SuperyachtNews.com – Owner – The hustle generation
We take a look at where millennials get their money and what their spending habits are…
Inside the next New Build Superyacht Reporting we look at the true potential of the superyacht market and how it compares to global wealth forecasts. Following the flurry of data and research, we noticed some interesting and valuable information about the next generation of potential customers – Millennials. partly because of the difference in their interests compared to previous generations. However, they are also interesting because their emergence as the dominant demographic group in the ultra wealthy slice of the population is so imminent – oldest ranked millennials turn 40 this year.
The first thing to note is that the majority of wealthy millennials are self-made and are often involved in the tech industry in one way or another. The characters and interests of individuals who will make the richest people in the world are of interest not only to companies in the superyacht industry, but also to any brand operating in the luxury market. For example, about 20% of all UHNWIs whose wealth is derived solely from inheritance say they are interested in art, while art ranks lower for those whose wealth is even partly self-built.
There are other factors to consider, for example, the fact that the wealth bracket is getting younger means that physical activity is becoming more popular for those interested in luxury brands. The sport has actually been identified as the number one interest for millennial VHNW people. As this generation has grown up being able to go overseas with relative ease, there is a much higher interest in travel and adventure for millennials compared to older generations. For the superyacht industry, it could be a tip of the hat to the idea that next-gen owners want to travel to far-flung places too far.
Perhaps the most interesting and surprising idea is that rich, self-made millennials are not as interested in philanthropy as other categories in the ultra-high wealth bracket. This is because they are more likely to focus on their career in the early stages of life. However, as their net worth increases with age, they become more likely to want to spend their accumulated wealth on personal and emotional ambitions. The drive to give back to society and leave a legacy tends to come to those who are wiser and more experienced. Thus, suggesting that the drive for sustainable initiatives does not necessarily always have to be tied to the rising generation of millennials.
Philanthropy is however the primary interest of UHNW people with inherited wealth, with 50% of people who received all of their wealth through inheritance said they were interested in philanthropy. It’s probably because this specific demographic doesn’t have to worry about job responsibilities. It could also be argued that they may feel more compelled to engage in benevolent causes due to their awareness of their obvious financial privileges. In addition, philanthropy is by far the most popular interest among UHNW women, although this trend is gradually changing, this correlation could be due to the fact that, compared to men, a higher proportion of UHNW women owe their wealth exclusively to inheritance.
According to a study conducted by Boston Private, millennials measure wealth by personal success and purpose, rather than hard, cold numbers. They’re more likely to buy experiences rather than things, and they want to buy things that are easily displayed on social media. At the same time, it’s important to note that many ultra-affluent millennials owe their success to the culture of hustle, viewing themselves as workaholics and martyrs to work. According to an article published by The Harvard Business Review, 35% of Millennials think it’s good to be seen as a work martyr by colleagues. Millennials are also more likely to give up unused vacation days (24%) and (59%) are ashamed to take or plan a vacation – perhaps an interesting statistic for an industry that ultimately sells the most luxurious form of relaxing escape.
For now, Millennials represent a tiny, almost insignificant proportion of the $100 million+ category. But as they begin to emerge as the superyacht industry’s most popular potential customer group, it’s important to remember that we can’t always smear the next generation with the same brush. Although many stereotypes ring true, important considerations such as the lack of philanthropic interest and benevolent causes among the younger generation run counter to common assumptions.
Click here to become part of The Superyacht Group community and join us in our mission to make this industry accessible to all and prosperous for the long term. We offer access to the superyacht industry’s most comprehensive and longest-running archives of critical information, as well as a comprehensive, real-time database of the superyacht fleet, for just £10 a month , because we are an industry with a mission. Register here.