“The brand reinforcement is everywhere; ubiquitous banners, boats, waterfalls, give-away bags, limousine service and big dollar functions that just seem to get bigger each year,” he wrote of 2011’s Monaco Yacht Show. “I mentioned to a colleague that soon I expect to see leopards on leashes and cage dancing – I think the broker beside me wrote this down.”
For this captain, the disproportionate marketing budgets spent on being larger than life at the boat shows was not only distracting from what companies should be there to do – i.e. serve the clients – but was effectively making a mockery of the fees that the owners are paying. “This is an arms race of excess, with firms having marketing budgets for this event alone that extend towards €500,000,” he said. “How can this benefit my employer – the yacht owner?”
For many, the spectacle of it all is part of the attraction to the shows. The Monaco Yacht Show (MYS) in particular, ‘the greatest show on earth’, is always the scene of many an indulgent display, with everything seeming to get bigger each year in a never-ending game of one-upmanship. But is it fair to suggest that companies rein it in? Marketing and brand awareness have always been integral to any business’ growth, no matter what industry you are in. In a realm like this, where the very product we are selling is an unabashed life extravagance, the marketing can surely get away with being less-than-understated. As long as these companies aren’t charging you, the owners, extra to fund show time campaigns and events, arguably their choice to have leopards on leashes is more a question of taste than of an owner’s value for money.
This anonymous captain’s almost puritanical marketing advice did get me thinking about the efficacy of these campaigns though, raising questions about who this overt extravagance is aimed at: as clients, do you expect it or even want it anymore, or is it simply a show of brand strength for the industry? A kind of ‘my brand is bigger than your brand’ situation? What are owners and potential clients at boat shows looking for and will they be charmed by this branded face-off?
As a result of globalisation and the digital information revolution, clients in all sectors, including superyachting, are able to come to the table better informed and more aware of what they want. The traditional role of brands was to reassure clients of product or service quality, but clients are more able than ever to teach themselves what companies can offer them. The upshot? It is now building trusted relationships and being able to offer a truly bespoke service, not over-the-top shows of brand strength, that will win business.
Experience over the last couple years tells us that we have been moving into a new era of owner. We all know that the wild abandon that characterised this unique realm of ours pre-crash gave way to caution. As clients, you are savvier than ever. While there are always going to be those who are swayed by flamboyant sales-pitches, goody bag ‘bribes’ and the concept of conspicuous consumption, more are increasingly likely to be wooed by knowledge, value and personal relationships.
A new survey by the Luxury Institute showing how this emphasis on relationships especially applies to the next generation of UHNWI aged under 45 caught my eye recently. The survey looked at the wealth management preferences of investors and revealed that while older generations favour working with full-service firms, wealthy Millennials and members of Generation X and Y (defined as those 45 and younger) showed a marked preference for independent wealth managers compared to full-service brokerage firms. The difference between what the bigger firms and the impendent ones offer lies mainly in the relationships.
“Affluent Millennials expect truly individualised and personalised experiences,” Milton Pedraza, CEO at the Luxury Institute explained when I asked him what this preference demonstrated. “All larger service providers in most categories where clients pay substantial fees need to transform their cultures so that both their individual associates and brand are, and are perceived as being, true experts who are trustworthy and generous.”
Clearly, if this industry wants to get better at attracting the next generation of yacht owners we need to take note of this; the companies that do well will be customer-, not brand-, focused. Frankly, I would argue that the preference for more bespoke service provision is something that is already of ever-increasing appeal to owners across the board, no matter what generational category they fall into. It shouldn’t be a surprise that the majority of owners tell me that most of the key decisions they make – where to build, who to list with, who to hire – are based on the advice of people they like and trust. While it once was simply being a recognised brand that earned your trust, today it is all about the individual.
So, back to the boat show brand wars. Boat shows, particularly MYS, are chaotic, exhausting and overwhelming at the best of times. If you are a new or inexperienced owner, it can be akin to jumping into a shark tank. If the guest list for The Superyacht Owner’s VIP Lounge over the last three years is anything to go by, the typical owner who makes the decision to come to MYS for more than a couple hours has done their research, wants to gauge the temperature of the market, enjoy the energy, the news and the process, but is serious about building on knowledge and relationships.
Maybe it is time for the industry’s service providers to go the way of the rest of the luxury realm, where subtlety and discretion are the new marketing buzzwords.
Enjoy the show …
This article is taken from Issue 18 of The Superyacht Owner, out now.