THE FUTURE OF LUXURY HOTELS

  
The luxury hotel space is competitive but players are stepping up to the plate to keep up with rapidly evolving consumer demands. Here we investigate some on the cutting edge and what’s ahead.

Last month, in conversation with Robert Cheng, Group VP Marketing of the prestigious Peninsula Hotels Group, despite the plethora of exciting initiatives in the pipeline for the company, we found ourselves continuously drawn back to a particularly prevalent discussion on technology, innovation and their place in the luxury hotel space.

Keeping the balance between innovation, customisation and still maintaining that personal touch – which so often sets high-end hotels apart from the rest – is always top of mind, according to Cheng, and the risk of taking technology too far is always present.

Nevertheless, the increasing use of technology across the board in the luxury hotel space is a trend which is impossible to ignore – and the appetite for futuristic additions to the luxury hotel experience is palpable, particularly from the lucrative millennial set.

As Jérôme Destors, Director of Hotel IT at technology firm Amadeus, stated in its report ‘Hotels 2020 – Beyond Segmentation’: “Unique, connected, informed are just three watchwords that define the hotel guest, both today and in the future.”

Hence, understanding a customer is a strategic imperative for hotels in today’s world. We are operating in an era of unprecedented change. Brands that don’t recognise and respond to this run the risk of falling behind the competition permanently.”

So the question today is two-fold – how are luxury hotel providers currently innovating and what can be learnt from their pioneering advances and; what does the future hold for the hospitality space?

“Brands that don’t recognise and respond run the risk of falling behind the competition permanently.”

Two Heads Are Better Than One

First and foremost, when we hear ‘future’, often we think digital, smartphones, space travel. But innovation can also be more than just technology on its own.
Cutting-edge concepts that challenge the norm and offer new, exciting and exclusive options for the luxury consumer are often borne from forging inventive partnerships with like-minded entities and breaking new ground.
The Peninsula Hotels Group, for its part, has “never been afraid of technology” says Cheng, and has employed a dedicated research & development team for 30 over years to constantly scan innovations occurring across the globe and trial and adapt viable technology and concepts to suit the group’s properties.
But a perfect example of the aforementioned balance between technology and a personal touch materialised when the group established an innovative and exclusive partnership with online luxury fashion retailer and publisher NET-A-PORTER.com earlier this year.

  
 
The tie-up saw the two collaborate to create a series of stylish mini guides to the world’s most dynamic gateway cities.

The exclusive style savvy bite-sized guides were published on the respective hotel’s section of The Peninsula website (peninsula.com), and featured in the travel section of NET-A-PORTER.com’s fashionable The Edit magazine (net-a-porter.com/peninsula) during the week of launch.

According to Cheng, the duo will reunite again shortly to publish the next five in the series during New York Fashion Week in the Fall. But, as he hinted last month: “There’s more to come there, so stay tuned!”

“These meetings of innovative minds have since resulted in a range of out-of-the-box tie-ups.”

The Marriott Group is also pushing ahead, with research emanating from its 10,000-square-foot Innovation Lab and an Innovation Team, which is continuously brainstorming about what the hotel of the future will entail.

These meetings of innovative minds have since resulted in a range of out-of-the-box tie-ups such as a recent expansion of its partnership with TripAdvisor to add Marriott’s global hotel portfolio to the TripAdvisor Instant Booking platform from this summer, capitalising on the increasing shift in consumer behavior to trust recommendations from fellow guests over straight advertising.

Marriott and Netflix also officially announced a deal last month, which will allow guests to log in or subscribe to the streaming service via Internet-connected guest room TVs across several Marriott properties.

“Our collaboration with Netflix responds to changing consumer preferences in the way our guests access and watch content, while recognizing the leading role Netflix is playing in driving this transformation,” Matthew Carroll, Marriott’s VP of brand management, said in a statement.

Back To The Future

Starwood Hotels & Resorts Worldwide has, similarly, joined the ranks with the launch of its own high-tech design lab – Starlab – at its headquarters in Stamford, CT earlier this year.

The company has gone on to become the first to offer keyless hotel room entry, allowing guests to check in via their iPhones (or Apple Watch), and the group began trialing a robotic bellhop , dubbed Botlr, across its Aloft hotels in Cupertino and Silicon Valley in August last year.

Botlr, a three-foot high robot in the vein of R2-D2, allows guests to send request items – ranging from toothbrushes, smartphone chargers, magazines, newspapers and even snacks – from their smartphones, which can then be delivered by Botlr within two to three minutes.

When the robot reaches the guest’s door, the system calls the room, alerting the guest to the delivery.

  
Starwood’s robot butler, Botlr

Starwood is also in the midst of a roll-out for its smart-mirror concept, which offers guests immediate access to the weather, news and sports scores with a touch of the mirror’s surface.

A Bluetooth connection can also be accessed to link the guest’s phone so they can see their Twitter feed and other alerts directly on the mirror, which is powered by Panasonic technology.

No doubt the Starlab innovation team has also had plenty to do with Starwood’s recent interest in the Oculus Rift virtual-reality headset – bought last year by Facebook for $2bn – which Starwood reportedly aims to roll out to its Element gyms progressively in the near future.

“Gesture interfaces and 3D mobile phone displays could be common by 2020.”

The Amadeus report confirms that while technologies such as augmented reality and mind control headsets are already with us and are set to spread, “developments such as gesture interfaces and 3D mobile phone displays could also be common by 2020”.

Gesture interfaces for one, have the potential to drastically change how we view and interact with information and although the technology does exist – gestural interfaces have been developed by firms including Microsoft’s Kinect and Oblong Industries – this is still largely undiscovered territory for the hospitality industry.

Facial recognition though, is in the early stages of roll-out across the hospitality industry, with Universal Studios Japan one of the first hotels to make use of the technology in partnership with NEC via its NeoFace® Watch solution.
  
NEC NeoFace® Watch

NeoFace Watch uses cameras installed in and around the hotel to recognize the faces of guests, check registered guest information, identify VIPs and undesirable guests, and alert the hotel staff.

Alerting staff to the arrival of a VIP (via mobile or otherwise), before they check in allows the hotel staff to implement smoother and more appropriate check-in procedures, according to the firm.

The recognition takes less than a second and it can be integrated with the hotel’s loyalty and customer relationship management system so that customers can begin to be catered to in a tailored fashion as soon as they step through the door.

However, it is essentially an opt-in program and guests decide whether if they want to be part of the hotel’s database.

“Some 500,000 guests have been enrolled in the Universal program since June 2014.”

“Ultimately, we’re not selling facial recognition, we’re selling enhanced customer experience that’s enable by face recognition,” explained Allen Ganz, senior account development for the biometric division at NEC North America when queried.

Indeed, according to reports, the customer response has been positive to date and some 500,000 guests have been enrolled in the Universal program since June 2014 with the numbers growing steadily.

Mobile Aspirations

While there are many opportunities available for further evolution, mobile is one area where luxury hotels have excelled of late.

Marriott International introduced a new feature to their mobile app this month with Mobile Request, which operates by offering guests a chat function to make real-time requests at individual hotels and to have immediate responses and interaction.

Additionally, a drop-down menu also allows guests to request services and amenities, such as extra towels and pillows.

Inititally available to 46 hotels worldwide, the new feature will eventually be rolled out to all Marriott hotels this summer and will be available to the 50 million members of Marriott Rewards, the company’s loyalty program.

Dubai Marriott Harbour Hotel & Suites in the UAE, Amman Marriott Hotel in Jordan and Cairo Marriott Hotel & Omar Khayyam Casino in Egypt were some of the first hotels to get the app.

Following in the footsteps of Ritz-Carlton, Starwood, and Marriott, The Four Seasons also just released a new mobile app, a multi-functional global app which acts as a ‘do-everything concierge’, catering to guests’ every whim – from checking in and out, to ordering room service, housekeeping and laundry, to requesting a car from the valet.

Guests can also book luggage pickup and airport transfers or use the content-rich application to peruse local recommendations on individual destinations, curated to their ‘moods’.

Unlike other hotels, The Four Seasons has also set itself apart by not only offering the app across its 94 properties across 39 countries, but also making it available to all users, not just those in the loyalty program.

The luxury chain also plans to release a Simplified Chinese version of the application next month (August 2015), and a special version tailored to the preferences of Chinese travellers will reportedly be issued by the end of the year.

Four Seasons also has plans to provide the app in additional languages down the road, starting with Arabic.
However, it’s interesting to note that Cheng reveals that the Peninsula Hotels Group opted out of the app race – on purpose – to cater to its niche customers’ preferences.

“On purpose – we did not do a native app,” he says. “Because we felt that we wanted to make sure that we were at the guests’ disposal in terms of them being able to get access from their mobile device, but our guests didn’t want extra real estate on their phones dedicated to a Peninsula App, so we did the next best thing and gave them a mobile-optimised site.”

“On purpose – we did not do a native app.”

Switching Off
On this note, it’s clear that while looking to the future is essential – listening to the customer is paramount. Not all customers check into a luxury hotel to be catered to by technology and stimulated by curated content and box-breaking collaborations. Some of them may just want to switch off.

As Jonathan Ford, Founding Creative Partner at Pearlfisher recently pointed out – a survey by BCG claims that 51 per cent of US luxury consumers are now looking for ‘these enriched experiences’ over product, and a new and growing experiential luxury movement is tapping into this.

“Consumers are seeking new ways to take time out, slow down, contemplate and appreciate,” he says.

So, while some hotels are speeding ahead into the future, other luxury operators are experimenting with the opposite and leaning towards a more traditional, yet inspired, offering by allowing guests to truly power off and enjoy the serenity.
  
Villa Stéphanie (Above & Main Image)

German luxury resort Villa Stephanie is one such operator which offers its guests the option to activate an an Internet kill switch in each guest room – marking one of the first times a hotel has offered such a ‘digital detox’.
Check into the Villa and the flick of a switch activates a Wi-Fi grid blocker, which will actively block approximately 96 percent of Wi-Fi signals, and limit texts and tweets.

Eco-hotel, The Adrère Amellal, near Siwa in Egypt has gone a step further and actually banned mobiles from public areas of its premises to ensure that its up-market hotel guests – which have included Prince Charles and the Duchess of Cornwall – are not bothered by ringers, texts or loud phone conversations while on vacation.

The resort – which also has no electricity – only allows mobiles inside the bedrooms, and is made entirely from traditional materials such as salt-rock and palm leaves, relying entirely on torches, beeswax candles and stars to illuminate its 40-rooms, which reportedly start at £460-a-night.
  
  The Adrère Amellal in Egypt

While these customisations may not be the initial images that spring to mind at the sound of the word ‘future’ – it’s far from a long shot to imagine that in years to come, luxury hotels may choose to go down one of two paths – one, leveraging innovative partnerships and technology to trail-blaze modernity, or the other – to offer their guests an opulent and organic respite from a world which is increasingly connected and buzzing around the clock.

One thing, however, is for certain. Wherever luxury hotels choose to innovate next – it will be exciting, because a segmentation is in process – and, as the Amadeus report suggests – it’s all based on personalisation, where the guest is given choice over almost every aspect of their hotel experience.

(C) Luxury Society, by Daniela Aroche, 08 July 2015.

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LUXURY CONGLOMERATES LOOK TO HERITAGE REVIVAL

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Maison Moynat, founded in 1849, revived by LVMH in 2011

James Lawson, director of Ledbury Research, explains why well capitalised entrepreneurs are looking for opportunities with dormant prestige brands

The current economic slowdown, combined with densely crowded prestige markets, has led many entrepreneurs to consider reanimating an old brand rather than creating a new one. This entails acquiring the brand, either to restart its original activities or to use its reputation to start new production.

A brand is normally considered dormant – and, therefore, available for acquisition – if its trademarks have not been used for a number of consecutive years, usually three or five, depending on the country.

By reviving an old brand, entrepreneurs will benefit from its existing brand recognition and equity, usually defined as a combination of positive visual, verbal and emotional associations. That is to say, an historic brand intrinsically carries a sense of heritage, credibility and longevity.


“By reviving an old brand, entrepreneurs will benefit from its existing brand recognition and equity.”


Also, from a financial perspective, unlike the creation of a new brand, the reanimation of an historic brand would require a smaller initial investment to cover marketing costs.

However, reviving an old brand can also present a number of disadvantages. Beyond questioning why the brand died originally, the new products, for example, might not appeal to a younger generation or take into consideration the changes in consumers’ taste.

In addition, using an old brand to commercialise a new range of products could generate confusion in those customers who still associate it with the old products.


“Using an old brand to commercialise a new range of products could generate consumer confusion.”


Recently, the trend of re-launching historic brands has become particularly significant across the luxury industry, especially among major luxury groups that are looking for historic fashion houses with deep roots and a high level of authenticity.

A classic example is Faberge whose brand was long used for fragrances and cosmetics and only recently saw the original production of jewelled eggs restored. Similarly, LVMH acquired Moynat, a luxury leather luggage house that was founded 150 years ago but whose brand had been dormant for the past three decades.

Moreover, following its successful re-launch of the French shoemaker Roger Vivier a few years ago, this year Tod’s resuscitated Maison Schiapparelli, a fashion brand that had been dormant since 1954.


“Reviving historic brands requires a significant initial investment that only major luxury groups could likely contemplate.”


Undoubtedly, reviving historic brands requires a significant initial investment that only major luxury groups could likely contemplate, and in most cases, the name and the logo represent the only elements of continuity between the historic brand and its present incarnation.

Nevertheless, it appears to be a cost-efficient development strategy for companies looking to create an exclusive niche brand characterised by a strong sense of history and heritage.


To further investigate luxury brands on Luxury Society, we invite your to explore the related materials as follows:

2012’s Best Global Luxury Brands
What Makes for a Successful Luxury Re-Brand?
Has Luxury Brand Diversification Gone Too Far?


© Luxury Society, Luxury Conglomerates Look to Heritage Revival, 04 December 2012, by James Lawson.


Ledbury Research
is a research company specialising in the understanding and engaging of High Net Worth Individuals.

Bespoke consumer work spans all forms of quantitative and qualitative research, typically conducted on a multi-country basis, in wealth hubs around the world.

The analyst team delivers market information, trends and analysis through regular reports on the luxury and wealth markets.


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THE LATEST BOUTIQUES: HUBLOT, AUDI & CHANEL

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Dior Homme’s latest store in Miami

Burberry debuts retail as theatre in Chicago, Marni launches in three Chinese Mainland cities, as Hublot takes to the Philippines, United States, China & UAE.

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Audi, Ahmedabad, Dubai

Audi in partnership with Nixynova Motoren Pvt. Ltd have moved into a bigger showroom in Ahmedabad, Gujarat, which will now display entire range of Audi cars that is on offer in the country.

The luxury brand has also opened its largest dealership in Dubai with local dealer Al Nabooda Automobiles, which will be display up to 57 new vehicles over three levels. The Audi Terminal Dubai features floor-to-ceiling screens displaying the complete Audi model range including all equipment options, features and technical details on a 1:1 scale.

Source: Rush Lane, Motor Authority

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Boucheron, Hong Kong

Boucheron has debuted a new retail design concept in Hong Kong, a model that will be replicated across all the brand’s stores starting with an overhaul in Paris. The 80sqm space has been designed with luminosity in mind, harking back to the first atelier on Paris’ Place Vendome, where the workshop was flooded with light that highlighted the brilliance of the stones.

Source: FashionMag

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Breguet, Abu Dhabi

Breguet has unveiled its latest boutique in Abu Dhabi, located in the high standing commercial building “Etihad Towers”. The 32nd monobrand boutique worldwide showcases a mix of timepieces and gem-set Haute Joaillerie creations across 60sqm, in keeping with its global retail design concept launched in 2012.

Source: Breguet
Burberry, Chicago

Burberry has launched its second largest store in North America in Chicago, meshing digital, entertainment and fashion in one seamless experience across five-floors. The store houses the first beauty consultation counter in North America and will carry an exclusive, limited edition collection of outerwear and non-apparel for both men and women, created to celebrate Burberry in Chicago.

Source: Brand Channel

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Chanel Timepieces, Paris

Chanel has opened its first dedicated watch store in Europe on the first floor of Paris department store Galeries Lafayette, to house its Première and J12 lines in addition to the new Mademoiselle Privé collection. The 25sqm concession is decorated in the brand’s signature black, beige and gold.

Source: WWD

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Chopard, Abu Dhabi

Chopard has launched its latest boutique at Abu Dhabi’s Marina Mall, in partnership with Abu Dhabi distributor Al Manara International Jewellery. Created by architect Thierry Despont, the décor reflects that of a welcoming living room boasting fine woods for the floors and leather for the wall panels, store fixtures and furniture fronts and luscious velvet for curtains and upholstery.

Source: Luxos

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Christian Louboutin, London

Christian Louboutin has unveiled its first store dedicated to men in the United Kingdom, to carry a range of shoes, sneakers, bags and accessories. The 170sqm Dover Street flagship has been realised by New York architects 212box, the same architects responsible for Christian Louboutin stores worldwide.

Source: FashionMag

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Dior Homme, Miami

Dior Homme is the latest brand to launch in Miami’s new Design District, showcasing sleek architecture, minimalist decor, and luxe materials. To highlight the opening, Dior Homme collaborated with artist and photographer, Bruce Weber, to curate an exclusive film titled, “Can I Make the Music Fly,” that can be viewed here.

Source: The Fashionisto

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Elie Saab, Geneva

Elie Saab has opened a new 155sqm boutique overlooking Lake Leman in Geneva, Switzerland. Saab himself, in collaboration with architect Chakib Richani, has designed the dual-level space. The store will showcase the designer’s accessories and ready-to-wear items from both the autumn and winter 2012-2013 and pre-fall 2012 collections.

Source: VMSD

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Eterniti, London

London-based boutique luxury carmaker, Eterniti Motors, has officially launched its first showroom with a 930sqm facility in Park Royal, northwest London. Eterniti-owned showrooms will open in Asia in 2013, beginning with Hong Kong, which will serve as the company’s Asia-Pacific hub.

Source: Eterniti

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Georg Jensen, London

Danish luxury lifestyle brand Georg Jensen, has unveiled its newest concession in Selfridges, London, designed by British architects Mark Pinney Associates. The 20sqm space is housed within the store’s designer jewellery room, showcasing fine jewellery, luxury fashion jewellery as well as the heritage range and contemporary silver pieces.

Source: Retail Jeweller

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Gucci, Gurgaon

Gucci has opened its fifth and largest store in India at The Oberoi in Gurgaon, New Delhi, in keeping with the new design concept by Creative Director Frida Giannini. The near-400sqm space has been realised in ribbed glass, warm polished gold, smoked mirror and smoked bronze glass, recalling the elegance and richness of the Art Deco era.

Source: Daily Mail

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Hublot, Atlanta, Abu Dhabi, Dalian, Manila

Hublot has unveiled the first of five North American boutiques to open in the coming three years, with a 92sqm space in Atlanta, operated in partnership with Ares Distributors. The brand has also opened a second boutique in Abu Dhabi, and a second boutique in Dalian, in partnership with Jinhua Watch & Jewellery.

Finally, the very first Hublot boutique in the Philippines has debuted at the newly opened Bonifacio High Street Central mall, Manila. The boutique design concept creatively reflects Hublot’s DNA of luxury and innovative design, bringing to life its vision of fusion.

Source: Hublot

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Ittierre, Milan

Ittierre Group – producer of contemporary lines such as Pierre Balmain, C’N’C, Aquascutum, GF Ferré, Galliano and Karl Lagerfeld Paris – has debuted its first temporary department store in Milan. Housed over 1000sqm in Palazzo Gallarati Scotti, IT’S 30 MANZONI will offer principal collections of the group’s licensed brands.

Source: Vogue Italia

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IWC, Beijing, Miami, Sao Paulo

IWC has unveiled flagship boutiques in Beijing, Miami & Sao Paulo. The Beijing store features a 300sqm bi-level glass cube facade, a brainchild of in-house designers and architects. Each boutique is fitted out with sumptuous dark woods and exquisite materials, inviting customers to explore the six fascinating watch families along with boutique-exclusive editions.

Source: IWC

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Jaguar Land Rover, Beijing

Jaguar Land Rover has inaugurated its100th retail space in China, with the Beijing Changjiushida 4S Center in the heart of the city. The state-of-the-art repair centre and showroom, operated in partnership with the Changjiu Group, will have a workforce of around 110 people.

Source: Luxuo

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Jitrois, Beijing

In partnership with Keyijili Ltd, Jean-Claude Jitrois has opened a flagship store in Beijing, marking the brands first boutique in Asia. The 250sqm space has been designed by Christophe Pillet, the architect responsible for all of the brands stores, in a luxury shopping centre in the Chaoyang district of the Chinese capital.

Source: FashionMag

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Marni, Nanjing, Shanghai, Shenyang

Marni has unveiled three Chinese flagship boutiques, in Shanghai’s REEL shopping centre, Nanjing’s Deji Plaza and a store in Shenyang, brining its presence to nine locations in the country. Marni creative director Consuelo Castiglioni worked closely with architecture firm Sybarite, the creators of the brand’s Beijing store, to create the spaces.

Source: Luxuo

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Montblanc, Abu Dhabi

Montblanc has opened its latest boutique in Abu Dhabi, United Arab Emirates, offering the exclusive Bespoke Nib Service, which is currently available in just four Montblanc boutiques worldwide. The store will house luxury watches, jewellery and leather goods, as well as writing instruments and its customisation service. Curacao boutique pictured

Source: Luxos

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Pucci, New York City

Pucci creative director Peter Dundas has unveiled the world’s largest Pucci store in New York, designed in collaboration with French architect Joseph Dirand, modelled after the Palazzo Pucci in Florence. The 250sqm store will form the design basis for future retail locations and feature the entire collection of Pucci ready-to-wear and accessories.

Source: Bloginity

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TAG Heuer, Geneva

TAG Heuer has opened its first boutique in Geneva, with a 100sqm space located on Rue Robert-Céard. The store will house the brand’s Lifestyle collection of accessories, as well as a range of sunglasses and luxury communication devices, Meridiist, Link and Racer, specially conceived by TAG Heuer.

Source: FHH

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Vacheron Constantin, Lucerne

Vacheron Constantin has chosen Lucerne, in German-speaking Switzerland, for its latest boutique at 10 Kapellplatz. This warm and intimate setting is designed to offer a full immersion into the world of a company combining tradition with dynamic creativity.

Source: FHH

For more in the series of The Latest Boutiques, please see our most recent editions as follows:

The Latest Boutiques: Chloé, Brioni & Shang Xia
The Latest Boutiques: Berluti, Dior & Saint Laurent Paris
The Latest Boutiques: Hublot, Breguet & Assouline


© Luxury Society, The Latest Boutiques: Hublot, Audi & Chanel, 10 December 2012, by Sophie Doran.


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HOW THE LUXURY INDUSTRY IS LEAVING $1.7 TRILLION ON THE TABLE

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Douglas Gollan, co-founder of Elite Traveler magazine, explains why the luxury industry’s continued robust performance is coming, despite largely missed opportunities.

My mother used to always tell me I succeeded “in spite of myself.” It was her way of telling me while my intentions and instincts and many of my actions may have been right, I was making whatever the task was more difficult than it had to be.

One could argue that the luxury industry’s continued robust performance is coming despite missing some large opportunities.

A recent report by wealth researcher Wealth-X found some 185,000 households worldwide with a Net Worth of at least $30 million. These families – commonly referred to as UHNW – or Ultra High Net Worth – cumulatively are worth between $25 Trillion and $40 Trillion depending on which report one reads.

They are without doubt the “heavy users” of luxury goods and services simply because they can afford to be. After all, who else is spending $5,000 a night on suites at luxury hotels and buying $50,000 watches or $80,000 necklaces. A 2011 Washington Post research project found that U.S. households in six major markets couldn’t make ends meet despite having a Household Income of $250,000, a level considered fairly robust by media buyers.


“ Ultra High Net Worth’s are without doubt the “heavy users” of luxury goods and services simply because they can afford to be.”


The kicker was that these families didn’t even have luxury cars, didn’t buy designer fashion and had an annual vacation budget of just $3,000. In New York this Mass Affluent family was running a deficit of nearly $30,000. In other words, there was very little upside marketing to these consumers. Hundreds of brands were competing for one or two luxury purchases per year, generally for no more than a couple thousand dollars.

Greg Furman, the Founder and CEO of The Luxury Marketing Council recently told me, “luxury companies need to be more focused on selling more watches to the person who already buys a half dozen watches a year than the first watch to a person who can’t pay his rent.” He added, that as luxury companies extend their product ranges they need to invest more in educating UHNW consumers, including advertising. He uses the term “share of wallet.”

As part of a white paper I am currently working on, we are trying to understand how much these UHNW households currently spend cumulatively across a variety of luxury product and service categories – and how deep their pocket books truly are. In other words, how much more could they spend if properly educated and motivated.


“ Hundreds of brands were competing for one or two luxury purchases per year, generally for no more than a couple thousand dollars ”


The categories we are looking at include automotive, jewelry, watches, fashion and accessories, hotels, resorts, spas, villas, adventure travel, yacht rentals (not purchases), renovating and refurnishing residences and collectibles.

Obviously there is a lot of guesswork with the formulas but using research we did with Prince & Associates that included personal interviews with over 600 private jet and fractional jet owners, the current figure comes out at around $300 billion annually. That would equate to about $1.6 million in spending for each of these 185,000 UHNW households. It would also register at only around one percent or less of Net Worth.

Interestingly, as we look at numerous other surveys of luxury lifestyle spending from Ipsos, American Affluence Research Center and Unity Marketing with Mass Affluent consumers to create a range of scenarios, we believe that the potential spending of these UHNW families could be over $2 trillion!

For the Global CEO of any major luxury brand or conglomerate, I feel pretty sure they all have well developed strategies for China and E-marketing. These are considered key areas all luxury companies need to be focused on. However, I am not sure if I would find any of these same, successful companies having a Global UHNW Marketing Officer responsible for a Global UHNW strategy with a single focus to get more spend from these UHNWs and centralized authority.


“ Luxury brands have well developed strategies for China & e-Marketing, but how many have a global UHNW strategy?”


Yes, I know there are the polo sponsorships and at the country level lots of wining and dining and event invites for key customers. What I think has slipped through the cracks is these best prospects are now not in town or even in the country most of the time. I always like to say “private jets set the rich people free.” And in fact, one Richemont executive I met with referred to this group as “Homeless with 20 Homes.” Burberry has dubbed them the TLCs, short for Traveling Luxury Consumers. Global Nomads is another moniker.

Mykolas D. Rambus, CEO of Wealth-X, was right to the point: “The growing trend of the ultra wealthy choosing to establish residences in the most cosmopolitan cities around the world has implications for all professionals operating in the financial services and luxury sectors. Professionals need to understand these ultra wealthy clients, who defy being categorized by geographical location, should they wish to create consistent strategies of approach.”

Luxury houses today are still structured on a country basis with lots of country management and lots of local focus. It is not uncommon to be questioned, ‘what if your readers buy when they are in another country?’ I do understand everyone has their own revenue targets to hit. Being a global magazine, it means that some readers who are ‘based’ in the U.S. may in fact buy when they go to London or Hong Kong but at the same time readers from South America, the Middle East or Europe probably do a good deal of their buying in the U.S.


“ It’s easier to sell lots of stuff to rich people than poor people – Milton Pedraza, CEO, The Luxury Institute.”


It underscores the point that the luxury companies are enjoying success ‘despite themselves.’ Clearly, as Rambus notes, these UHNW families live a global lifestyle. A recent Financial Times piece profiled a couple who hop from London to Venice for lunch if it looks like a rainy day, and reported that today’s Super Rich follow the good weather, good schools, good tax regimes and good entertainment as they fly around on their private jets.

Milton Pedraza, the CEO of Luxury Institute once told me, “It’s easier to sell lots of stuff to rich people than poor people.” Even if the numbers I am looking at are wrong by double, luxury brands are leaving about $850 billion in sales in the pockets of UHNW customers who just need to be motivated to spend. Either way, it’s a bigger opportunity than China, bigger than the Internet, and right out there every day around the world at the nearest FBO. That’s the acronym for private jet terminal.


To further investigate Wealth & Affluence on Luxury Society, we invite your to explore the related materials as follows:

The Dangers of Homogenising the Wealthy: Ledbury Research
Key Insights from The Wealth Report 2012
Luxury’s Mixed Messages in a Yo-Yo Economy


Douglas Gollan is Group President and Co-Founder of Elite Traveler Media Group, launched in 2001, based in New York. The company publishes Elite Traveler, the private jet lifestyle magazine, with BPA audited distribution in over 100 countries worldwide by private jet.

It also publishes an Asia Edition of Elite Traveler, Elite Traveler Superyachts, Elite Traveler Hotels/Resorts/Spas Annual, Elite Traveler Annual Watch Guide and hosts over 60 Destination Guides for UHNW consumers at Elitetraveler.


© Luxury Society, How The Luxury Industry Is Leaving $1.7 Trillion On The Table, 28 June 2012, by Douglas Gollan.


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THE LATESTS BOUTIQUES: SOTHEBY’S, SHANGHAI TANG & SALVATORE FERRAGAMO

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IWC’s first U.S. flagship on Madison Avenue, New York City

The Latest openings from Armani Casa, Vacheron Constantin, Roger Vivier, IWC and Jimmy Choo, in Miami, Beijing, Costa Mesta, Milan, New York & Hong Kong

Cautious whispers of a slowdown in China have rippled through the luxury industry, despite the stellar performance of luxury goods in 2012. Ledbury Research recently confirmed the increasingly wary attitudes of luxury brand CEO’s, and pointed out that while sales have increased, in many cases market share has declined.

CLSA Asia-Pacific Markets explicitly disagrees, saying Chinese consumers will continue to purchase watches, handbags, jewellery and expensive clothes. “Wealthy individuals won’t slow down their spending,” remarked CLSA analyst Aaron Fischer to the Wall Street Journal. Barring a terrorist attack, pandemic or corruption crackdown, China will continue to lead the boom in luxury goods for years to come, according to the firm’s research.

And if brick-and-mortar store openings are anything to go buy, the luxury industry still believes in the promise of China. Vacheron Constantin this month opened its third boutique in Beijing alone, as Michael Kors launched in the city’s Shin Kong Place shopping mall and Roberto Cavalli in the Peninsula Hotel. Zegna moved into tier-2 city Shenyang, as Lancel launched a new concept store in Shanghai.

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Armani Casa, Miami

Armani Casa has moved into Miami’s new design district, with a 340sqm space at 10 NE 39th Street. It is the first Armani Casa store in Miami and the third in the United States. The store will house a range of furniture decor, tableware, decorative accessories, fabrics, ornaments, lighting and bathroom and kitchen products, as well as offering the brands “made to measure” interior design service.

Website: armanicasa.com
Source: WWD

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Dior Homme, New York

Dior Homme has launched a pop-up space in New York’s SoHo, whilst its 57th Street undergoes renovation. The Greene Street location features ready-to-wear, footwear, eyewear, leather goods, watches, jewellery and fragrance. Creative Director Kris Van Assche has selected a piece by Robert Montgomery to display in the boutique.

Website: dior.com/homme
Source: Fashion Windows

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Jimmy Choo, Hong Kong

Jimmy Choo has unveiled its first dual gender store, after expanding and renovating its boutique in Hong Kong’s Elements mall. The storefront features side-by-side entrances for women and men’s, each with its own dedicated shopping environment. The reimagined store is the first retail opening managed wholly by Jimmy Choo Hong Kong Limited, the venture created following the acquisition of the shareholding from joint venture partner Bluebell.

Website: jimmychoo.com
Source: Choo Connection

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IWC, New York

IWC Schaffhausen has opened its first US flagship in New York City at 535 Madison Avenue. The NYC store is the first of its kind, presenting the company’s watch families – Aquatimer, Pilot’s Watches, Portofino, Ingenieur, Da Vinci, and Portuguese – in themed settings that reflect their individual character.

Website & Source: iwc.com

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Lancel, Shanghai

Lancel has launched a concept store in Shanghai, designed by Christopher Pillot, who dressed the Champs-Elysees maison. The boutique features a handcrafted Murano glass chandelier and stained-glass panels, hand-painted by French artist Caroline Pregermain. Elsewhere oak flooring, brushed metals, LED lighting and vegetal furniture leathers house the brand’s accessories.

Website: lancel.com
Source: Luxury Insider

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Lamborghini, Moscow

Lamborghini has contracted with the Burevestnik Group, a luxury automobile and yacht retailer located in Moscow, to become Lamborghini’s first official dealership. A temporary sales operation has been launched in the Crocus City Mall whilst the group finalises construction of a Moscow showroom. The completed dealership will house sales, service and accessory sales for the complete Lamborghini product line-up. (Newport Beach dealership pictured)

Website: lamborghini.com
Source: Motor Authority

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Max Mara, Bucharest

Max Mara has launched a flagship store in Bucharest, which houses the Max Mara line alongside SportMax. The brand formerly operated a small store on Calea Victoriei in partnership with Alsa Group, but this new launch makes its presence in Romania one of its largest in Eastern Europe. (Paris boutique pictured)

Website: maxmara.com
Source: CPP Luxury

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Michael Kors, Beijing

Michael Kors has opened his first store in Beijing and its largest in China, located in the Shin Kong Place shopping mall. The 225sqm store retails accessories and ready-to-wear from both the main and diffusion lines and features a large format video screen showing the designer’s runway shows.

Website: michaelkors.com
Source: WWD

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Odin, New York

Niche perfume brand Odin New York has opened its first pop-up shop in collaboration with Snarkitecture. The pop up shop will remain open for six weeks, and will include all six of Odin’s unisex and home fragrances. The aim of the boutique is to showcase the product design by inverting the darkness of the packaging resulting in a bright, clean space.

Website: odinedt.com
Source: Bois de Jasmine

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Prada, Porto Cervo

Opening its second store in the Italian holiday destination of Porto Cervo, Prada has inaugurated a 95sqm space dedicated to menswear and accessories on La Passeggiata, the town’s luxury shopping street.

Website: prada.com
Source: CPP Luxury

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Roberto Cavalli, Beijing

Italian fashion designer Roberto Cavalli has opened the first phase of his debut store in China, within the arcade of the Peninsula Hotel, Beijing. The 300sqm space houses women and men’s ready-to-wear, as well as accessories, eyewear, perfumes, timewear and kidswear collections.

Website: robertocavalli.com
Source: Fashion United

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Roger Vivier, Costa Mesa

Roger Vivier has opened its third U.S. boutique, and its first in California, within the South Coast Plaza luxury mall in Costa Mesa. The 92sqm space features the brand’s seasonal footwear and accessories collections, as well as the limited-edition Rendez-Vous line for traveling.

Website: rogervivier.com
Source: WWD

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Salvatore Ferragamo, New York City

Salvatore Ferragamo’s largest boutique – its Fifth Avenue flagship – has reopened following 13th weeks of renovation. The 1,900sqm space features womenswear, menswear, accessories, shoes, and also the recently launched fine jewellery collection. The brand also used the occasion to debut the Travel Luggage Collection, set to launch this summer.

Website: ferragamo.com
Source: Style Rumor

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Shanghai Tang, Hong Kong

Shanghai Tang has launched a three-storey Mansion in Hong Kong, celebrating modern elegance and fashion through colours, exquisite fabrics, unique designs and prints. Womenswear occupies space on the ground and first floors, featuring a curved ceiling, a peony brass-inlay on the wooden flooring, fan-patterned screens and semi-circular seating.

Evoking a discreet gentleman’s club in warm hues, the calm, masculine Men’s wear floor offers ample leather seating, as well as an embossed dragon, a Chinese symbol of power.

Website & Source: shanghaitang.com

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Sotheby’s, Hong Kong

Sotheby’s is soon to open a 1,400sqm permanent exhibition space in Hong Kong, and will celebrate with a string of exhibitions running through the end of May. The gallery will occupy the entire fifth floor of One Pacific Place, the massive space will become a sort of HQ for the global auction house to expand its presence in Asia beyond its current biannual auction series in April and October.

Website: sothebys.com
Source: Jing Daily

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Vacheron Constantin, Beijing

Vacheron Constatin has unveiled its third flagship Beijing, on the ground floor of Beijing Macau Center, bringing the total number of stores worldwide to 30. The opening also coincided with the arrival of three special edition watches in Beijing and at the store, including the newly launched Patrimony Traditionnelle 14-Day Tourbillon, Métiers d’Art Kalla Haute Couture à Pampilles and the Patrimony Traditionnelle Calibre 2253.

Website: vacheron-constantin.com
Source: Luxury Insider

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Zegna, Shenyang

Ermenegildo Zegna recently celebrated the opening of its fourth China flagship, in the north-eastern luxury hotspot Shenyang. The 505sqm space within Shenyang’s MixC mall has been designed by architect Peter Marino, divided into three sections for each of Zegna’s brands: Ermenegildo Zegna suits and accessories, Z Zegna, and Z Sport.

Website: zegna.com
Source: Jing Daily

For more in the series of The Latest Boutiques, please see our most recent editions as follows:

The Latest Boutiques: Chanel, Tom Ford & Valentino
The Latest Boutiques: Céline, Chaumet & Elie Saab
The Latest Boutiques, Burberry, Bally & Boucheron


© Luxury Society, The Latest Boutiques: Sotheby’s, Shanghai Tang & Salvatore Ferragamo, 09 May 2012, by Sophie Doran.


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THE LATEST APPOINTMENTS: CARTIER, CACHAREL & CHRISTIAN DIOR

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Raf Simons has been appointed as creative director of Christian Dior, succeeding John Galliano.

 

The Latest Appointments at Starwood Hotels, Christie’s, Bergdorf Goodman, Cartier, YSL Beauté, Sonia Rykiel, PPR, Bentley Motors, Akris & Cacharel

The Dior saga is finally over. After one year of speculation – where everyone from Riccardo Tisci, Marc Jacobs, Kayne West, Alber Elbaz, Alexander Wang and even the disgraced Galliano himself were rumoured to be taking the top spot – Raf Simons has been confirmed to head womenswear and haute couture, whilst Kris Van Assche continues to head design at Dior Homme.

Over at Richemont, group manufacturing director Jan Rupert is stepping down to focus on other activities and to broaden his remit within the family of companies controlled by Johann Rupert. Whilst Mr. Rupert will remain an executive director of the group, Richard Lepeu, Richemont’s deputy chief executive, will oversee the group’s manufacturing strategy as of April 1.

At PPR, Gucci America’s president Laura Lendrum has resigned to pursue other opportunities according to WWD. Ms. Lendrum joined Gucci in 1997, and moved to Yves Saint Laurent America as president in 2001. Gucci president and chief executive officer Patrizio di Marco will oversee the Americas region in the interim until the company names a successor.

Raf Simons, Creative Director, Dior

Ending a year of speculation, Belgian designer Raf Simons has been named as the next artistic director of Christian Dior, following his recent exit from Jil Sander. Mr. Simons will be in charge of haute couture, women’s ready-to-wear and accessories, starting with the couture show in July, while keeping his eponymous men’s line. Kris Van Assche remains in his position at Dior Homme.

Source: NYTimes
Stanislas de Quercize, CEO, Cartier

Cartier has appointed Stanislas de Quercize to take over from Bernard Fornas as chief executive of top-of-the-range jewellery and watchmaker Cartier. Mr. De Quercize is currently serving as CEO of fellow Richemont subsidiary Van Cleef & Arpels, and will replace Mr Fornas at the end of the year, when he is due to retire.

Source: Reuters
Joshua Schulman, President, Bergdorf Goodman

Following his departure from Jimmy Choo in late 2011, Joshua Schulman has been named president of U.S. luxury retailer Bergdorf Goodman. Prior to his tenure as CEO of Jimmy Choo, Mr. Schulman served as executive vice president at the Gucci Group, where he oversaw worldwide merchandising and wholesale for Yves Saint Laurent, and served as worldwide director of Gucci women’s ready-to-wear.

Source: WWD
Stephan Bezy, General Manager, YSL Beauté

Joining the Management Committee of L’Oreal Luxe, Stephan Bezy has been appointed International General Manager of Yves Saint Laurent Beauté. Mr. Bezy joined L’Oréal in 1991 and has since served as global President at Redken, International General Manager at Shu Uemura and General Manager of Cacharel.

Source: Premium Beauty News
Management Team, Starwood Hotels & Resorts

Starwood has restructured its executive team following the retirement of three senior leaders, Matt Avril, President of the Hotel Group; Denise Coll, President of Starwood North America; and Miguel Ko, Chairman and President of Starwood Asia Pacific.

Currently president and CEO of Starwood Vacation Ownership, Sergio Rivera, has been promoted to co-president of Starwood Americas. Osvaldo Librizzi who assumes primary responsibility for Latin America joins him as co-president of Starwood Americas. Stephen Ho, currently Senior Vice President of Acquisitions and Development for Starwood China, has been promoted to President of Asia Pacific. And finally currently head of Starwood’s operations for China, Qian Jin, has been promoted to the title of President of Greater China.

Source: PR Newswire
Vincent Gillet, Brand Chief, W & Le Meridien

Starwood has appointed Vincent Gillet as brand chief for W Hotels and Le Meridien brands, replacing Eva Ziegler. Mr. Gillet has spent the last two decades working on well-known luxury brands for LVMH, Chanel and Pernod Ricard, followed by a three-year tenure as chief marketing officer at Six Senses Resorts & Spas.

Source: USA Today
Eric Langon, Managing Director, Sonia Rykiel

Eric Langdon has been appointed as managing director of Sonia Rykiel effective April 16, where he will report to CEO Jean-Marc Loubier, also CEO of Fung Brands, which acquired an 80 per cent stake in the French fashion house in February. Most recently Mr. Langon served as chief operating officer at Lancel.

Source: WWD
Katrina Burchell, Intellectual Property Director, PPR

Katrina Burchell has been charged with the task of re-organising and monitoring PPR’s Intellectual Property function, joining the French conglomerate as Intellectual Property Director. Prior to her appointment, Ms. Burchell headed the Trademarks, copyrights and domain names at Unilever group.

Source: 4-Traders
Emile Rubenfield, CEO, Carolina Herrera

Emilie Rubinfeld has been appointed vice president of global marketing and communications, in a newly created title at Carolina Herrera. Most recently Ms. Rubinfeld served as senior vice president of marketing and communications at Akris, following tenure as vice president of marketing at Giorgio Armani Corp.

Source: WWD
Jinqing Caroline Cai, Managing Director, Christie’s China

Auction house Christie’s has appointed its first managing director in China, Jinqing Caroline Cai, effective June 1. A founder of the Brunswick Group, a global PR firm in Beijing, Ms. Cai will manage the office and oversee all activities involving the Chinese marketplace.

Source: JustLuxe
Katie Reed, Associate Vice President, Akris

Katie Reed has joined Akris as associate vice president of marketing and communications, following service at Patek Philippe North America, as public relations and communications director. Ms. Reed will oversee all areas of marketing, advertising, public relations and special events in the U.S.

Source: WWD
Kevin Rose, Sales & Marketing Chief, Bentley Motors

As part of a reshuffle of senior marketers within Volkswagen Group UK, Kevin Rose has joined Bentley Motors as its new board level sales and marketing chief, taking over from Alasdair Stewart. Mr. Rose joins from parent group Volkswagen’s China business, where he was executive vice president for sales.

Bentley has also named Andrea Baker as head of media relations, who most recently served as head of public relations with Porsche Cars Great Britain.

Source: Marketing Week
Source: JustLuxe.com
Pascal d’Halluin, CEO, Cacharel

Pascal d’Halluin has been appointed chief executive officer of Cacharel, succeeding managing director Marc Ramanantsoa, effective March 19. Mr. d’Halluin worked with L’Oréal for eight years before taking over as CEO of Lee Cooper France in 1994.

Source: Just Style
Michael Burgess, President, Saks Direct

Saks Inc. has named Michael Burgess president of Saks Direct, reporting to Denise Incandela, executive vice president and chief marketing officer. Mr. Burgess was most recently led merchandising, marketing, consumer information technology and other functions of the consumer division of FTD, the florist, which is owned by United Online Inc.

Source: WWD
Michael Kingston, SVP & CIO, Neiman Marcus

Neiman Marcus Group has named Michael R. Kingston senior vice president and chief information officer, succeeding Phillip Maxwell, who earlier this month announced his retirement. Earlier, Mr. Kingston served as vice president, applications at Coach Inc. and international director of information services at LVMH Moët Hennessy Louis Vuitton.

Source: WWD

For more in the series of The Latest Appointments, please see our most recent editions as follows:

The Latest Appointments: Givenchy, Jil Sander & Yves Saint Laurent
The Latest Appointments, Pucci, Tod’s & Girard-Perregaux
The Latest Appointments, Bulgari, Labelux & Net-a-Porter


© Luxury Society, The Latest Appointments: Cartier, Cacharel & Christian Dior, 17 April 2012, by Sophie Doran


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