By Michael Phillips
Luxury brands face a growing challenge in developing marketing strategies that effectively influence the purchasing decisions and loyalty of the world’s wealthiest individuals.
Wealth-X recently released a report detailing the interests, passions, and hobbies of the world’s ultra-high net worth (UHNW) population. The research was an effort to provide insight into preferences that may or may not be related to aspects already known about these individuals. Together, these characteristics and pursuits help explain what “makes someone tick” and can be used by luxury organisations to create marketing experiences that attract new customers, retain existing ones, and build brand loyalty.
The key findings from the UHNW Interests, Passions and Hobbies Study are outlined below as a guide for organisations seeking to effectively engage wealthy customers, donors, and clients.
A clear trend to emerge in recent years is the growth of billionaires’ investment in sport. Historically, the diversification of UHNW asset portfolios into this category was largely confined to football, primarily in Europe, and to US ownership of baseball, basketball, and football teams, alongside the more niche activities of horse racing and yachting. Involvement was often a statement of ego and prestige, as well as a consideration of financial returns.
However, the rapid expansion in the value of sports media rights, the growth of billionaire wealth in Asia and other emerging markets, and increasing global reach through digitisation are all driving a transformation in billionaires’ investment in sport. There is now a more favourable environment in which to combine sporting passion with business perspective, while also offering the potential for additional commercial opportunities by being “in the same room” as an expanding group of the world’s ultra-wealthy population.
In the “old-money” markets of Europe and the US, the boom in television rights has attracted a steady stream of new billionaire owners of UK Premier League football teams, as well as clubs across Europe, and a rising share of basketball, soccer, and Major League Baseball teams in the US. Sporting investments by young Asian tycoons have risen particularly sharply, driven by huge domestic investments in Chinese Super League football and Indian Premier League cricket. The latter has revolutionised the sport, spurring the creation of similar tournaments in almost every major cricketing nation.
Music to Note
Music has a universal appeal, and yet it is an interesting pursuit to examine in the context of the billionaire community. The ultra-wealthy population as a whole favours classical music (20.9 percent), reflecting a demographic with a high average age, rather than particular refinement or connoisseurship. The most popular instruments are guitar (7.2 percent) and piano (6.1 percent), with only violin and drums registering an incidence of greater than 1 percent.
Another area that has growing billionaire involvement is art, both in terms of affinity and collecting. The rise of global billionaire wealth over the past decade has created a greater concentration of UHNW individuals among the world’s leading art collectors. The US and Europe continue to account for the largest share of billionaire representation, but collectors in Asia and the Middle East are becoming increasingly active, supporting the growth of private museums, art fairs and global auction activity.
Two record-breaking art sales occurred in 2017. The first was a Japanese collector who paid $11 million for a Jean-Michel Basquiat painting, a new auction record for an American artist, and the second was a Middle East buyer who paid $450 million for Leonardo da Vinci’s Salvator Mundi, surpassing the previous world record price for a painting.
Luxury art collections have traditionally offered strong value as an investment asset; industry estimates of global auction sales suggest that art was one of the best-performing asset classes in 2017, with demand underpinned by the robust development of prime real estate markets. The expansion of the Asian billionaire class and the growth of tech-driven wealth has produced a cohort of younger billionaires, which has contributed to increased demand for contemporary art in general.
Additional findings from the UHNW Interests, Passions and Hobbies Study include:
- North American UHNW have the highest preference for philanthropy, the outdoors, public speaking, writing and law.
- Latin American UHNW show a preference for aviation, family, engineering, the environment and economics.
- European UHNW scored the highest for travel, art, music, vehicles, food, science, collectibles and languages.
- Middle Eastern UHNW had the highest engagement with business, finance, education, technology, real estate, health and wellness.
- The interests with the greatest universality transcend cultural differences: business, sports, finance, health and wellness, religion and writing.
Luxury organisations understand that marketing to wealthy individuals requires a high level of intelligence to develop a strategy that is personalised. One of the most important elements of research when engaging with the wealthy is to understand their interests, passions, and hobbies. In previous Wealth-X World Ultra Wealth Reports we have leveraged intelligence from our global database of dossiers on wealthy individuals to reveal the most popular interests among UHNW individuals at a high level.
In creating the UHNW Interests, Passions and Hobbies Study, we took a more nuanced approach and compared these findings by region, age group and gender, as well as examining the breakdown of subcategories in art, music, sports, animals and collectibles.
The global leader in wealth information and insight, Wealth-X partners with leading prestige brands to fuel strategic decision-making in sales, marketing and compliance. Wealth-X boasts the world’s most extensive collection of hand-curated dossiers on the ultra-wealthy and produces unparallelled high net worth market research. Founded in 2010, with more than 200 staff across North America, Europe and Asia, Wealth-X works with over 500 clients, globally.
The Wealth-X Custom Research team is experienced in creating bespoke market reports that inform development strategy. If your company is interested in utilising our research services, please consult our Custom Research page and contact us at email@example.com.