberly’s fourth annual “The Journey of a Luxury Consumer” report, 85% of luxury consumers say quality is the most important characteristic.

“What separates true luxury from the idea of luxury is quality,” says Javier Calvar, chief operating officer at market research firm Albatross Global Solutions.

Younger Consumers Are Playing a Bigger Role in the Luxury Market

A change in the demographics of today’s luxury consumer is behind the shift in what defines luxury. Traditionally, the luxury market has been made up of older consumers, many with inherited wealth. Baby boomers and those older still make up 60% of the total global luxury market. But the other 40% is made up of Generation X and millennials. So younger consumers are representing an increasingly significant portion of the luxury business.

Younger people, with newfound wealth, are not only moving into the luxury market, they’re redefining it.

“When money goes into the hands of people that didn’t have much of it before, the relationship those individuals have with luxury brands is very different from those who have been exposed to luxury brands for a long time,” said Calvar. “A really large percentage of our top-end product customers are between the age of 30 and 50. It’s no longer a retirement plan to buy yourself a yacht to enjoy in your golden years. ”

Millennials in particular are a luxury marketing segment growing in importance and wealth. They see exclusivity as less important. Instead, they prefer to “belong,” and have little interest in something that separates them from their peers.

Connecting with the New Luxury Market Consumer

How can you connect with this new luxury market customer? Identify the specifics of your target customer’s profile. Once you know about their likes, dislikes, and best methods of contact, you can build a more effective luxury marketing strategy.

So it’s more than demographic data, it’s about understanding your customer’s mindset, whether your luxury customer is 35 or 65. Appealing to a baby boomer is different than connecting with a millennial, though both may have interest in the same product. Knowing the buying motivations of each allows you to tailor your message to that niche segment.

“Quality always will be essential to luxury, said Lyle Maltz, a director with Kantar Vermeer, WPP’s global marketing consultancy. “But now emotional value and a strong, personalized relationship with consumers are of great importance in luxury marketing.”

Today’s luxury marketing is “highly personalized marketing. It has a very specific and defined message that resonates with an individual’s affinities, interest, and wealth capacity,” agrees WealthEngine’s Patrick Bischoff, president of the Commercial Markets Group at WealthEngine. You need to build that one-on-one relationship with your customer to make them feel they are being treated as an individual.

Following a Customer-Driven Luxury Marketing Strategy

The new luxury market consumer will define what makes a brand a luxury brand, not the other way around. Today it’s less about marketers and more about consumers. That can make it more challenging for luxury marketing strategy, as the definition of “luxury brand” continues to shift. Still, to truly prosper in the luxury arena, luxury marketers will need to follow the lead of their target luxury consumer.

“The change in how consumers define luxury and the new path to purchase is dramatically redefining the marketing strategy,” said an unnamed marketing industry insider in a Forbes article. “Luxury brands must be very agile and innovative in order to gain the favors of the new luxury consumer.”

Giorgio Armani is a brand known globally for its high-end designer men’s clothing. It began by targeting the ultra high-end professionals who desired a high quality product. Since then, Armani has gradually expanded its brand scope with products aimed at broader customer segments. Armani launched a line of jeans in the U.S. market for fashion seeking, price-sensitive youths in urban metro areas. It’s an example of a luxury brand creating sub-brands to capitalize on and cater to a different customer segment.

As stated in a WARC article, “The traditional luxury model has been challenged further with the rise of digital platforms, social mobility, the emergence of ‘affordable luxury,’ and the particular preferences of millennial shoppers.”

With more younger luxury buyers who grew up in a digital world, you must also change your luxury marketing strategy. Part of building a luxury brand involves communicating with customers in the way they prefer. Years ago, that may have been print ads, direct mail, or TV commercials. Today it’s more likely to include special videos, social media, apps, and other digital means that provide a “total customer experience.”

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6 Top Luxury Trends in 2018

The luxury goods sector has long been one that inspired envy, whether it’s the attached glamor or the high margins enjoyed by retailers.

However, reports have indicated that the sector has seen stagnation and a low, single-digit growth rate in 2016 & 17. Under these circumstances, it is important to identify, understand and embrace the trends that define the industry today.

We sat down with Neha Kapasi, our Luxury Sales Director, to discuss her perspective on Luxury Brand Marketing and how WealthEngine can help companies personalize their engagement with wealth and lifestyle data. Listen to the full podcast. 

Luxury companies that have foreseen or even set the trend in some instances have benefitted from having a competitive edge and are poised for success in 2018. With more brands entering the market at every level of luxury, let’s examine the trends that can help set these purveyors of refinement apart.

1. Becoming Street Smart

When it comes to staying relevant, the luxury industry has it particularly hard. What’s trendy today could become irrelevant tomorrow. Millennials and other young consumers of luxury products and services have shown that they have a preference not only for the indulgent but also for the cool.

The ‘street-edge’ factor is becoming something that is prized among consumers. Fashion giants such as Balenciaga and Balmain have hired creative directors who can create the new cool. Meanwhile, other houses are benefitting from unexpected collaborations such as Louis Vuitton x Supreme and Gucci x Dapper Dan.

2. Communicating with personalized precision

BCG has predicted a massive revenue shift towards the top 15% of marketers who embrace personalization. Luxury customers are especially likely to respond to messages that are custom tailored to them. We have talked before about how no two millionaires are the same.

It is no longer enough to look at just wealth indicators for marketing effectiveness. Luxury companies need to have a more holistic view of customers including demographics, lifestyle attributes, and affinities so that their Account Based Marketing is more targeted and therefore more efficient. Luxury consumers, especially those from digitally savvy generations crave an authentic experience. This means that luxury companies need to embrace data and AI to deliver the most personalized, highly customer-centric experience- whether it’s travel, high-fashion, auto, or real estate.

3. Embracing technology

Speaking of personalization and digitally savvy consumers, luxury companies that are early adopters of technology will emerge as winners. Technology needs to permeate not only communications but also the very delivery of customer experience.

Data and Artificial Intelligence can help identify patterns, create predictive models and customize messaging for Account-Based Marketing. An omnichannel approach enables luxury purveyors reach consumers where they gather. For instance, Instagram is not just for influencers and aspirational followers. Of the 800 million Instagram users, 80% of them follow brands. 75% of users are reported to take action after seeing a business post.

Augmented and Virtual Reality can provide consumers a richer experience when it comes to product trial, creating shareable media and enjoying a more digitized in-store visit. Amazon and Zippin have set the trend of creating check-out free shopping, eliminating a bottleneck and further integrating online and offline experiences.

4. Weaving purpose into their business

Although this may be more a movement than a trend, purpose, and meaning are extremely important to millennials and younger generations who will soon represent 45% of the luxury market. It is common for luxury conglomerates such as Kering Group or LVMH to have corporate social responsibility units.

Today, however, the emotional and experiential preferences of millennials and gen-Z goes beyond perfunctory social impact. It is important for luxury companies to build purpose into the very design of their business. This could be through using sustainable materials, reducing their carbon footprints, supporting or highlighting the work of marginalized communities, ethical sourcing, and treatment of manufacturing partners. Ultimately both clients and employees want to associate with responsible businesses.

5. Making customers and employees feel included

In keeping with the idea of responsible business, inclusiveness is another big theme in the luxury market. By its nature, luxury is not inclusive. However, today seeming out of reach makes brands feel unrelatable.

Fine jewelry companies such as Tiffany & Co and Bvlgari are each doing their part to become more inclusive. While Tiffany has created a modernized and minimalistic space within a new retail store, Bvlgari has created more entry-level pieces to be further within reach. Meanwhile, Gucci has made strides in the area of diversity. Gucci’s rising revenues are a classic example of success bolstered by embracing the current zeitgeist of the luxury industry.

6. Enabling access as an alternative to ownership

Inclusivity is further accomplished by enabling not only ownership but also access to luxury experiences. Experience is the operative term in the luxury industry today, as reports have shown that HNWIs would rather spend big dollars on memories than goods.

This being the case, the sharing economy is also affecting the luxury sector. Luxury holiday homes and private jets have started to benefit from a market that is happy with access for a desired period over long-term ownership. This is bringing about a democratization of luxury consumption, which is predicted to be an ongoing trend. 

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Luxury Product Marketing: Understanding the Luxury Consumer

Wealth trends are constantly changing. While using a standard luxury product marketing strategy for every consumer may generate sales, by fine-tuning your approach you can get more business from the luxury consumer who becomes a loyal customer.

Listen to the full podcast.

What is Luxury Product Marketing?

Luxury product marketing is the business of promoting and selling high-end products. Not only do luxury brands draw consumers in with their high-end products, but they also actively manage the perception of these products.

Luxury Goods Market Study

Revenue from the US luxury goods market is estimated to be between $85 and $100 billion annually, according to Euromonitor.

The luxury market is more relevant than ever. Over the past year, the luxury market has grown by 5% worldwide. This growth stems from the sales of three major items: luxury cars, luxury experiences, and personal luxury goods. These three items alone, account for more than 80% of the entire luxury market. Luxury car sales dominated the market in 2017, increasing by 6%. Sales in luxury experiences increased by 20% in two areas: high-end food and wine (up by 4% since 2017) and luxury cruises (up by 16%). As for personal luxury items, which are the core of the luxury consumer market, sales have increased by 5%.

The best luxury product marketing efforts focus on more than just those who can easily afford luxury goods. They target every person who is willing and interested in saving up for high-end products.

Understanding the Luxury Consumer

Reaching the same luxury consumer today can be different a few months from now. Wealth changes. But there’s more to it. When you learn about the interests and buying habits of individuals, you’re able to find more ways to influence those consumers and new ones. Knowing this information can help you find ways to generate more sales.

You might think that only affluent consumers want to purchase luxury goods. But, the truth is that there are other groups who are equally likely to purchase these products, and you can’t neglect them.

Think about the person who has been saving up for that new BMW or that new Louis Vuitton bag. All of those consumers are so drawn to high-end items, that they’re willing to save and splurge on your products. This gives you an opportunity to nurture them as loyal lifelong luxury consumers. As a result, luxury product marketing targets consumers who have both the capacity and intent to buy your products.

Download WealthEngine’s free Millionaire’s Report to find hidden gems about the buying habits of your wealthy customers.

The luxury market is no longer solely dependent on managing brand reputation and recognition. It’s also dependent, if not even more dependent, on understanding luxury consumer behaviors, clarifying your goals and intentions, and using this information to motivate buyers. These qualities will equip you to build a loyal customer base.

Luxury Product Marketing Questions

As you clarify your messaging, ask yourself:

  • What are people buying – what is the brand promise?

  • What are our luxury consumers interested in – causes, issues, other non-product related drivers?

  • How can we enhance customer profiles with wealth and interest data to reach more people who fit our buyer persona?

  • How did, and how are, we engaging our customers based on what we know about their purchasing influencers?

When you create luxury product marketing campaigns that are tied to the things that influence your buyers, you naturally forge deeper connections.

Adapting to Changes in Luxury Consumer Behavior

Creating a strong foundation is only the first step. There’s much more.

  • How do you keep that luxury machine churning?

  • What can you do to captivate your customers?

  • What methods get people to recommend your luxury brand?

  • How can you maintain their interest?   

Luxury product marketing requires you to be nimble. It’s important to recognize that there isn’t one type of customer coming through your door. More so, they have different needs to satisfy and it is ever-changing. The wealth-profile and buying propensity of a customer today can be different next year. As a result, it is important to stay on top of the changes in the wealth and interest of your luxury consumer.

By tailoring your messaging, you’re able to communicate your mission in ways that are accessible and appealing to more individuals. You’re maintaining the mission of your brand as you continue adapting to your customers’ needs.

Developing targeted messaging creates a good foundation for your brand. However, by leveraging wealth data, you can see how likely your new customers are to make a purchase, and when. This means that you don’t need to keep waiting for consumers to return! You have the power to evaluate demographic data to determine what they’ll need in the future.

When your customer is about to retire, they may be more inclined to buy luxury products associated with travel. They have a greater need for it. This information allows you to create messaging that’s more personalized, for individuals and groups that have similar experiences.

Luxury product marketing, in this case, allows consumers to feel that they’re part of a novel and elite experience. Customers are that much more excited knowing that they’ll have an individualized experience.

Learn More

Learn more about how personalization can enhance luxury product marketing to generate loyal customers with higher LTVs. Take a minute to fill the form on the right and a WealthEngine rep will contact you very soon.

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6 Ways to Maximize Your Holiday Marketing

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As summer comes to a close, the holiday season is fast approaching! What is your brand doing to prepare for the holiday rush? Consumers will be ready to spend. What data are you using to segment your customer base and supercharge your marketing efforts? Do you know the customers or prospects that can afford the products you sell?

Below are some helpful tips from WealthEngine for marketers to execute a flawless holiday season marketing campaign:   

  • Start you holiday marketing early to raise awareness ahead of the holiday season. This way when customers are ready to purchase, your brand is top of mind!
  • Segment your audiences using wealth and lifestyle intelligence to ensure the appropriate message goes to the right consumer.
  • Create multi-channel marketing campaigns (email, snail mail, banner ads, etc.) that have continuous impressions to achieve maximum results.
  • It’s never too late to put together an effective marketing campaign. Using relevant data to inform your decision making will supercharge your efforts. Don’t be afraid to get other departments in your company psyched about the holiday push and let them know how they can help you best.
  • While considering new market trends, always review what worked well last holiday season and plan to replicate your previous successes. How can you optimize what already works using new data?
  • Finally, don’t be afraid to be bold and take chances. The holiday season can be a frantic rush of consumer decisions and the brands that stand out will win the consumer’s attention.

For more information and help preparing for your Holiday season, contact WealthEngine today. 

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Conversations with Leaders in Luxury

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WealthEngine’s President and CEO, Mark Logan, recently participated in Conversations with Leaders in Luxury Led by Chris Olshan, CEO of The Luxury Marketing Council. Mark discussed everything from how he got his start in business, to WealthEngine’s presence in the luxury space, and even what he enjoys doing outside of work (did you know he’s an avid hockey player and fan?)

Take a look for yourself to learn more about:

  • SaaS products
  • WealthEngine’s presence in the luxury space and how we help organizations
  • Big data
  • What differentiates WealthEngine from others
  • Our work with nonprofits
  • Trends in luxury
  • And more

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Predictive Lead Scoring and Analytics – It’s Easier Than You Think.

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The statement ‘predictive lead scoring and analytics made easy’ seems counterintuitive. How can lead scoring and analytics be easy? If it was easy wouldn’t everyone be doing it?

According to a marketing effectiveness study by The Lenskold and Pedowitz Groups, 68% of successful marketers cite lead scoring as most responsible for improving revenue contribution. Additionally, the Pareto Principle says that about 80% of your sales comes from the top 20% of your customers. These statistics should give you pause.

Think about it. What if you could find new prospects that look like your best customers and discover new opportunities among people you already know? Simply put, wouldn’t you want to find prospects that have the same characteristics as those in the top 20% of your customers? Having these actionable insights can dramatically impact your sales and marketing strategies, resulting in increased revenue. This is empowering and valuable information.

Let’s take it a step further with an example:

A luxury retail organization is developing a strategy for their holiday marketing campaign. Specifically, they are planning to host an instore event and want to ensure they are inviting the right people so that they get the most out of the dollars spent. They also want the event to be enticing so both customers and prospects attend.

The organization analyzed their top customers residing within a 30 mile radius of the store location to develop a customer profile. Surprise! These customers have an affinity for equestrian and tend to drive a Lexus. Just those two data points alone influence their marketing plan. What about partnering on the event with Lexus or an equestrian-focused organization? Additionally, the retailer can now identify prospects who fit this customer profile and have the same interests, increasing the likelihood that they will be interested in attending the event.

Going forward, the organization can now score new prospects and customers to determine how to market to them going forward.

Bonus – this information was identified in minutes and doesn’t require a data scientist. How’s that for actionable?

Insights at your fingertips. Increased efficiency and productivity. Find out more now in our on demand webinar Predictive Lead Scoring & Analytics Made Easy.

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What to Do Now to Maximize Holiday Spending This Year

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The current retail landscape presents many challenges that can be difficult to manage including decreased customer growth, little transaction growth, growing competition, shifts in spending, and unfavorable demographics. With a rapidly approaching holiday season and only 114 days until Black Friday it can be daunting trying to develop a successful strategy to overcome these challenges.

It’s no surprise that using data and analytics can dramatically impact your revenue, but analytics can only go so far if your data is vague or incomplete. Having complete, rich customer profiles will provide a stronger foundation for your analytics, and thus a stronger foundation for your marketing and sales strategy.

How can you enrich your customer data? Conduct a wealth screening to gain transformational insight into customers and prospects. A screening appends data to your customer database so you can better segment your database and determine who to prioritize in your marketing and sales efforts. This insight is helpful to not only identify your best customers, but to uncover those individuals who may show potential for additional business. You may be missing out on potential opportunities because you don’t know who has the capacity to spend more.

A wealth screening supplies you with wealth, income, lifestyle, and affinity information on individuals. This includes net worth, income, assets, real estate, stock holding, charitable contributions and other financial related data as well as business and personal contact information. Having this information allows you to prioritize who you focus on to maximize revenue.

A screening also lets you determine what marketing messages should be sent to each customer and prospect segment. In regards to gearing up your campaigns for the holiday shopping season, certain segments of your consumer database will have the ability to spend more than others. These individuals should receive offerings for higher cost items, while those who don’t have the capacity to spend as much should be shown lower cost items or a promo code to use to be able to purchase a more expensive item.  

The insights you can gain from a wealth screening are undeniable. By better understanding your customers and prospects the analytics and data you use to inform your decision-making will be more valuable and more impactful.

Contact us to learn more about how you can use these insights to not only identify your wealthiest customers, but to uncover those with the capacity to spend more.