With roughly 13 million individuals worldwide, HNWI represent a micro niche of less than 1% of the worlwide population. However all together HNWI count for more than 20% of the worldwide wealth.
While initially mainly concentrated in western countries and so called countries of old money, HNWI are nowadays spread across the globe in cities such as Tokyo, Honk Kong, Dubai, London, Sao Paulo and Los Angeles just to name few of them. Furthermore the rise of emerging countries over the last few decades has triggered the development of a class of 'nouveau riche' in the far and Middle East as well as in south America.
Brands that have identified HNWI as a growth opportunity often face a similar question: how to successfully attract and to sustainably engage with HNWI?
Below are selected aspects of HNWI's expectations to take into consideration:
Stand out from the crowd and the brands proliferation: the label of exclusivity (e.g. black) or the financial threshold are some examples of the mix that will make a brand perceived and chosen as a premium one.
Consumer doesn't mean purchaser: depending on the category we often notice that the final consumer may not always be the purchaser. For example in the financial industry, intermediaries such as family offices play a major role in the purchase decision. More than for any other customer segment, premium brands need to deeply understand the buying decision process of HNWI to ensure that the purchase experience is adequate.
Sense of exclusivity: rare vintage wine, limited edition of spirits or exclusive advisory would typically drive the sense of exclusivity required by a majority of HWNI. Premium brands have to embed in their value proposition for HNWI a set of features (products or services) that conveys this sense of exclusivity.
Price matters…if it's worth it: although wealthy people have access to larger financial resources, they don’t systematically opt for spontaneous purchases. The value for money is an important aspect of their buying decision process even for emotional purchases (e.g. art collection is perceived as a passion investment). That's why the price positioning has to be defined based on the perception of the benefits (material and emotional) from the customer's point of view.
Values and beliefs: a majority of HNWI stands in the upper part of Maslow’s pyramid. Typically HNWI will care about the impact of their purchase on the society (e.g. fair-trade), or the alignment of brand values with their own ones. Depending on the category, brands targeting HNWI need to clearly understand their expectations regarding values and beliefs.
Investments needs: HNWI are often very sophisticated when it comes to their investments choices and needs. Investments solutions for this segment has to embed not only the
technical and performance aspects but also the emotional features such as the trust for example.
More than other customers segments, the Client Experience (CX) for HNWI and Luxury Shoppers is a key element of the value proposition to them and retention and differentiation factor.
Those segments are highly solicited and just delivering a premium product or service makes it a commodity within the luxury category. Therefore defining a premium or luxury experience and deliver
against it provides a competitive advantages for any brands who target luxury shoppers and HNWI
A full-fledged premium experience: defining the whole experience that meets and exceeds the HNWI and Luxury Shoppers expectations drives a stronger loyalty as it will based on
not only what is delivered but also creates a stronger emotional bond to the brand and there for makes it less 'comparable'
Consistent and systematic delivery: a key component of a success CX delivery is the ability for a brand to ensure the experience is delivered systematically to the client that it
perceives it as a part of the brand. The other aspect is the consistency across geographies and channels as Luxury shoppers and HNWI are often global players.