CONSUMERS

Super Rich Get Even Richer

by

Lucy Archibald

|

This is the featured image caption
Credit: This is the featured image credit

The world’s richest individuals distance themselves even further financially from the rest of the pack.

Over the last decade, collaborations between luxury brands and contemporary artists have gone beyond mere artistic partnerships towards a new kind of luxury branding.

PARIS – Art and fashion have always developed side by side, for fashion, like art, often gives visual expression to the cultural zeitgeist. During the 1920s, Salvador Dalí created dresses for Coco Chanel and Elsa Schiapparelli. In the 1930s, Ferragamo’s shoes commissioned designs for advertisements from Futurist painter Lucio Venna, while Gianni Versace commissioned works from artists such as Alighiero Boetti and Roy Lichtenstein for the launch of his collections. Yves Saint Laurent’s vast art collection, recently auctioned at Christie’s in Paris, testified to his great love of art and revealed the influence of a variety of artists on his own designs.

In the 1980s, relationships between luxury brands and artists were advanced when Alain Dominique Perrin created the Fondation Cartier. In the Fondation Cartier pour l’Art Contemporain, a book marking the foundation’s 20th anniversary, Perrin says he makes “a connection between all the different sorts of arts, and luxury goods are a kind of art. Luxury goods are handicrafts of art, applied art.”

The Fondation Cartier pour l’Art Contemparain building in Paris

The world’s richest individuals distance themselves even further financially from the rest of the pack.

The world’s richest individuals distance themselves even further financially from the rest of the pack.

Despite the mood that has pervaded the lives and businesses of most people in the developed world in the past year, the world’s billionaires and millionaires have in fact got even richer. They now total 10 million individuals, who saw their overall wealth rocket 18.9% last year to $39 trillion — an almost ludicrously high figure, which flies in the face of the global recession.

While the relatively modest $1 million wealth bracket grew by 17%, the super rich (those with assets exceeding $30 million) did even better with their wealth increasing by 21.5%. This select financial elite had fortunes averaging $150 million each, which is particularly remarkable when you consider that the category begins at a ‘mere’ $30 million. For the average to be five times in excess of this, those at the top of the bracket must be very rich indeed.

This recent leap in the ultra rich’s collective wealth comes despite the fact that it was also the very rich who took the bigger hit in 2008, losing 245 of their fortunes. You need to be brave, it would seem, to play with the high-rollers.

The geographical distribution of the rich and very rich is also reflective of recent changes in global demographic structure. For the first time there were as many (three million) millionaires in Asia as there were in Europe, although Asia’s rich controlled $9.7 trillion at the end of 2009, compared with the $9.5 trillion held by their European counterparts. Japan had the second-largest group of millionaires, totalling 1.65 million, while Germany came in third, with 861,000. China came in fourth, with 477,000 millionaires, edging past Britain with 448,000. The millionaire’s sun is certainly rising in the East.

The ramifications for the luxury industry seem clear- there is profit to be made in a spectacular wealth category, which is increasingly separate from the rest of the world and apparently subject to their own economic mirco-climate. And while investment needs to be targeted geographically, it is perhaps emerging millionaire hubs that need to be targeted as much as whole emerging economies.

For wealth management companies the competition will be fierce but the rewards will also be enormous. But there are already signs that this trend is impacting at a fashion and retail level. LS recently spoke to a luxury jewellery designer who had been counter-intuitively advised by a senior industry expert to raise their prices, during this time of alleged penny pinching and luxury shame, in order to appeal to a demographic or consumer category that looked like it still had some growth in it — ‘the price insensitive’.

Rather than looking into cheaper diffusion lines, maybe luxury brands should be looking at stretching themselves to provide goods and services at the very top of the market. What could your brand do to appeal to the man or woman who has everything, and a fairly significant tranche of the world’s total wealth?

Sources
New York Times

Lucy Archibald
Lucy Archibald

Associate Editor

CONSUMERS

Super Rich Get Even Richer

by

Lucy Archibald

|

This is the featured image caption
Credit : This is the featured image credit

The world’s richest individuals distance themselves even further financially from the rest of the pack.

Over the last decade, collaborations between luxury brands and contemporary artists have gone beyond mere artistic partnerships towards a new kind of luxury branding.

PARIS – Art and fashion have always developed side by side, for fashion, like art, often gives visual expression to the cultural zeitgeist. During the 1920s, Salvador Dalí created dresses for Coco Chanel and Elsa Schiapparelli. In the 1930s, Ferragamo’s shoes commissioned designs for advertisements from Futurist painter Lucio Venna, while Gianni Versace commissioned works from artists such as Alighiero Boetti and Roy Lichtenstein for the launch of his collections. Yves Saint Laurent’s vast art collection, recently auctioned at Christie’s in Paris, testified to his great love of art and revealed the influence of a variety of artists on his own designs.

In the 1980s, relationships between luxury brands and artists were advanced when Alain Dominique Perrin created the Fondation Cartier. In the Fondation Cartier pour l’Art Contemporain, a book marking the foundation’s 20th anniversary, Perrin says he makes “a connection between all the different sorts of arts, and luxury goods are a kind of art. Luxury goods are handicrafts of art, applied art.”

The Fondation Cartier pour l’Art Contemparain building in Paris

The world’s richest individuals distance themselves even further financially from the rest of the pack.

The world’s richest individuals distance themselves even further financially from the rest of the pack.

Despite the mood that has pervaded the lives and businesses of most people in the developed world in the past year, the world’s billionaires and millionaires have in fact got even richer. They now total 10 million individuals, who saw their overall wealth rocket 18.9% last year to $39 trillion — an almost ludicrously high figure, which flies in the face of the global recession.

While the relatively modest $1 million wealth bracket grew by 17%, the super rich (those with assets exceeding $30 million) did even better with their wealth increasing by 21.5%. This select financial elite had fortunes averaging $150 million each, which is particularly remarkable when you consider that the category begins at a ‘mere’ $30 million. For the average to be five times in excess of this, those at the top of the bracket must be very rich indeed.

This recent leap in the ultra rich’s collective wealth comes despite the fact that it was also the very rich who took the bigger hit in 2008, losing 245 of their fortunes. You need to be brave, it would seem, to play with the high-rollers.

The geographical distribution of the rich and very rich is also reflective of recent changes in global demographic structure. For the first time there were as many (three million) millionaires in Asia as there were in Europe, although Asia’s rich controlled $9.7 trillion at the end of 2009, compared with the $9.5 trillion held by their European counterparts. Japan had the second-largest group of millionaires, totalling 1.65 million, while Germany came in third, with 861,000. China came in fourth, with 477,000 millionaires, edging past Britain with 448,000. The millionaire’s sun is certainly rising in the East.

The ramifications for the luxury industry seem clear- there is profit to be made in a spectacular wealth category, which is increasingly separate from the rest of the world and apparently subject to their own economic mirco-climate. And while investment needs to be targeted geographically, it is perhaps emerging millionaire hubs that need to be targeted as much as whole emerging economies.

For wealth management companies the competition will be fierce but the rewards will also be enormous. But there are already signs that this trend is impacting at a fashion and retail level. LS recently spoke to a luxury jewellery designer who had been counter-intuitively advised by a senior industry expert to raise their prices, during this time of alleged penny pinching and luxury shame, in order to appeal to a demographic or consumer category that looked like it still had some growth in it — ‘the price insensitive’.

Rather than looking into cheaper diffusion lines, maybe luxury brands should be looking at stretching themselves to provide goods and services at the very top of the market. What could your brand do to appeal to the man or woman who has everything, and a fairly significant tranche of the world’s total wealth?

Sources
New York Times

Lucy Archibald
Lucy Archibald

Associate Editor

Related articles

CONSUMERS

5 Must Know Facts About China’s Millennials

CONSUMERS

Report: Decoding Luxury Marketing Milestones in China: Lunar New Year

CONSUMERS

In 2024, expect more of the same. Now is the time to optimise.