Rodeo Drive, Los Angeles, California


A recent article by The Moscow Times reported that “spending by Russian tourists abroad has plunged, diving 51 percent in January after falling 44 percent in December because of the ruble’s freefall.” The report cited figures released by tax-refund company Global Blue.

On its website, the news outlet noted luxury marketers are battling “crippled demand from Russians for luxury goods, and many labels are growing concerned the trend could last, with no end in sight for the conflict in Ukraine.”

Among those brands reportedly impacted “Salvatore Ferragamo, have been severely hit by the Russian economic crisis…Last week, Jean-Francois Palus, No.2 at Gucci owner Kering, said the group’s Italian tailor Brioni had witnessed a significant drop in sales to Russian tourists.”


 Spending by Russian tourists abroad has plunged, diving 51% in January 


The Russian traveler is an important marketing, particularly for shopping while traveling. “The Russian luxury market is made by relatively few consumers with very high discretionary spending power, as epitomized by the ‘Russian oligarch’,” said Luca Solca, a luxury goods analyst at Exane BNP Paribas.

“These consumers have higher exposure to high-end versus accessible luxury brands and categories … such as Brioni and Cartier.” So where can luxury marketers find well-to-do Ultra High Net Worth customers?

Slicing apart data from the 2014 World Ultra Wealth Report reveals if American states were viewed as countries, 23 of the top 50 Super Rich populations would be states. The report defines Super Rich/UHNW as $30 million + in assets.

Ranked alongside countries, California would be third in the world, New York sixth, Texas ninth and Florida 12th. Illinois (17th), Michigan (19th), Pennsylvania (21st), Ohio (23rd), Massachusetts (27th), Wisconsin (28th), Connecticut (31st), Maryland (32nd), Virginia (34th), Minnesota (35th), New Jersey (36th) and Washington (39th).


 Ranked alongside countries, California holds the third largest population of UHNW in the world 


North Carolina (41st), Georgia (43rd), Tennessee (44th), Colorado (45th), Indiana (47th), Arizona (48th) and Oklahoma (49th) show that for marketers there are significant pockets of the Super Rich in the so-called “fly over” states. Now all they have to do is look beyond hotspots like New York City, Dallas and Los Angeles,

In terms of UHNW consumers, Russia would have ranked only 40th fit snuggly between the state of Washington and North Carolina and well behind the likes of Wisconsin, Maryland and Minnesota.

Wealth-X defines Super Rich as households with a net worth of at least $30 million and says combined this group spends $234 billion on luxury lifestyle products and services.



The Rich Kids of Instagram


Where do the world’s ultra-wealthy live, travel and send their children to be educated? Here we reveal the key insights from Knight Frank’s 2015 Wealth Report


The Rich Keep Getting Richer

Despite economic headwinds, Ultra High Net Worth wealth continues to rise. Knight Frank estimates that there are 172,850 UHNW individuals globally, representing a 3% increase in the number from 2013 to 2014.

Over the same period, according to wealth advisors, 82% of UHNWI’s surveyed had increased their wealth during 2014, with only 3% reporting a fall. 80% of survey respondents expect their clients’ wealth to grow further in 2015.



They Added $700bn To Their Wealth in 2014

The global population of ultra-high-net- worth individuals grew by almost 5,200 last year, according to WealthInsight. This latest increase means 65,335 people have joined the ranks of the ultra-wealthy over the past decade – a rise of 61%.

In total, there are now 172,850 individuals in this cohort who hold wealth totaling $20.8tn, an increase of $700bn during 2014. Nearly 1,180 people became centa-millionaires in 2014, taking the world’s total population of those worth over $100m to 38,280.



America is the Land of Opportunity

44,922 UHNW individuals live in North America alone, compared with 60,565 in the whole of Europe. In terms of sheer numbers, the US will still be the dominant force in terms of its ultra-wealthy population in 2024, with the data forecasting a 25% increase in UHNWI numbers to almost 51,000, the biggest concentration in any single country.

Focusing on the most important cities to UHNWI’s, there were six cities in the United States that ranked within the Top 40; New York City (#3), Miami (#6), San Francisco (#19), Los Angeles (#22), Washington DC (#34) and Boston (#35).


 Six cities in the U.S. ranked in the Top 40 most important cities to UHNWI’s 


London Up, Europe Down

Focusing purely on the population of wealthy residents, the report confirms that London remains the single biggest centre for global UHNWIs, followed by Tokyo, Singapore and New York. With the exception of London, European cities will see a relative decline in their rankings based on the size of their UHNWI populations over the next decade.



Don’t Be Seduced by Zambia

The UHNW population of Monaco increased by the highest rate (10%) in 2014, followed by Zambia, Mongolia, Namibia and Kazakhstan. Which is all well and good until you consider that just 16 UHNW individuals currently live in Zambia, 48 in Mongolia, 17 in Namibia and 190 in Kazakhstan.

It’s easy to report higher percentage increases in population when you are starting from a small base. But think about whether or not the presence of sixteen UHNW individuals in one African Republic is enough to justify your entry into this country as a brand. Or whether or not it will be more profitable to target this wealthy individual during his frequent travels abroad.



Don’ Be Seduced by Nationality

Consider all the activity of luxury brands opening brick-and-mortar stores in markets such as China, Russia and Brazil, thought to have large – increasing – numbers of UHNWI’s.

Imagine their disappointment when they learn that one-third of Russians are looking to make a permanent move abroad, as 60% intend to send their children to be educated overseas.

Generally, UHNWIs living in Australasia seem happiest with their lifestyles only 4% want to change their country of residence or domicile, and very few send their children overseas to be educated.


 One-third of Russians are looking to make a permanent move abroad 


Luxury Spending by UHNW Will Grow

The general outlook for luxury spending continues to be positive. Almost a third of respondents to The Wealth Report’s Attitudes Survey expect their wealthy clients to spend more on luxury goods in 2015, compared with just 8% who expect it to decline.

Ledbury Research estimates that 2015 luxury spend will be highest in the United Kingdom, both by the power of its own wealthy population and visiting UHNWI’s. The Big Spenders Index identified China, Qatar, Canada and India as the remaining Top 5 locations.

Though the total omission of the United States from the Top 10 seems puzzling considering the U.S. is still thought to be the worlds #1 market for luxury goods.



The Next Generation Spends More on Luxury Goods

Time for some good news for luxury brands, the younger generation want to spend lots of money on luxury goods and post it all on Instagram. Family succession was the #1 concerned identified by UHNW’s in the Attitudes Survey by Knight Frank.

Wealth and inheritance taxes aside, 66% of younger UHNW’s spend more on luxury goods than their parents. Older generation UHNWI’s are also concerned about the Internet, and the younger generation’s propensity to flaunt their wealth online, making them a target for cyber crime.


 66% of younger UHNW’s spend more on luxury goods than their parents 


Go Where the Wealthy Are Going

Don’t go where the wealthy came from. According to NetJets, Moscow to Nice (Cote d’Azur) was the most travelled private jet route of 2013. Followed by Miami to NYC, NYC to Los Angeles, NYC to West Palm Beach, and London to New York.

Granted, this data must be skewed by the sheer number of Private Jet users in the United States and the fact that NetJets is strongest in North America. But above all it confirms just how prosperous this area of the world is, and that it’s UHNW residents are not holding back on spending their wealth.



This Is a Man’s World

At least on a private jet it is. According to NetJets, over 80% of private jet passengers are male. The typical age for flyers is 40-55. Private entrepreneurs dominate in terms of profession. Source of wealth tends to be from finance and the oil and gas sectors.

NetJets reports that flyers from the property industry have returned in the past 12 months, joined by owners of technology companies.


 Over 80% of private jet passengers are male 



1. Wealthy individuals still have plenty of cash reserves to spend on luxury, and in the case of diamonds and gold, they often see luxury consumption as an investment opportunity. The real challenge for luxury brands is creating exceptionally interesting products that engage consumers that have the financial power to buy anything they want.

2. We are living in the age of eCommerce, at a time where more consumers than ever before have the financial power to travel, particularly wealthy ones. These wealthy consumers are still travelling to the tried-and-tested hotspots; London, Cote d’Azur and New York, where luxury brands already have significant retail footprints.

Instead of investing in far-flung brick-and-mortar pipelines that could take years to be profitable, shouldn’t luxury brands be thinking about optimising their retail experience in Dallas for traveling luxury consumers? As oppoed to opening a new expensive flagship in Dalian?

Or perhaps optimising their eCommerce offering for global shipping? Just as Net-a-Porter have been doing for over a decade. Or contextualising their eCommerce website in terms of language, colour and cultural relevance? Increasingly, the only localisation necessary for a luxury brand is that of its marketing.

3. Finally, the Rich Kids of Instagram is actually a phenomenon. Regardless of whether ethically we agree with the way these people behave online, their social presence has somewhat normalised the way that wealth is actively promoted on social media.

Justifiably, their parents may not like it. But these kids are on social platforms bragging about luxury brands, which should give brands an insight into where the next generation of UHNW individuals should perhaps be targeted.



To further investigate wealth and affluence on Luxury Society, we invite your to explore the related materials as follows:

- Risky Business in Russia’s Luxury Goods Market
- The Top 50 Most-Searched for Luxury Brands in Russia
- Must Know Russian Luxury Brands


About the author

Doug Gollan

Co-Founder and Former President

Elite Traveler is bi-monthly, audited by BPA and distributed aboard private jets, mega-yachts and other high-end venues in over 100 countries around the world.

Elite Traveler Superyachts is distributed globally aboard super yachts and in private jet facilities serving super yacht marinas. With Elite Traveler's award winning format, it is focused on the superyacht lifestyle.

Elite Traveler Asia will be launched in June 2011 bringing the best of the private jet lifestyle to Asia's rapidly growing private jet traveler market. Each issue will contain original editorial specifically targeted to the Asia based consumer who flies by private jet.

Elite Traveler Getaways is our regional travel magazines with editions for the Western US, Eastern US and coming in 2011 Europe. Each issue (Winter and Summer) focus on private jet getaway ideas for our high travel audience. is the private jet lifestyle online. Over 80 percent of users are private jet travelers and over 70 percent say our content influences their purchasing decisions

Co-Author, The Sky's The Limit - Marketing Luxury to the New Jet Set