The hustle generation
We have a look at where millennials are getting their money from and what their spending habits are…
In the upcoming Superyacht New Build Report we delve into the true potential of the superyacht market and how it compares with global wealth forecasts. Upon the flurry of data and research, we noticed some interesting and valuable information about the next generation of potential clients - Millennials. They are a generation of people who have been extensively reported on by SuperyachtNews, largely because of how much their interests differ from previous generations. However, they are also of interest because their emergence as the domineering demographic in the ultra wealth bracket of the population is so imminent - the oldest classified millennials are turning 40 years old 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 some way or another. The characters and interests of individuals who will make the wealthiest people in the world is of great interest not only to businesses in the superyacht industry, but also any brand operating in the luxury market. For example, roughly 20 percent of all UHNWIs whose fortunes stem solely from inheritance claim to have an interest in art, whereas art ranks lower for those whose wealth is even portionally self-made.
There are additional factors to consider, for example, the fact that the wealth bracket is getting younger means physical activity is becoming more popular for those interested in luxury brands. Sport has actually been identified as the number one interest for millennial VHNW individuals. As this generation has grown up being able to go abroad with relative ease, there is a much higher interest in travelling and adventure for millennials compared with older generations. For the superyacht industry, this could be a tip of the hat towards the notion of next generation owners wanting to travel too far flung remote locations.
Perhaps the most interesting and surprising insight is that wealthy self-made millennials are not as interested in philanthropy as other categories in the ultra high wealth bracket are. This is down to the fact that they are more likely to be focusing on their careers during the younger stages of their lives. However, as their net worth rises along with their age, they become increasingly likely to want to spend their accumulated wealth on personal and emotive ambitions. The drive to give back to society and leave a legacy behind tends to come to those who are wiser and more experienced. Thus, suggesting that the drive for sustainable initiatives doesn’t necessarily always need to be linked to the rising generation of millennials.
Philanthropy is however the leading interest amongst UHNW individuals with inherited wealth, 50 percent of people who have received all of their wealth through inheritance said they were interested in philanthropy. This is likely because this specific demographic has little to worry about in terms of professional responsibilities. One could also argue that they may feel a greater obligation to engage with benevolent causes due to their awareness of their obvious financial privileges. Furthermore, 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 the cold hard numbers. They are more likely to buy experiences rather than things, and they want to buy things that are easily flaunted on social media. At the same time, it’s important to note that many ultra high net worth millennials owe their success to hustle culture, seeing themselves as workaholics and work martyrs. According to an article released by The Harvard Business Review, 35% of Millennials think it is good to be seen as a work martyr by colleagues. Millennials are also more likely to forfeit unused vacation days (24%), and (59%) feel ashamed for taking or planning a vacation - perhaps an interesting statistic for an industry which ultimately sells the most luxurious form of getaway relaxation.
For the meantime, Millennials make a tiny, near insignificant, proportion of the $100m+ category. But as they begin to emerge as the superyacht industry's most popular group of potential clients, it's important to bear in mind that we can’t always tarnish the next generation with the same brush. While a lot of the stereotypes do ring true, important considerations such as the lack of philanthropic interest and benevolent causes amongst the younger generation go against common assumptions.
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