Spending on People
“A family is composed of children, men, women, an occasional animal, and the common cold.”
—OGDEN NASH
Orphans who live as hermits can reduce spending to a bare minimum if they choose. Affluent individuals tend to be the person in their families, in their circles of friends, in their various relationships most often picking up the tab. Certainly picking up the biggest tabs. It seems that the accomplished, affluent person is often standing in the center of a big circle of others, turning slowly in its center, handing money or support or gifts to each one each time he rotates past them. Because most affluent people are generous, many don’t mind. Even those who, from time to time, privately question this arrangement continue with it. This is particularly good news for those marketing to the affluent. Each affluent customer is a conduit to many other consumers. Each affluent consumer spends for a whole bunch of others, not just himself.
Here are a few such scenarios …
Money Spent on Kids and Grandkids
“You can get very hungry while waiting, if your livelihood depends on someone’s disease. Death does not always listen to the promises and prayers of those who would inherit.”
—MOLIERE
I recommend a visit to www.LilliputPlayHomes.com as instructive. The company advertises in publications read by the affluent, such as the Robb Report. In the issue on my bookshelf, their company’s quarter-page ad appears next to one from a law firm specializing in asset protection featuring a John D. Rockefeller quotation, and above a half-page ad for a mergers and acquisitions and commercial financing broker. On the facing page, ads for waterfront homes priced from $2.6 million to $11.9 million. Here, an ad for incredibly pricey backyard playhouses?
The perfect place.
Don’t leap to the conclusion there’s such a tiny market for such things that there can be only one odd company in the business. Check out www.SweetRetreatKids.com, offering themed backyard playhouses like the Beverly Hills Mansion, Fairytale Cottage, and Treasure Ship, priced from $995.00 all the way up to $53,900.00.
It is but one demonstration of thousands of demonstrations in my files and among my clients of this valuable fact: Many mass-affluent and affluent parents and grandparents set price entirely aside when buying things for their children and grandchildren. This is true for all sorts of reasons. Status and showing off. The opportunity to delight somebody, when all the adults in their family including their spouse are thoroughly jaded and very undelighted by the luxury lifestyle they enjoy. Guilt, over shorting the little ones on time or attention. Having been deprived as children themselves. The psychology is complex, but the reality is simple. In this case, you can sell a child’s playhouse for more money than a storage shed, garage, or room addition. Maybe more than the grandparents paid for their first real house.
It is also demonstration of another very important fact: Marketers of products for the lil’ ones are not limited to—and are, in fact, advised not to limit their advertising to—media specifically for parents, about parenting.
A friend of mine selling a very expensive children’s product who asked not to be named in this book said that his best clients are the guilt-ridden affluent parents, and he’d discovered the best place to find them is in magazines read by those flying private jets. He says the frequent business traveler, executive, or entrepreneur, with young children at home, in his second marriage to a younger woman; the very affluent couple leaving the kids at home with a nanny, baby-sitter, or grandparents while on luxury vacations; and the wealthy grandparent competitively vying for attention with other grandparents are, far and away, his best customers—and that the best time to catch their attention is when they are jetting across the country.
Money Spent on Women
“If women didn’t exist, all the money in the world would have no meaning.”
—ARISTOTLE ONASSIS
The man issuing the above quote would know. Once the richest man in the world, he “bought” John F. Kennedy’s widow, Jacqueline Kennedy.
The Brown Card, nicknamed “the ecstasy card,” was sold by Chocolat Michel Cluizel of Paris, actually located in New York, for $50,000.00. Cardholders enjoy limitless access to a private bar with fine wines paired with chocolates, exclusive tasting events, limited edition chocolates, and even a personal introduction to Cluizel himself, be still our beating hearts (www.cluizel.us).
Is there any sum some men will not spend to attempt impressing, delighting, or seducing women?
No, and many marketers grossly underestimate this sexually stimulated price elasticity. I am constantly dismayed at the unimaginativeness of gift certificate or gift card packaging and pricing by spas, hair salons, jewelers, resorts, stores, and others. Pay attention to Michel Cluizel. He’s selling a $50,000.00 gift card, but with a unique exclusive collection of products and privileges attached.
Shortly before one Christmas, a cosmetic surgeon appeared on ABC’s Good Morning America and explained how happy husbands were to purchase his Million Dollar Makeover gift certificates for their wives, unmarried significant others, mistresses, and girlfriends. Yes, they were paying $1 million for the ultimate gift for their honeys: a tune-up from tip of lip to toes and everything in between. It occurred to me that in some marriages, this gift might not be oohed and aahed over with as much enthusiasm as, say, a new car with diamonds in the glove box. Nevertheless, the enterprising doc said he was responding to men who were coming to him and asking for the ultimate package. His ordinary $100,000.00 Silver Package and $200,000.00 Gold Package just weren’t good enough. The patient on the show with him, an attractive mother of four, a recipient of the Million Dollar Makeover gift, was set to get an eye lift, facelift, neck lift, tummy tuck, butt lift, laser hair removal, enlarged lips, and, of course, breast augmentation. She still missed something; according to a report in The Wall Street Journal, hymenoplasty is the ultimate surgical gift—tightening of the vagina or even restoration of virginity, itself starting at only about $5,000.00. One ob-gyn advertises vaginal makeover packages for international patients that include airfare, limousine travel, and luxury hotel accommodations. Cosmetic surgery of all kinds has long ago emerged from hiding and become popularized by celebrities and more something to brag about than be quiet about. And there is a clientele for the million-dollar gift of it, raising as one question what ultimate package or ultimate gift should you sell in your business?
I can recall a time not that long ago when TV commercials aimed at men at Christmastime touted buying perfumes and jewelry. It’s a relatively recent phenomenon that, with perfectly straight face, many car companies run commercials suggesting surprising the wife with a new car. Dealers even furnish big red bows. “He went to Jared®” pales in comparison to “He went to Lexus®.” The ante is upped.
However, an excellent lesson in selling a gift of any kind comes from the mail-order jeweler Karats & Facets, which target markets to the mass-affluent. A page of outstanding sales copy from the company’s catalog appears on Page 170. It is headlined “Guaranteed Gasp or Your Money Refunded.” This company clearly understands it isn’t in the jewelry business but in the gasp business. Or, as the catalog puts it, assisting you with an “investment in your relationship.” In selling anything to men for women, this understanding should be yours as well.
Think you’ve seen it all at Victoria’s Secret®? Peruse La Perla® lingerie (www.laperla.com) for items like the Black Label bustier, priced into the hundreds of dollars. It’s salient that La Perla® lingerie is advertised in magazines published and provided only to people flying in private jets. Victoria’s Secret’s® advertising is conspicuously absent in these periodicals. I can give you my most confident personal assurance that few men know the difference between one bustier and another, but affluent men will buy what they perceive to be the prestige lingerie as a gift. And how will they know which is which? By where they see it advertised.
Guaranteed Gasp or Your Money Refunded
Here is jewelry to capture her heart.
Unique gemworks that make her feel unique. This is jewelry you won’t find in department stores (many are one-of-a-kind estate pieces). Nor will you spend hours shopping for them. Just make your choice(s). Dial 800-260-4987, ext. 500, on your phone, and a gift to make her gasp is on its way.
You expect only the finest quality when you purchase Karats & Facets jewelry, and you surely get it. We choose our gems for their immaculate cut and clarity. We use only solid, high-karat gold for our gem settings. Bracelet links are pin-hinged for super flex-strength. And we add not one but two locking clasps to make them vault-safe.
Karats & Facets jewelry is more than an investment in your relationship. Its intrinsic value is one that sustains with the years.
Yet we offer these beautiful pieces at amazing values, unmatched elsewhere. How can we? We buy our gems directly from abroad, eliminating agent and middlemen costs. We smith our own gold in our own workshops (you’re welcome to visit anytime). Then we market our jewelry directly to you to avoid distributor, broker, and retail markups.
Finally, there’s our airtight satisfaction guarantee: If you’re not 100% satisfied, you have 30 days to return it for a full refund.
Money Spent on Pets (Pets Are People, Too!)
“The Don CeSar hotel is overly pet friendly. Ridiculously pet friendly. They have a pet concierge that comes to your room and describes the services they offer your pet … They said they had aromatherapy for dogs. I’m like, ‘Do you have a candle that smells like another dog’s ass?’ That’s what he likes.”
—COMEDIAN RON WHITE, CHARTER MEMBER OF THE BLUE COLLAR COMEDY TOUR (WWW.TATERSALAD.COM)
You might want to come back as a dog in an affluent home in your next life. Their future looks bright.
Designers have discovered pets, so, for example you can bug a Gucci® dog bowl for $900.00. At www.PostModernPets.com, affluent owners can buy an Italian-designed doghouse or a Cabitat cat condo, a leather dog bed ($1,450.00), or a Jonathan Adler designer dog dish. One of the humans behind this website says it is “for people who are serious about incorporating their pets fully into their lifestyle.”
There is a fast-growing population of such people. In his 2007 book MicroTrends, author and political pollster Mark Penn called them “pet parents.” That term has since become common lexicon. Penn wrote, incidentally, about “little things” that drive big trends, and he was right about this one. The “humanization” of pets caught on in a very big way.
My wife and I are admittedly among them. The little dog who lives with us is considered when we choose hotels and resorts to visit—with rare exception, they must be pet friendly. Preferably very friendly. We prefer her with us rather than left behind, so shopping center, store, and similar choices are also made based on whether or not she is welcome. She has her own little couch, her own fur throw, her own blanket. She commutes between our two homes with one or both of us uncaged relaxed in the private plane, which she greatly prefers to traveling with the peon pets on commercial airlines, where she must be stuffed in a small cage that fits under the seat. And yes, she knows the difference between driving toward the regular airline terminal and turning off to the private terminal. She is spoiled. I call her our Million-Dollar Dog. And our Million-Dollar Dog has a bone to pick with you, if you aren’t accommodating her as one of the family.
In one city you’ll find a Starbucks®-like, upscale coffeehouse for humans under the same roof as the Whole Pet Café, serving healthy meat, vegetable, and whole-grain meals and designer waters to dogs, at $4.00 to $10.00 per item. Next door, a fancy veterinary clinic and a high-end pet fashions and accessories store. In another city, a pet day spa featuring not just grooming and nail clipping, but fur-beautifying blueberry facials, massages, saunas. Classical music is played exclusively in the fur stylist’s salon. Another city boasts a pet hotel with private suites, complete with comfortable beds, heated floors, and plasma TVs. None of these businesses is in Beverly Hills or Manhattan, although businesses just like them are there, as you’d expect. The ones I just described are in Dallas, Texas; Long Beach, California; and Charlotte, North Carolina. In Alexandria, Virginia, near one of my homes, the entire community of Main Street merchants wisely caters to pets and their owners. A local hotel has a happy hour for dogs. The baker features birthday cakes for pets. There is a dog apparel store.
Pets are the new children and grandchildren. Boomers’ kids are grown and gone. Families once staying in close geographic proximity are now spread out to different and distant locations. Spoiling grandchildren is made more difficult by this separation. So affluents, especially affluent Boomers, dote on their dogs, cats, and other pets. And spend truly astounding sums doing so.
No affluent pet owner does the math. The gourmet dog food he purchases in little containers costs more per pound than the steaks he eats himself. The Burberry® dog coat at $200.00 costs more per square inch of plaid than his own Burberry® overcoat. It does not matter.
Pet products are now one of the top ten U.S. retail segments—a bigger industry than toys or candy or hardware. Currently, more than $69 billion is spent each year on pets, double the amount spent just ten years ago. This staggering number may again double within the next ten years. 68% of American households have pets, up from 50% roughly 30 years ago, and an all-time high. That’s 25% higher than the percentage of households with children. In the past 30 years, the drop in households with kids mirrors the rise in households with pets. As baby Boomers become empty nesters, household spending on children is declining while spending on pets is rising. Over a three-year term, spending on toys, games, tricycles, and children’s clothes fell by more than 20%; spending on pets rose by 23%.
The fastest growth segment: luxury pet products bought by affluent pet owners. About 40% of all the dollars spent buying things for pets deliver them to only 1% of the pets, the most pampered of the pampered pooches and kitties. Louis Vuitton®, Chanel®, and Burberry® sell designer dog collars, leashes, and toys; Gucci®, Tiffany®, Coach®, L.L. Bean®, and Harley-Davidson® are all in the luxury dog accessories business.
The love of dogs drove the book A Dog’s Purpose to the top of the New York Times bestseller list—a lofty place this book will never see—and kept it there. If you haven’t read it, and you like dogs, you must.
Wealthy dog owners can now spoil their furry best friends with designer dog houses modeled on Imperial Roman manors and Colonial American Mansions … with fancy marble columns, beech wood floors, classic porticos, even miniature chandeliers … coupled with all modern conveniences: central heat and air conditioning, motion activated lighting, and automated treat dispensers. Gives “being in the dog house” new meaning. Most are also equipped with internet-based communication systems so owners can see and speak to their dogs anytime. From a British firm, Hecate Verona. Price around $215,000.00. Not a typo. Two hundred and fifteen thousand dollars.