The search for social currency

Updated: Jul 21 2014, 02:57am hrs
Here's an insight into the rich and what they spend their money on. The Futures Laboratory, a London-based think tank, says in a report that the way people spend money changes the longer they have it. That may not be such a surprise, but theres a method to the analysis. Luxury consumption, according to the report, involves five stages. The neo-rich, for instance, will spend money to demonstrate wealth and define their social position, and they do this by purchases of status-giving brands. The second stage is where they switch from popular brands to ones that convey discernment and higher levels of taste. Stage three is of experience and knowledge, where consumers are concerned with unique experiences that set them apart from the herd. Stage four is concerned with responsibility and awareness, where purchase of a particular product depends on the image of the brand and its CSR, or corporate social responsibility, quotient. The final stage is where theres less consumerism and a greater sense of spirituality and charitable acts. A more detailed analysis by WealthX and Singapores Wealth magazine found that most of the ultra-rich in western countries are between stages two and three, while in Asia, most of the wealthy class, not the newly rich but those born into wealth, are between stages two and three. They have bought the Merc or the BMW, the Zegna suits, the Dior dress and the Gucci handbags, but to differentiate themselves from the new rich, they have reached a stage where material goods are no longer enough. They are looking for the next level, or what is being called social currency, namely, the experiences that will set them apart from their peers. In rich speak, this is what is referred to as experiential luxury.

The research finds that a number of travel and concierge companies are catering to the growing number of third-stage wealthy Asian travellers who are looking for one-off experiences that set them apart from the rest. It could be that adventure cruise to Antarctica, a hot-air balloon ride over the Serengeti, or a VIP seat at a prestigious sporting event. In India, a number of concierge services are growing, both local and global, offering special services and unique experiences, tailor-made for their interests and the time factor. Quintessentially Lifestyle, one of the bigger concierge companies, reports that travelling has become an increasingly bespoke experience amongst Asias wealthy. Of late, they have found that no travel itinerary they are given by rich clients is the same as another. Members are going beyond wanting to be a spectator, but getting deeply involved whether it be a spiritual experience in India, or training for a special event, or giving more time to a passion project.

Others agree that authenticity is the key when it comes to luxury travel. Khiri Travel is an Asia-based travel agency specialising in unique experiences. The company sees an increasing demand for authentic travel experiences from Singapore, Hong Kong, Beijing, Shanghai and other Asian cities. Asian wealth centres are growing more sophisticated in travel demands, as per the agency. They organise itineraries which include a trip to Myanmar to visit off-the-beaten-track villages, educational tours in historical areas of Thailand or local cooking classes on a remote island resort, or a visit to the tented camp in a remote area in western Cambodia to learn about the traditional lifestyle of the locals.

According to the report in Business Times of Singapores Wealth magazine, for those who still relish their comfort and luxury, there are companies like MVIP. It arranges for groups or individuals to get into major live sports events with a VIP packagefor example, box seats at Wimbledon during the Championship. In fact, the Wealth-X Luxury Sentiment Survey supports this trend. The survey showed that senior executives in the luxury industry found that 90% of respondents said that experiential marketinglike taking clients to sports games or charity auctionsis now crucial to their brands growth. Others in the segment agree that they are seeing a growing number of Asian consumers who no longer want to go to Italy to get fitted for bespoke suits. They now want a combination of amazing landscape, wildlife and conservation. And the next frontier, for rich Asian travellers, is space. Already, a surprising number of Indians have signed up for a seat on the commercial space flights that are due to take off by next year. Thats one experience to be one-up on your peers.