January 10, 2008

Greetings to the New Year!

I'd like to share more information from the Harrison Group's presentation to the Recreational Development Councils at the Urban Land Institute October meeting. In my November bog I mentioned some of the material, but over the past two months I've though more and more about the data.

Source: Harrison Group for American Express Publishing

The concept that I had not thought much about was 'discretionary income' vs. household income. Sorry if I'm behind the curve on this. I know we are in the discretionary product market with vacation homes - that's clear , but, I had always thought of the 'household' part, NOT the part they had to spend of the household income. I guess assuming if the income was high enough they would buy.

Here' s how Harrison delineates wealth categories:

Affluent = annual, discretionary income of $125,000 to $249,999
Super Affluent = annual discretionary income of $250,000 to $499,000
Wealthy = annual discretionary income of $500,000+

Here's how the vacation ownership break down:

Own 2nd Home

Affluent 32%
Super Affluent 34%
Wealthy 49%

Own Timeshare
Affluent 20%
Super Affluent 15%
Wealthy 14%

Own Fraction
Affluent 15%
Super Affluent 12%
Wealthy 13%

Their Intention to buy:
Buy a Second Home
Affluent 21%
Super Affluent 28%
Wealthy 37%
Buy a Timeshare
Affluent 15%
Super Affluent 19%
Wealthy 11%


Buy a Fraction
Affluent 15%
Super Affluent 23%
Wealthy 14%

Wow, wow and wow on the 23% of the Super Affluent!

As we design the physical fractional home here's how these groups look at and how they play out with brands. We kind of know to use quality stuff, but….

Quality - 97% want quality and the reputation of quality
Craftsmanship - 96% want to have their property be reflective of this
Design - 81% go for who has a reputation for this




All you marketing folk read up here: What the wealthy are collecting?
Fine art 20%
Sound systems/media 18 %
Books/Rare books 18%
Fine Watches 18%
Yachts/Boat 17%
Vintage cars 14%

Great stuff, no? Gimme those Super Affluents almost a quarter of which want to buy a fraction!

Best to all.