Like a will-o-the-wisp, the most affluent of society can be elusive. Though a complicated customer to reach for the retailer, they remain one of the most active buyers:
“The most affluent 20% are responsible for a third of consumer spending.”
NatWest Business Retail and Leisure Outlook Report 2024
How do you connect with this customer who desires exclusivity and bespoke experiences? Mass marketing tactics often fall short, and the marketer must adopt niche strategies to reach them. Surely there’s an easier way?
If you are a luxury home furnishing retailer, you have probably explored targeting interior designers and architects, as well as magazines and trade publications. You are working hard on referrals and sponsorships and attending the right networking events. All of this is great, but there is a better alternative. An additional layer of targeting that the luxury retailer tends to overlook, or is simply blind to, is residential property market data - especially homemover activity. Homemovers are big spenders and a prime audience for retailers. This is the avenue you should pursue if you want to reach elusive high-net-worth individuals (HNWI).
What if you could have a crystal ball predicting who and when to target as they are putting their house on sale, or moving to a new one? More on this later…
According to Knight Frank’s flagship Wealth Report, there has been a rise in the number of Ultra-High-Net-Worth Individuals and around a fifth of these are investing in residential property this year.
Our data shows that the supply of properties priced at £1m+ entering the market reached its highest point in five years earlier this year.
In July, there were 6,255 homes listed for sale in the £1m to 2m price band, 554 properties in the £3 to £5m bracket and over 300 properties worth over £5m.
Naturally, the highest volume of luxury homes for sale is in Inner London and the South-East, with a growing number of expensive properties sold in the East of England:
According to Knight Frank’s Wealth Report, 22% of Ultra-High-Net-Worth Individuals and 19% of High-Net-Worth Individuals plan to buy a home in 2024.
What does this all mean for luxury home furnishing retailers?
While the furniture market faced some challenges in 2022 and 2023, the majority of market analysts believe that the long-term outlook remains positive. The continued demand for comfortable and functional living spaces, coupled with the potential growth in the millennial demographic (see the graph below), presents a promising opportunity for furniture retailers who can adapt to changing consumer preferences and offer high-quality products at competitive prices.
The homemover is a lucrative customer, proven to spend more than a non-mover. At TwentyCi, we track 99.6% of all activities on the property market, advising retailers of the best time to target households, as soon as a property is being put on the market for sale. With one of our large national furniture retailers, we found that the typical homemover spent nearly 56% more than a non-mover. The same principle applies to HNWI.
We connect retailers with HNWI, but we can specifically target those moving home who will likely be in the market for new furniture. We know exactly what point each homemover is in the journey, whether that’s at the For Sale stage, Sold Subject to Contract or Moved In.
We even have a Likely-To-Instruct model so we can discover who these customers are likely to be before they even put their home up for sale – with a 50% accuracy rate!
We track the property market connecting retailers with owners of properties on the higher end of the spectrum. We also provide marketing services targeted at those homeowners with properties over £500,000, £750,000, £1 million… whatever value you feel is relevant for your brand. We can drill down further still with our DOMUS database.
We have access to over 350 property attributes, everything from whether a property has a garage to the oldest resident in the home. For luxury retailers, we usually target specific postcodes and go after the most expensive locations to live. We can filter down to only those properties that have four or more floors or more than four bedrooms, or target properties that have gyms, cinemas or stables and those with gated drives or private roads. Some other interesting luxury property attributes include tennis courts, helicopter pads, hangars, swimming pools or even lakes.
One of these features may even be relevant to a retailer’s product offering or target audience. For example, a luxury kitchen retailer may wish to only target those with a kitchen island or only kitchens over a certain size (another two of our DOMUS attributes.) For luxury furniture retailers, our ‘wide doorway’ attribute may be a relevant target, if your products are non-modular and cannot be disassembled and rebuilt. That’s how granular we can go with our data!
Now that you know we have access to the owners of the highest property prices, how do we reach them? Many of our successful campaigns use direct mail at the forefront. Direct mail has a timeless appeal. As luxury brands need to offer something exclusive, direct mail is ideal because it appeals to the senses, thanks to its tangibility. A well-executed creative mail piece that resonates with your audience, can be a powerful differentiator. It leaves a memorable experience. According to Furniture News, 11% of shoppers discovered new furniture through direct mail advertising so it’s a worthy marketing tool to have in your arsenal.
The physical presence of direct mail commands attention and it typically has a longer lifespan, remaining in the home. This repeat exposure to the brand leads to better brand recall. Digital advertising is saturated, so to the customer, receiving an expertly crafted piece of direct mail can signal a sense of exclusivity and it shows that you value them. This lasting presence allows you to build long-term relationships with prospective clients, especially if they are private and not willing to share their email addresses. You can personalise your physical mail by referencing products that align with their lifestyle to show that you’ve taken the time to understand their preferences. You can also tap into that need for exclusivity by offering VIP invitations or exclusive offers. Unveil your limited-edition items or tailor-made collections to captivate this sophisticated audience.
Direct mail is ideal as you can track the effectiveness via the use of QR codes, unique URLs or dedicated phone numbers. Use direct mail to highlight the quality, craftsmanship, and exclusivity of your products to appeal to your target customers. When you target high-net-worth individuals, high-quality paper and an eye-catching, prestigious design that exudes luxury will resound with affluent customers.
We can connect you to those who own the most expensive properties on the market so you can reach prospective customers without the need for costly magazine adverts or pricey VIP events. Intrigued? You should be! Give us a call to discuss what we can do for your brand.