(number of millionaires by country)
Digital marketing that targets high-net-worth-individuals and ultra-high-net-worth-individuals is a fairly niche area of expertise, with few digital agencies specialising in the luxury sector, and luxury brands having been generally slower to implement and reap the benefits of online marketing.
WHY IS DIGITAL MARKETING TO HIGH-NET-WORTH-INDIVIDUALS SO NICHE?
There is sometimes a misconception among luxury brands and marketers that digital marketing is somehow incompatible with the luxury industry. People believe that HNWIs do not engage in social media, do not make online purchases etc., or that if they do it is only through super exclusive social media sites or at private members clubs.
This is absolutely not the case.
There is plenty of data around which contradicts the perception that HNWIs don’t engage in the digital world. For example, a study conducted by PwC found that 98% of HNWIs access the internet daily and that the world’s wealthiest now expect online and digital functionality in many aspects of their lives.
Using digital marketing strategies for high-net-worth-individuals is niche in that the luxury sector is aimed at a smaller number of consumers, and on top of that a large portion of businesses in this sector are not using digital to its full potential.
Digital marketing actually provides better value for money than traditional marketing methods, since ROI is a lot easier to track with digital advertising. This means it can be a great way for new luxury brands to get the word out without incurring huge expenses.
Even if it is very tricky to provide ROI on the purchase and sale of high value goods (non-ecommerce), it is possible through CRM & Marketing Automation. ROI from a magazine advert or an airport banner is not so easy to prove – there are too many moving parts.
WHAT HAPPENS WHEN DIGITAL MARKETING STRATEGIES FOR HIGH-NET-WORTH-INDIVIDUALS ARE IGNORED BY LUXURY BRANDS?
The great thing about the digital world is that it is democratic – it means that any company regardless of size can target any internet user, including HNWIs. This means there is essentially an open market for boutique luxury brands to disrupt the industry by competing with more well-established brands and targeting HNWIs directly; that is a pretty persuasive thought.
In terms of how to target high-net-worth-individuals, internet searches and brand recognition through social media are both key factors in the decision-making process for consumers, and this is true of HNWI consumers as well.
So, the failure of luxury brands to acknowledge digital marketing to high-net-worth-individuals as a great method of increasing revenue means that brands who are ahead of the game and engage in digital marketing strategies can achieve huge amounts of success.
A great example of this is Gucci, which in 2015 was headed by a new CEO and a new Creative Director, Marco Bizzarri and Alessandro Michele. The pair were credited with delivering Gucci’s parent company Kering its strongest year-on-year revenue increase since 2012 in 2016, and this was partly thanks to how the brand re-engaged with its online audience and fans.
Michele worked on innovative digital projects to connect with a new customer base, such as #TFWGUCCI (That Feeling When Gucci). For this social campaign, Gucci commissioned international artists curated by Michele to develop original imagery for the campaign. The images were then given to a new class of viral creators and influencers to turn into new memes. The result is a curated collection of captioned art designed to help viewers express themselves online.
Adapted from a popular meme, That Feeling When Gucci is about the moment of putting on one of the watches and it changing your day for the better. Asking influencers to re-interpret the brand’s design aesthetic was a bold step for Gucci, but it was keenly rewarded, inviting their audience to think about the brand in a new way and creating shareable content that would be seen by many new eyes.
HOW DO HNWIS USE THE INTERNET?
Pretty much the same way most people do – a lot. Affluent consumers typically have multiple digital devices and are likely to use them for five or more hours a day, making extensive use of smartphone apps.
In fact, given that wealth is obviously a large factor in how accessible new technologies are to a person, HNWIs are more likely to be adept at using technology and the latest technology. An Accenture Consulting survey of wealthy investors found that more than 41% consider themselves early adopters in technology.
So, in all likelihood, HNWIs are probably more skilled and experienced at using the internet than the average consumer.
There is also evidence to show that the affluent market has double the smartphone penetration of the general population and therefore likely uses mobile search even more than other audiences, which makes sense when considering how much they are likely to travel or to be completing search queries while on-the-go. So, it’s definitely worth ensuring your website is properly configured for mobile users, or you may find potential customers visiting your site will immediately leave to find one with a better mobile user experience.
SO, HOW CAN LUXURY BRANDS TARGET HNWI’S ONLINE?
There are a variety of digital marketing strategies for high-net-worth-individuals which can work well for luxury brands – of course, the strategy depends on their goals. Making sure your digital marketing team or external agency are fully aware of your aims and budget, and will work to secure the highest ROI possible.
Different methods include search engine optimisation to ensure that your website is visible when HNWIs are entering search terms into Google relating to your product or service. You can then build on this through digital advertising and working on your organic traffic to make sure your website is at the top of the search results.
Blogging and social media are a great way to build brand awareness – creating a digital voice and a story for your brand, in the same way that Gucci did, is an excellent method for engaging customers and increasing your customer base.
PR and digital PR can also be ideal for targeting a niche group like high-net-worth clients by making sure editorial pieces promoting your product or service can be found in publications with an affluent readership.
Other ideas include: (get your notepad!)
- Geo-targeting cities/regions where the most wealthy people in the world live or spend time.
- Make your organic keywords more location and season specific.
- Target family offices and legal firms.
- Target niche groups of people using LinkedIn and Facebook.
- Create specialised SEO landing pages targeting very particular HNW searches.
- Retarget people who have spent quality time on your website with beautifully designed adverts.
- Social media advertising to all people in tax-favourable locations.
- Collect information about your customers using specialised CRM properties for ongoing retargeting.
- Use display advertising to show banner ads to people searching for ‘luxury’ goods and visiting HNWI publications.
- Use advertising to appear when customers type in your competitors’ names or search for expensive specialist goods.
- Target new people based on interests with high conversion rates on your site, refining by placement site, content topics, and display keywords.
- Create stunning content.
- Target tomorrow’s millionaires … “son of / daughter of ” on Instagram.
- Target people on the latest expensive devices.
- Target people wanting to do extraordinary things that require budget.
The main advice on digital marketing for high-net-worth-individuals is to make sure your brand’s online content is relevant and informative, and therefore useful to your target audience. Many companies in the luxury sector, particularly financial ones, use informational content to become a voice of authority in their sector – this helps build brand trust and recognition.
HOW TO TARGET HNWI USING SEO
WHICH KEYWORDS DO LUXURY CONSUMERS USE WHEN SEARCHING ON THE INTERNET?
You should target the keywords which describe your product and ensure that your site is well-optimised for these keywords.
It’s worth noting that sticking ‘luxury’ or ‘expensive’ at the start of your keyword won’t necessarily restrict your product to being viewed by HNWIs or UHNWs. This is because people searching for these terms might be people simply curious about or aspiring to certain products, or may possibly be my university students looking for case studies! In my experience, I’ve found HNWIs don’t often use such terms and the conversion rate for terms may well be much lower. It is unlikely that wealthy individuals would think of many items as ‘luxury’ if they are able to afford their choice of anything in the world.
Here’s a small experiment we ran through AdWords Keyword Planning Tool to see the monthly search volume for products like watches, cars, and real estate.
Evidently, there’s nothing to be gained from targeting ‘expensive’ uniquely – cost doesn’t come into the search terms. Likewise, while using ‘luxury’ might get you a more niche audience, we have often found this to have a much lower conversion rate. Of course, the product terms themselves have the highest search volumes but are far too generic to compete with in terms of SEO.
So, you need to really consider specifically what kind of person would be searching for your product or service and how you can use the right keywords to address the search terms they commonly use. Of course, ultra-high-net-worth-individuals may well have someone doing their groundwork, such as a PA or wealth manager, so you will need to tap into the way these people would think too. HNWIs are often searching for something specific, so long-tail keywords are a good place to focus your strategy – you will want to create specialised landing pages on your website to target very particular searches, featuring amenities or trips that only HNWIs might be interested in or that require a lot of budget.
You could also consider making your website multilingual and optimising for keywords in a range of languages, to target the many non-english speaking HNWIs around the world. Another crucial thing from an SEO perspective is also for a brand to have local authority in the digital space. This may not apply as much to cars, watches etc, but it certainly does for things like helicopter charter, real estate, private yacht charter, restaurants and bars, where people typically want to find something that is close to them. This will mean that your keywords may need to be more geography and season specific, depending on your business.
HOW TO TARGET HNWI WITH PPC
HOW CAN YOU CREATE EFFECTIVE TARGETED PPC CAMPAIGNS IN GOOGLE ADS?
One of the most useful digital marketing strategies for targeting high-net-worth-individuals is adapting the metrics of your PPC campaign to target people in a specific area, possibly local to your business, and layering in household income factors. Google collects data based on users’ interactions online and the websites they visit to determine their income level, which is split into a tiered system.
This means, for example, that if you own a luxury car dealership in Mayfair, you can run a PPC Campaign to target high-earning individuals, with an interest in cars, who live in the vicinity of your business, and are within an age range that is likely to buy an expensive car. You can also use demographic targeting to avoid showing your ads to people not likely to buy your products, meaning a higher ROI on your PPC ads.
Of course, this strategy can be expanded to reach all the wealthiest cities and most tax-favourable countries in the world, depending on your audience. Luxury travel hubs – for example private airports, country clubs, exotic golf courses and five-star hotels – are targeting gold, as these are places with a very high concentration of HNWIs. You can also set up advertising targeted at people attending high-end events, such as polo, the F1 or yacht shows, to reach HNWIs with different interests. If you have a competitor or competitors who you need to shake, you can even use Google Ads to appear at the top when people type in their brand names, although we would also err on the side of caution here.
Search advertising is a very effective choice because it targets people who are already looking for something and have “search intent”. They may type in particular search terms which an advertiser will target with a set of keywords in order for their ad to show and entice the user into visiting their website.
The Google Display Network also works well for luxury because often the buyer will not purchase these high-value items straight away. Display adverts using targeted audiences, showing images of luxury products that a user may be considering buying, are often enticing and will attract attention. Creating beautiful ads is a key part of this.
Display ads mean that your audience will be reminded of a product again and again as they move around the web, often prompting an earlier-than-intended purchase. With a variety of targeting options, ranging from specific sites of your choosing to website placements based on audience characteristics, there are many ways to reach HNWIs. For example, you could target your banner ads at people visiting online publications commonly read by the world’s wealthiest. You can then use specialised CRM properties to analyse your website visitors for ongoing retargeting.
To really zero in on your specific audience, you could also target people based on interest categories with high conversion rates on your website, refining by placement site, content topics, and display keywords (both content and interest-based). This could mean targeting people interested in futures trading on luxury lifestyle sites or people into skiing holidays on news/finance sites. If your focus is bringing traffic in-store, try using location targeting that presents a display ad on a user’s phone when they pass your shop or yacht berth (if you are exhibiting at a yacht show), tempting them in.
HOW TO TARGET HNWI USING SOCIAL MEDIA
DO HIGH-NET-WORTH-INDIVIDUALS USE SOCIAL MEDIA?
Absolutely! A survey by Spectrem Group found that 70% of millionaires use at least one social networking platform, with 55% reporting to be on Facebook. This means there is a large portion of luxury brands’ target audience ready to be fed information, which will influence their decision-making process when it comes to making purchases.
We shouldn’t underestimate the role social media can have for building brand awareness and communicating with HNWIs. In the financial services industry, the use of social media to communicate with customers has allowed major improvements in efficiency over the last two decades.
Provided you have a good social media manager, social can be a very effective method of digital marketing to high-net-worth-individuals who are specifically interested in the products or services you are offering.
LinkedIn found that two-thirds of HNWIs visited LinkedIn monthly and used the platform as a resource for investment research, seeing LinkedIn as a critical tool for building business relationships. What’s more, we see many multi-millionaires and billionaires frequently interacting on the platform, from Bill Gates who writes and shares thought-provoking articles to Diana Arama, CEO & Founder private members club MAYFAIR Privè, who engages through comments and posts.
Social media allows wealth managers, for example, to provide real-time recommendations and updates based on their customers’ behaviours. So, finance companies, in particular, should be seriously considering the massive opportunity of using social channels to provide investment strategies for high-net-worth-individuals and prove themselves experts in their industry.
WHICH IS THE BEST SOCIAL NETWORK FOR TARGETING HNWI AND PROMOTING LUXURY BRANDS?
Different social networks obviously have different uses and so tend to attract different users. For example, plenty of HNWIs are very engaged on LinkedIn because it is a tool designed for making business connections.
There are, of course, several social networks used exclusively by the rich, such as Best of All Worlds (BOAW), an invite-only app which is like a cross between Facebook and LinkedIn and aimed at the elite, and Rich Kids, an Instagram-alike app to which membership costs €1,000 per month. But, companies targeting affluent individuals can still make the most of other social sites through high-quality, targeted content.
To seek out UHNWIs on social media, layered targeting is highly important and enables you to reach only the exclusive groups you wish to receive your advertising. Facebook and LinkedIn can be highly targeted, making them ideal for reaching this HNW audience.
Facebook geo-targeting allows you to target highly specific locations, as narrow as individual postcodes, as well as to pin drop locations of 1km2, allowing you to focus your advertising efforts on only the locations with residential property values of £1million+. LinkedIn targeting is extremely comprehensive to the point where you can target individual companies, specific job titles and member skills; however, you do need a minimum audience size – you are unable to target individual people in one campaign. On LinkedIn, there are also Family Office groups and exclusive members’ clubs, which contain some of the world’s wealthiest investors and so are perfect for targeting.
Many of tomorrow’s millionaires – the “son of / daughter of”- are on Instagram and by targeting these new up-and-coming influencers you can lock in brand loyalty at an early age. What’s more, these luxury global consumers are highly influential on Instagram, with almost twice as many followers than the average global Instagrammer. They typically use the platform seven days a week, compared to the six days a week of the average global consumer, and like three times more content than the average global Instagrammer.
Instagram ads are particularly valuable for luxury brands, as they allow you to present a high-quality, aspirational video of your product. However, creating and sharing beautiful content is important across all channels if you want to present yourself as a premium brand.
With a clear understanding of digital marketing strategies for high-net-worth-individuals through social media and how to create effective social advertising campaigns, luxury brands can find many social networks a surprisingly powerful and cost-effective tool.
WHICH OTHER FACTORS SHOULD BE TAKEN INTO ACCOUNT WHEN TARGETING HNWIS THROUGH SOCIAL MEDIA?
It’s impossible to really target HNWIs as a whole group without forgetting the I – the individual.
When targeting a niche but relatively large group of consumers engaged in social media, you should consider whether your strategy caters for different languages and cultural backgrounds, genders, locations and ages. This is where the social advertising I mentioned before can come in handy as it allows you to attune your target audience to several specific parameters.
In terms of age, millennial investors in particular expect real-time contact with people in their business and professional networks. However, Baby Boomers, Gen X and Millennial investors actively engage in social media – 14% of Boomers, 32% of Genx X and 30% of Millennials engage with brands at least monthly – so luxury brands and financial companies should be using social to build their brand and become voices of authority in their sector respectively. A good way to capture the attention of an audience and show your brand’s personality is by posting not just about your company, but about other related topics that your audience are typically interested in. For HNWIs this could be wealth management, philanthropy or luxury travel, to name a few.
The most important thing to consider when orchestrating digital marketing for high-net-worth-individuals through a social media platform is that you should not be just promoting your product or service – social should be used as a tool for building relationships with your target audience. A good guidance for this is the 80-20 rule – this advises that your content should be just 20% sales and 80% entertainment and extra value content.
The methods for marketing to UHNWIs are constantly developing and adapting, and as business owners or marketing professionals, we must keep up to ensure that our brands stay relevant and desired by the world’s wealthiest. Contact the Omega project for more information on targeting HNWIs or UHNWIs from our digital marketing agency.