#H2HChat: The Forgotten Power of the Boomers, Brian McLead, Forbes & Mike Lees, CMO WealthEngine

Hey everybody, this is Bryan Kramer. We are back for another H2H chat. What does that mean? That means it's Monday in some countries, and it also means that it is noon in Pacific Standard Time. But ironically, nobody on this chat except for Brett, who's behind the scenes, is actually in Pacific Standard Time, I don't believe. And so that's kind of fun for all of us to be able to finally say that we are not on Pacific Standard Time, but you might be. Anyway, welcome to HAA Chat. Suzy, how are you doing? It's a little late. I've had a couple of days of travel here.

Now that we've got the time zone thing out of

the

way. I'm listening. I am live from Dublin, Ireland, really excited to be here. I'm talking to Suzy, my co-host in New York. How are you doing?

I'm doing well. I'm doing well. I think I've had a bit more sleep than you have, I must say.

Yeah, I know. I think I knew what I was saying, but I'm not

sure. No, it's coming across clear. I have to say, I am so incredibly jealous that you're in Ireland right now. Like, that's just, yeah, too much fun. I'm expecting all the photos to come through.

Well, it's dark now, so expect them definitely tomorrow. And for anybody watching— I will be tweeting live from Dublin. But back to the agenda here, I'm so excited to also have our guests here. We have Michael Leiss. Michael, how are you doing today?

I'm good, how are you? I think we crossed in the air somewhere this morning, Bryan. I flew back from the UK this morning, so

I've

had very little sleep too.

Oh wow, see, this is going to be a theme. So Michael is the Chief Marketing Officer for Wealth Engine. Welcome, Michael. Good to be here. And with a little sleep and lots of coffee, good to see you. And Bryan McLeod, Director of North America Forbes Insights. And Bryan just flew to Florida this morning, if I'm not— I believe I'm correct. quoting you right, that you are now in Florida having flown out from San Francisco.

That's correct, yeah, I'm down here for the Forbes CMO Summit which starts tomorrow night.

Fantastic, so with little sleep we have Bryan. So we've got everybody on here. Bryan and Michael, welcome. The title of this is The Forgotten Power of the Boomers. It's really interesting, as I was talking with with Wealth Engine about this great report that was coming out, I thought it would be a really good chance to be able to talk about something that I think a lot of people don't actually discuss as much as they should. Based upon this now report, I think it helps us to describe exactly why and what we should be doing with boomers. And so that's what we're basically going to be talking about here today. So with that said, why don't we start with you, Michael, and just why don't you tell us a little bit about the report and By the way, the report is produced in collaboration— you guys correct me if I'm wrong here— but in collaboration with Wealth Engine and Forbes Insight and helps to express the research that was done. We're going to be talking about the research that was done around the boomers and how to market to the boomers. Michael, why don't you take over from here and tell us a little bit about the report?

Sure. So first of all, thanks again for having us, Bryan. It's a great opportunity. Welcome, everybody. So what we started to do with this report was we basically started with the hypothesis that right now, if you look at the current data, I think we have some data from AARP in the report, the boomer-plus generation, so 50+, still controls a massive amount of consumer spending in the US. The predominant part of income comes from that group. So as our community, as the marketing community, talks a lot about the shiny penny of millennials, we kind of felt that the pendulum is at risk, maybe hasn't swung all the way towards millennials yet, but is at risk of swinging too far in the other direction. Everyone's obviously rushing to get on the digital bandwagon for economic reasons and reach reasons and scale reasons, if for no other reason. And we really wanted to understand how does that play with the boomer generation? How do you get the balance right when you've got a generation that may not be as engaged in social networks and digital channels, but as a marketer, you've got to use digital channels in order to make the economics of your outreach work? So the report is really about how do we understand and get the fine balance right, particularly in luxury markets where it's experiential And where the vast majority of money is coming from that boomer-plus generation that just interacts differently than millennials online.

Fantastic. And I think, you know, that's the other thing. I saw this just in a tweet just now about, you know, that everyone is talking about millennials all the time. And by the way, I'm sorry for any millennials that might be on this chat with us for any— yeah, we should have a certain sound here just every time we say Every time we say millennials, since— let me see if I can pull it up. I'll pull it up here in a second. Oh, that's a good one. Your millennial sound is going to be this right here. And every time we say boomers, it's this.

I like

it. And if you say human or H2H, it's this. Adding sound

effects.

So we have just set the ground rules for the rest of the chat. Thank you. All right, so Bryan, why don't we move over to you and have you describe a little bit more since you also worked on this report?

Yeah, I think this is a great collaboration that we did with Wealth Engine. We talked to some wonderful interviewees and surveyed over, I think, 500 people for their support, all from high-net-worth individuals and families. And I think it was just really interesting, as you said, Michael, to look at at these folks and to really get their perceptions about how they like to build relationships with brands. As you said, so much is focused on digital these days, and I think these guys are even less focused on brands, we learned through the research, and more focused on quality. And that was a huge takeaway for us. So I'd love to get your thoughts on that and hear from the audience on what they think about luxury brands that have been around for 100+ years and what is it about them that that brings them to these brands.

Yeah, I am very, very interested in that, especially since they aren't, in my perception, one of the most digital— and I think your report kind of talks to this— is they're not the most digital era or areas of what I saw come out of, you know, what you guys learned there. So I'm curious to hear about that, but before we get into that, Why don't we just talk about the boomers in general? Just kind of give us a makeup of who they are in generality. Bryan, do you want to start with that?

Yeah, sure. So, you know, really I think we're looking at the 50+ crowd, but more specifically we're looking at the 50+ crowd with, you know, over— or with a net worth of over $1 million. So these were folks who are focused on luxury experiences and luxury goods, and they're looking for things that add value to their lives. They've owned businesses, they've had careers, and now they're moving into retirement. I think that's what we hear a lot about when we're talking about boomers these days is the focus is entirely on retirement. Obviously, this is a huge generational shift that we have going on with the boomer generation, and obviously as the millennials come into taking power and controlling things. That's going on as well. So this was really a great opportunity to see what's happening as this generation leaves the workforce, maybe continues to leave their business, looks for philanthropic efforts, and really looks to kind of experience travel and food and brands in a different way.

And I just realized that if I am going to put a sound into boomers, then I'll just be doing this almost every other word. So I'm going to do this every so often instead. So that's great. Michael, do you have anything to add to that? I know that you guys were— first of all, can you do me a quick favor and talk about, just real quick, not that this is an advertisement, but Wealth Engine is really, really cool, and I really want everyone to hear what you guys do just so that they understand. I mean, obviously, you know, this is just me asking you guys to be on HHChat, so just tell us, what does Wealth Engine do?

Alright, let me try and give you the potted version. So let me talk about what we did and what we do, because it's an important distinction. So we've been around since 1991. So what we did was we were set up to help nonprofit organizations. We have about 2,700 nonprofit clients in the US, pretty much the market leader in the nonprofit space for prospect research. So who knew that nonprofits invested a ton of money in very sophisticated data analysis? So they only ever want to reach out to someone that they know has the propensity to donate and the affinity to their cause. So we do 2 simple things for them. We help them understand their donor base. Number one, we give them sometimes in excess of 2,000 attributes. So we have a database of about 2,000 attributes on 240 million adults in the US. And we score every single household in the US for wealth and propensity to invest, propensity to spend, propensity to donate. So think of us as what Klout is for social media influence, Wealth Engine is for propensity to spend. So we allow them to understand their donors better. So Bryan, you may have given $25 to the Humane Society, I may have given $25. They don't know which one of us could give $50,000, which one of us might give $1 million. We're not going to make any guesses right now. I suspect your gift might be a little bit bigger than mine, Bryan. So that's the simple fix that we give for them. Then the more sophisticated side of it is we're able to go in and do some fairly neat predictive analytics. So a lot of these organizations do have a large number of donors that have given $50,000, $100,000, even $1 million. What we do is say, well, what do they have in common? What's their fingerprint? And we say, go back and find me more people that look just like that. So that's what we've done historically. Now, if you think about what I've just described, pretty much every commercial business-to-consumer marketer now has exactly the same challenge. None of us can afford anymore to fill the funnel full of faceless individuals and just hope that volume means that 3% of them fall out of the bottom of the funnel. We can only afford to reach out to the people that we know have the propensity to spend on our products and the affinity to our brand. And technology allows us to do that more than ever. Digital technologies in particular allow us to micro-segment. This isn't about personalization as much as it is about building micro-segmented cohorts that we can market effectively to at scale. Because anyone can do personalized marketing when it's one person walking into the store, but how do you do that personalization at scale? So really what WealthEngine is, is we're a massive consumer database that does predictive analytics, so you take the guesswork out of who you want to talk to and make sure you're only talking to the people who can afford what you're selling them.

That's awesome. Thank you so much for doing that, because I think that really helps everyone understand how— I mean, it's one thing to understand the generation. It's another thing to understand how to market to a generation or connect with a generation. And you need that. You can't just— I mean, you could develop a study until the end of time, but you still need to know how to connect with them. So, that's why I wanted you to let everybody know about that. So, just continuing forward in our little boomer journey, it's funny because here's the irony here, and I love our audience, but we have some boomers on Twitter right now, and the thing is that we have the most awesome community ever. And yes, we do have boomers on there, but you guys are probably the cream of the crop of boomers because you're all technologically savvy and you're tweeting alongside something that we're talking about on a Hangout. So this is kind of funny that we're all using technology to talk about this. Anyway, I just thought it was ironic. But I want to get into that a little bit more around The technological use and what you guys found out of the research that you did, what is it? Are they technologically savvy? Are they not on the whole, or does it kind of fall in between? Where is the technological aspect of boomers, and what can we take away from this? Let's see, Michael, you want to go first?

Yeah, let me— could you see me chomping at the bit there? Yeah. So let me take a quick stab. So I always think my parents are a great example, right? My parents are in their mid to late 60s. And it's not that they aren't technologically savvy. They're actually pretty sophisticated. There's more Apple products in my parents' house probably than in my house. But I think it's their desire. Their social network is massively valuable to them. And I think the report found this as well, that they've got a very valuable social network. And the biggest messaging that they want to receive is from word of mouth. They just don't do it online. So it's not that social isn't important. In fact, it's the most important. It's how do you do that when they don't hang out online? I think this audience is self-selecting because this is a social product. But when your audience fundamentally just doesn't hang out on Twitter, how do you take advantage of that social network? It's about how do you get the word of mouth? marketing machine scalable and in place without necessarily taking advantage of digital products. So it's not that they're not technologically savvy, it's just that they don't use these— they're not used to using these products.

I see. So Bryan, what do you think about that?

Yeah, I mean, I thought it was interesting. I mean, a lot of, you know, we found in this report, it was quoted that people talk about this generation as the generation that still reads and gets and values a lot of direct mail. And other folks were talking about how the smaller portion of their budget went towards digital, where the larger portions were going towards direct mail and their new magazine and in-store things that were experiential. I think that's pretty interesting. I think, as Michael said, what we found was the things that these individuals valued the most, and I think what we all do, whether we're Millennials or Boomers, is that social reference point. It's about how do you get it, where it comes from. Is it the person in your neighborhood, the person in your country club, or is it the person in your book club that's recommending that you go out and check out that new car or that new handbag or whatever it might be, or where did they go on vacation last summer and who did they book it with? So I think that was very interesting to us. I think what was also very interesting was, you know, there are the way that they kind of handle privacy and transparency about letting people into their lives and building relationships with brands, I thought that was pretty interesting as well.

One other thing I would add, Bryan, is just going back to the point about sort of being digitally savvy. One of the interesting things from the report, and I think there was a quote from— I can't remember which which organization it was, but it was, our website is where our customers dream, our stores are where they actually purchase. So I think there's a difference between at what point in the overall cycle. So I think one of the things is we've got to look at the end-to-end purchasing cycle, and I think the boomer generation is no different than the millennial generation in that they're going to take advantage of the fact that all of the information to do the research is available to them online. I think the difference with this generation is that when it comes to actually making the purchasing decision, they're much more tactile and much more human-centric. Do I get a cheer for saying human?

I couldn't get to it in time. I'm like, oh, he said it!

When it comes to the actual transactional side of it, they want to look a person in the eye. They want the experience of being involved in the brand, and the experience is part of what they're paying for. I think it's also a case of looking at this not in terms of demographics, but in terms of what stage of the overall purchasing and decision cycle different tools are relevant for.

It's true. Yeah, no, I could see that. I'm curious now, what did you guys— what did you see here out of the types of brands? myself that it was a lot of luxury brands. What categories or what kinds of products are we looking at here?

So we had some folks from Hamilton Jewelers, HomeAway, which actually is a digital vendor, Houlihan Lawrence, which is what you think of when you think of high-end real estate, Butterfield and Robinson, Leading Hotels of the World, Coravin, which is a fairly new technology in wine, and Virtuoso. So definitely skewed towards the luxury side of things, and most of the folks were a range of folks from cross-platform marketers to heads of digital marketing, guys who focus on customer segmentation. So we got a range of opinions on this from You know, a range of luxury providers.

We actually saw quite a lot of different trends as well in terms of the different luxury products. If you look at travel, it's a great example. So the report highlights very different behaviors in terms of travel. People are much more willing to, you know, back to my previous point about the overall purchasing cycle, it looks like the boomer generation are much more willing to buy an end-to-end product online in the travel in the travel market, but still they want that concierge service. So they want that online travel agent who's at the end of the call. So I think, you know, and then if you look at electronics, that was another area where people were able and willing to buy online. So I think some of these markets, when you're talking about luxury, it's really, luxury is relative, right? Luxury is relative to the lifestyle that you've got. Wealth is relative as well. So electronics may to a lot of us be a consumer, even if they've got a high price point, they're They're really a commodity item. So I think when you look at how boomers buy online, products like that is very similar to millennials. When you look at the report in terms of real estate, jewelry, automotive, that's where you see the biggest difference, I think. This is a generation that really wants those products and clothing. They want the experience face-to-face. They want to touch the product. They want to feel the product as part of the end-to-end cycle. So the report did highlight difference. different behaviors across the different types of luxury products.

So what surprised you? What did you take away that you really never saw coming? Did you have a moment like that, or did it just confirm everything you knew? No,

it definitely didn't confirm everything we knew. I'll let Bryan answer from his perspective as well. One of the biggest surprises for me was that the leaning towards direct mail in the Boomer+ generation. A lot of us think that the direct mail ship has sailed and that people are really moving— have moved already dramatically to digital, but this is one segment where when you combine luxury with Boomers, direct mail still works. And if you look at the— I can't remember the actual data point, but the number of Boomers in these luxury markets that respond to direct mail and read direct mail is unusually high. That really struck me as something extremely interesting. Again, it's about a tactile experience, it's about receiving something, reading something, feeling something, and email was unbelievably low for the luxury audience in terms of response rates.

Yeah, and I think from my perspective, I mentioned it earlier, was this finding around quality versus brand affinity. I think a lot of times when we talk about luxury and we talk about brands, that's the first thing that comes to mind is the logos and the hotel that you stay stayed in or the restaurant that you went to or who did you book with, right, and you talk about the brand. But really, what really meant the most to these individuals was the quality of that experience or the quality of that product, and that stood out more so than any other thing. You know, maybe these folks are used to having so many brands in their lives like that, that, you know, that was one reason why they kind of went towards, oh, it's all about the touch of the leather or the size of the diamonds or whatever you're talking about. or the quality of the wine versus the label of the bottle, that we found that. But I think that was a huge surprise for me.

One other thing, I would also say, one other surprise was I was expecting to see a fairly strong reaction against the use of data for personalization in this group, and that's actually one thing we didn't see in the data. We really didn't see anything that tilted them either way. There was kind of a general trend that if they could be convinced that a brand was using data in the right way and was being transparent about the use of data, then they were kind of okay with the collection of that data. So I was expecting to see a very sort of strong sort of anti-data collection, anti-personalization trend emerging from the boomers, but we really didn't see that in the results that came through.

Yeah, that definitely makes for a hard report when you approach a segment being collected for data and not having data. It's like ironic there, but I'm glad that it worked out for you. So I am definitely curious too, because you're talking about— well, you're talking about personalization, you're also talking about, in some sense, I'm sure, security. And security, if anyone cares probably about security, it would be this group. Can you guys talk about that? What did you find there?

So— Go ahead, Bryan.

I was going to say it wasn't something that we dove into, but I think privacy was one of the areas that we obviously got into a lot in terms of letting people in and sharing data, as Michael was talking about. The fact that these people were willing to be more open if brands and marketers were more transparent with them about why they were collecting or what they were collecting and who it was being shared with. So I think that ties back to security, obviously, but it wasn't something that we dove kind of headlong into. Michael?

Yeah, I think sort of privacy and security go hand in hand to some extent here. It's, are you collecting my data and are you treating it responsibly? And, you know, we saw exactly the same trends in this in this group, as I think we see across the different demographics, it's show me the value in collecting my data. If you can show me that collecting this data delivers a better experience to me, delivers actual value, then I trust it, right? It's kind of the Uber model. The collective intelligence of Uber, I can see that them collecting data about where I travel to delivers value to me. Unless you can make that connection between, I'm collecting data and here's the positive value that I'm delivering as a result of that, people will be suspicious. And that comes through, I think, regardless of the demographic. But, you know, for me, it always comes back to the same challenge. And we presented the questions in this report the same way that I always present them to people when I'm speaking to people. You ask them 3 simple questions. Are you sick and tired of getting a lot of spam? Everyone says yes. Do you like personal experiences? Everyone says yes. How do you reconcile that? Are you willing to give up data to get personal experience? You can't have one without the other. And that's just a trade-off that people are slowly starting to grasp, regardless of which demographic they fall into.

Interesting. Yeah, because I was saying yes to all that. as well, so I would imagine that maybe I was— I'm a reborn boomer, I don't know. So I'm a born-again boomer, that's what it is. So let's dive back into the personal experiences a little bit because we barely touched upon it. I want to understand more what is considered a personalized experience both offline and online to to the boomer segment. Bryan, you want to talk about that?

Well, I mean, I think about it, you know, in terms of the brands that we talked to, the people that we interviewed. Again, when you're talking about real estate, obviously you're making a huge decision. It's probably obviously the biggest decision that many people are going to make in their lives, and they want somebody that's going to be, you know, holding their hand and supporting them through that journey of buying a home, whether it's their first or second, third, whatever. There's things that they have to navigate, there's things they have to know how to do. risk that they have to manage. And so they want that trusted advisor to take them through that. And I think there's obviously brands and individuals that specialize in managing, getting into that at different levels. I think Houlihan Lawrence is probably one of those brands that stands out in my mind as having one of those types of brands. We talked to them for this study, and I think that's That's one of the things that they really focus on. Again, you know, we talked to their head of digital who said that they, you know, that they do have a smaller portion of their budget is focused on digital marketing, or probably the larger portion is on, you know, materials and brochures that they're creating to, you know, use in high-touch environments, which is pretty understandable because you want to have that person-to-person experience and in-person, you know, high-touch environment.

Sorry, before I transition over to Michael there, I just want to make sure that everybody who's new to #HCAChat, because I'm looking at the tweets here and we've got a lot of new people on as well as some of our great community on weekly. I just want to make sure that everybody knows that the second half of this, which is going to start in the next 5 minutes, you can ask questions. So if you throw a question out on the hashtag #HCAChat, Susie's going to be Redirecting those questions to our guests, so feel free to ask questions as we're going along. Throw them out on Twitter, and and those be redirected here. So live, possibly and probably using your name, so you will you will be H to H chat famous. You should do it. I guarantee it'll make you H to H chat famous. So Michael, what? One of the questions that I had here as a follow-up to what Bryan was just talking about is how to engage them online. We talked about personalized experiences. Now, how do we personalize an experience towards a boomer, or how do we engage a boomer online? What are your thoughts there?

Yeah, so the follow-up that I was just going to give— I think this answers your question, Bryan— but the follow-up I was going to give to what Bryan said is that You know, I think it's possible to personalize and customize. I kind of use the two in the same way. Personalize and customize an experience online, offline, a combination of the two. Whichever way you do it requires a significant amount of investment and commitment. You know, it's not about just a personalized message. It's about looking at the end-to-end experience. You know, I met a really fascinating guy last week. So a lot of people will know Jack Mitchell, Mitchell Stores, wrote the book Hug Your Customers. I was at an event last week and met his son, and he was talking about the experience at Mitchell Stores. So Mitchell Stores are— they've been around for a long time, focus on the leading luxury and high-end clothing ranges, designer fashion ranges. And they've typically been an in-person experience brand. But one of the things that they experimented with last year was a new online service where you could actually go online, you could put together a basket of goods that you wanted to see, they would pull all of those goods together and bring them to a store, and you would go to the store and have that in-person experience where you'd have a personal shopper present the items that you found and researched online, and you would have the personal experience in the store. Massive amount of investment by Mitchells in order to get that done, but it's a great example of a blend of sort of personal and in-store experience. Now, the interesting thing was what Scott was saying was they typically ended up selling a very different basket of goods when the person was in the store, because they got the experience to understand them even better face-to-face and find out some things that they didn't know by just interacting online. So equally, there are other organizations like HomeAway in the survey where the whole experience is online, but they equally had to invest a significant amount in the infrastructure to be able to deliver that customized travel experience or that customized real experience. real estate experience online. So one of the key takeaways here is whether it's online, offline, or a blend between the two, you've really got to invest in making sure that it works.

Yeah, I can see that mattering quite a bit, especially if you have all these different segments amongst the boomers. You have to figure out what's going to work for who. and test and try. Bryan, anything to add there?

No, I think you did a good job of covering it. You know, we see this a lot as, you know, you see folks like Nordstrom's moving into digital with Trunk Club and changing the shopping experience and making that more personal. You know, you see grocery store outlets and things like that experimenting with home delivery and online shopping. It's not just the Amazons and the Googles of the world, it's a whole— everything is evolving.

I found this quote pretty interesting. This is directly out of the report. By far, what wealthy 50+ consumers are willing to do to promote a brand is share via word of mouth. That was 84%. And then the distant second, 21% for this segment, is writing reviews on brand websites or a third-party review site. What do you guys think about that?

I think that's kind of interesting, because I actually don't see that as any different to millennials. I think the difference is that when a millennial complains about a brand or promotes a brand, it propagates out to a much more significant audience. The counterpoint to that, though, is I think when you're looking at the luxury end, where one individual customer or transaction maybe maybe dramatically higher, even though there's probably less of a network effect when a boomer sort of promotes your brand or generates negative comments in their network about your brand. It may propagate less far, but the impact financially is significant, because each individual within that network is potentially a higher-value transaction that you've that you've lost. So I think both generations have got the same impact. It's how broadly it spreads and how valuable each one of the nodes is.

Yeah, I think you nailed it. Ultimately, I think what needs to happen is, as a brand, you need to change the desire for people to write reviews and talk about your brand online in a positive way versus in a negative way. And you can see some people trying to do that, but obviously I think the thing that people jump to first, whether or not they're millennials or boomers, is to go negative. And so how do you make it easy for people to share positive experiences? How do you experiment and customize things that will make them want to kind of take that next step beyond talking to their friends and go online and really, you know, Talk about the individual or the place that made that special.

And look, the one thing that doesn't change based on generation is it's about customer service, right. You've got to deliver great customer service, that comes first and foremost, and once you've delivered great customer service then your customers are going to talk about that through whatever mechanism and whatever generation they sit within. So unless you're delivering the customer experience first and foremost, The reviews afterwards don't matter that much.

So one quick question before I pass you over to Susie and the community for the questions. And again, everybody, we're receiving a lot of questions in here, so you guys are going to have some fun here. But again, please everybody feel free to send some more questions. We'll be taking those for the next half of this, so definitely feel free to throw some more out. But my question to you all is, as we're looking at the luxury brands, is there a case example, or even just in terms of Wealth Engine and having dealt in this segment before, is there a case example of how personalization or online engagement or anything that we've talked about here that you've actually seen work really well? Is there a good case story to share that shows how this could potentially work well?

Yeah, so one great example. So we work with a high-end jeweler in New York, Buccellati. Some of your audience here may be aware of Buccellati. I wasn't aware of them until we started dealing with them, because my means don't extend to many of their But this is a jeweler that really deals in extremely high-end jewelry.

My wife is on this tweet chat and she just heard you say that, so now she's aware of it. Thank you.

There you go. And yeah, their minimum entry point is extremely high, Bryan, so I apologize for that. So one of the things that they did was— so they're clearly an in-person experience organization. They have stores. And a large number of their pieces, particularly the high-end pieces, are customized pieces. The kind of things that you only really purchase and you do buy consultation in a store. But a lot of their outreach is digital, and a lot of their outreach is direct mail as well when they're talking about engaging with new prospects. So they were opening a new store in Chicago. It's one of the first big stores outside of New York in the US that they were opening. One of the things that they did was they invested in truly understanding their existing customer base. So they went in and we appended their existing customer records with all of our data, and we did some fairly sophisticated analytics. Now the output of that is going to sound really simple, but there was a fairly significant amount of analytics that went into understanding that new dataset. And what we found was that in the customers that typically ordered these high-end custom jewelry pieces, there was a strong affinity towards equestrian lovers and contemporary art lovers. So what they did when they were opening their Chicago store was delivered a very experiential offering to be able to attract people into the Chicago store opening, and they partnered with a contemporary art gallery in Chicago. They had some contemporary art pieces made, and they matched those contemporary art pieces with some custom jewelry pieces themed around horses. So, you know, just a great example, and the outreach they did to that in the local Chicago market was digital outreach. To educate people, but the goal was to bring them into this in-person experience within the stores. So that's a great example of just using sort of digital techniques and particularly data and data predictive analytics to be able to understand the audience, reach out with a very personalized message to a very uniquely defined audience. You know, how many equestrian-loving contemporary art lovers with more than $1 million are there in Chicago? And engage them in such a way that I bring them into a specific location and give them a very unique experience. So that's just one example of the kind of thing that we get involved in.

Fantastic. Wow. That certainly sounds like it could be replicated, except I'd ask you not to replicate it in San Jose, California. So I'm going to pass this over to Susie, unless either of you had any further comments on the questions that I've asked you. That was the easy part. I'm kidding. If you guys have anything else, that'd be great. Otherwise, you have— now Susie's full attention. She's going to be asking you questions from the audience. So she has polled the audience, and there are questions coming in. And again, I'd encourage everyone to continue to bring them in, but you guys will have some good stuff here.

Is one of the questions why an English guy has a Pittsburgh Steelers towel over his left shoulder?

We haven't gotten that yet, actually.

But it will be now.

Yes. Awesome. Thank you. I'm so excited to have you guys on. This is definitely a very different perspective. I completely, as a millennial, and Bryan can bear this out, all the millennial chatter drives me insane. I think it's so interesting to bring in this other demographic. We're getting lots of awesome questions from the audience. Please continue to tweet those in, awesome H2H audience. Bryan will message them over to me and they just might make it into the mix. First of all, I actually want to ask a question just with my social scientist background. I'm really curious to know what your selection criteria was going into this report. Where do you go to find these respondents?

Well, that's a good question. So we worked with Wealth Engine to survey the Forbes audience as well as the Wealth Engine audience, and I think one of the reasons we worked together was that those 2 groups are very similar and overlap in some areas. Forbes Insights does about 100 surveys a year on different topics and different demographics globally. This one was particularly fitting for us because obviously Forbes readers, our audience is high net worth individuals. We also do a lot of work covering different marketing trends as well. This was right in our wheelhouse.

Totally. Totally. That's awesome. Anything to add?

What are your thoughts? Yeah, kind of interesting from our perspective when you look at our sort of audience group. We have 3,200 customers, but it's split across what you can imagine is a very diverse customer set. So we have nonprofits on the one side, and we have luxury brands and financial services on the other. And as you can imagine, the people that are involved in those organizations are very different and have very unique perspectives, even though fundamentally wealth and income are big drivers. The level of conservatism in nonprofit tends to be a little bit higher than it is in financial services and luxury. So I think it actually gave us a pretty good cross-section of the luxury landscape the way we did it.

That's awesome. I saw another kind of version of the question comment bouncing around that I'm going to ask and then jump to specific questions. Did you find what was Did you find variance? Does it— female versus male respondents, was that a— did you find a difference there in terms of experience, expectations, or was it about the same?

The survey did skew more male than female in the responses. It wasn't something that we got into in the report, and therefore I'd have to check back with my research director to see what variances there were, but I'm guessing because there weren't anything major, it wasn't something that we went into.

Right. Totally. Totally. I always imagine buying habits switch back and forth. So, all right, let's jump into some of the questions here. So we have a really interesting point that Bryan Moran got into that's jumped into kind of a different back and forth. He wanted to— he said one thing that's important to remember is that boomers range from 51 to 70. So we have 51, right, making like the most money that they're going to make, to 70 when you're dealing with fixed income. What— you almost seem to need to segment this. How did you deal with that in the data? What are your thoughts based on your findings?

Well, I mean, from a segmentation standpoint, we were looking at a wide net worth and a wide group of investable assets. So from an investable assets standpoint, these are individuals who could invest. 7% of them had under $1 million. Right. And 4% had over $500 million in investable assets. So this is a very high net worth group. And so I think when you're talking about the folks who are on fixed income at that level, it's a bit different. But certainly those were things that we broke out and could get into more detail with people if they'd like to follow up.

Yeah, and I think just to add to that, I think when you're looking at this level and the way we skewed this audience and the profile we were looking at, really income is less of a driver than wealth. You know, for 50+, it's really the biggest driver of what these people are spending their money on is is their asset base rather than their income base. These are people who typically retire in their 50s rather than in their 60s, so by the age of 51, they've already got their sort of buying power built up in their wealth base rather than in their income base. So I think wealth is the bigger driver here rather than income.

Hmm, that's a really, really interesting point. So in kind of— Carol has a really— Carol Hopker Burgos, who's been with us since the very beginning— love you, Carol— says, what's the highest ticket item that you guys have found that people are willing to buy online sight unseen? What threshold have you seen?

We did look at a cross-section of items just in terms of what people were looking to buy online. We had 67% of people willing to pay for travel. Apparel was second at 41%. You know, these were things that you'd kind of consider to be consumer discretionary items or home items, so home furnishings, automobiles ranked pretty high. Interesting. Or sorry, this was— so this is last year. So online, I think, yeah, it was still pretty much You know, automobiles, obviously most people are going to a dealer to buy a car, so it was only 9% versus 64% who want to go to the dealership. But still, the biggest ticket item that we saw was travel, and that was 64% of people would be willing to buy online.

Bye-bye travel agents, right? Poor things.

Well, that was the one interesting thing. We did talk to some travel agents from a qualitative standpoint, and I think when you, as Michael was talking about, when you think about travel and you think about, okay, well, I need to book a flight, that's just one level, that's just one type of trip. If you're going on a bike trip through Napa or Europe, there's a whole You know, there's a long list of things that you're going to need help with in terms of border crossings, hotels, different languages, bike rentals, whatever. I mean, you know, hospitals if things go wrong. And it's nice to have, you know, somebody to help you out with those things. So having someone that can provide that online service but that can be there for you when you need them, you know, I think that's really important to think about.

You know, I think a lot of this comes down to common sense as well, to be honest. I mean, travel So, you know, do I— how do I experience the product? Travel, you only experience the product when you actually go on the vacation. So how do I do my research for travel? Well, you know, it's other people's ratings, it's the advice of the travel agent, it's videos, it's photographs, all of which you can do extremely well online with the right communication mechanisms in place. Clothes is very different. How do I experience clothes? Well, they're there in the store and they're personal to me. I may want tailoring. I think, you know, you've not got to forget in all of this common sense and how— and the products people are buying and how they experience them. So I think a lot of it is commoditization of the product that you're buying. So electronics, you pretty much know what you're getting, so you can buy it online. Travel, it's all about the information that you consume and building the best picture of the experience that you're going to get. Study to one side, in the organizations that we deal with, just to answer the question very specifically, I mean, automobiles. We have customers who've sold extremely high-end automobiles online without ever meeting the person. Because again, it's a product that when you're in the market for a $250,000 Bentley, you know exactly the product that you're buying. Mm-hmm. It may be your 3rd or 4th Bentley. You've seen all the reviews online. You know that you want it. You just know what color you want it in. So a lot of these people can do that online. But even real estate, we've had some organizations who've sold real estate online. I don't think that's the typical model, but I think it really depends on the appetite of the consumer. But I think really it's about how do you experience the product that you're buying, and some products lend themselves to digital experiences, some don't.

So I like that a lot, and following up to this, actually Lynn Linda Bate Johnson said she'd love to see a follow-up report. Business owners, how have you gotten off track and how can you refocus business development? So kind of related to this, how would you suggest that a business readjust? Where should the marketing spend go, especially based on this, on kind of what the direction, what you just said in terms of the difference there?

I would say there's no standard answer. That's a good answer. That's a little bit of a cop-out, but you've got to let the data talk for itself. You've got to understand your audience, where you are right now, and where you want to go. So is your current audience base skewed more towards boomers than millennials? If it is, and if you've got enough growth in that mix, then you probably want to skew more towards offline than than online. If your current mix is skewed towards boomers, but you see the massive growth potential in millennials, then you've got to have a plan that transitions over time, that puts you in maintenance mode almost with your boomer generation and starts to shift the marketing mix so that you're nurturing and building, maybe with a different set of products. Buccellati is a great experience. They actually introduced a new range of products to bring into the millennial generation that nurtured them sort of up the value chain, so that when they were in the boomer generation, they did have the the discretionary wealth, they were ready to buy the high-end pieces. And you see that with the automotive companies. They introduced low-end products and moved people slowly up the chain. So I think it's really a case of understanding what your current demographic mix is, where you see the growth coming in future, and having a plan to get the balance right over time. What you don't want though is to go and look at the data and see that you're spending a massive amount in Google AdWords and social media, and then your data tells you that the The biggest amount of your repeat spending and lifetime value is coming from a generation that really isn't engaging on those channels. The customers we find do that are the customers that really aren't looking at the data. They're blindly spending on marketing campaigns because it's what someone told them to do, without actually looking at what their customers are doing on a day-to-day basis.

Bryan, what are your thoughts on this?

No, I think— That's not Bryan.

There, Bryan.

I was like, if I answer, you may not like my answer. No,

no, no, we've heard enough.

And by the way, just to jump in real quickly, there is a debate going on over why the Terrible Towel is up there. They do want to know. And then Carol actually pointed out a different team that she thought should be up there, and there's a little running debate over which flag should be up on your wall. Some people agree and some don't, so I just thought I'd jump in with a little fun there just to mention that.

How about this? We're gonna make people stay till the very end of the chat.

There you go.

I'll tell you why. I have the closing question. Alright, so stay tuned.

No dropping off. I'm intrigued to find out which flag they think should be up there.

Alright, alright. So we'll hear from you, Bryan, then I have one last question, then we'll jump into the terrible towel. So Bryan, tell me, so we were talking We were talking specifically about business owners, how they could, you know, how would you suggest maybe businesses readjust, where should the marketing spend go, and Michael said it really depends. What are your thoughts?

Are you throwing that to me or to Kramer?

I'm throwing it to you.

I'd love to hear Bryan's thoughts on this one before I opine.

I think whatever you have to say is probably right.

Oh my, oh my. Maybe I'll move on to my next one. Sure.

I think it's all about continuing to look at the data and see what it's telling you. Again, if your audience is shifting generationally, if you're changing your business model, which a lot of companies are doing right now because of generational shifts or because of competition in the marketplace, I think you always have to be just looking at what's out there. There's a lot of channels to fill, quite frankly, more and more each year. Some have more buzz around them than ROI. So I think it's all about testing and continuing to work on things and see what's best for you.

Completely agree. Completely agree. So here, we'll stick with you for a second. I have a great follow-up, and we'll end on this, from Catherine. So she says, what tools, techniques, and/or tests do you suggest implementing to help guide who your true target audience is?

Well, thank you.

Okay.

Yeah, let me throw that to Michael.

All right, Michael. What data points are we looking at? So say you are talking to a nonprofit, this is something Bryan Moran also said, are nonprofits savvy enough to know which data points are critical. So how do we figure out which data points here? What are people looking for?

Can I answer that real quickly? Go for it. So I'll answer it with a really interesting story. So when I joined Wealth Engine 20 months ago now, I never really had that much exposure to the nonprofit space. So in answer to the question, are they sophisticated enough, it actually blew me away how sophisticated nonprofits are in terms of their data analytics. So they actually have and have had for some time, most of them, even some of the smallest ones, this notion of a prospect researcher,

right?

Hmm. How many commercial organizations 15 years ago do you know that actually invested time in buying data and doing analytics to understand the prospects that they reach out to? Nonprofits have done that by necessity, because even though they don't say they focus on return on investment, they are 100% focused on return on investment because they want to make sure that the maximum amount of the money they raise gets through to their end cause. It's return on investment. So they only want to talk to people that they know have got the ability to give them what they're asking for.

Right.

So it blew me away that these organizations have this level of sophistication at the top of the funnel, that they're actually investing money in understanding the prospects that they reach out to. Now, where they're not sophisticated is necessarily on the follow-on to that, is how do they then go and do the outreach? So they have— they do very well in the, in the boomer plus generation because a lot of their outreach is direct mail. It's very in-person. It's lunches. It's nurturing face-to-face over time. It's very much personal outreach for them. And a lot of them are struggling. How do they scale that over time? How do they scale that now into a digital market where it's just as competitive on the nonprofit side as it is on the for-profit side in terms of competition for each dollar? So the challenge they're facing is getting more sophisticated on the marketing outreach side, not the analytics side. I would argue that most commercial marketers are actually relatively unsophisticated in that top of the funnel analytics. Most of them are just filling the funnel full of individuals and then learning about those individuals once they've engaged them. It's why tools like Marketo and marketing automation and CRM have taken off so strongly because you need a way of managing that mass volume of prospects because you're bringing so many of them in. And a lot of the data points these organizations are looking at are just, once I've engaged you, how are you interacting with me? What's your behavior? Or once you're a customer, you know, what are your patterns? They're not really investing in that top of the funnel. Who should I be reaching out to and what are their interests, lifestyle, and propensity to spend on my product?

Hmm. I like ending on that. Unless, Bryan, you have anything to add? I feel like we're good.

Yeah, I mean, I feel like there, you know, you have to get your strategies right. You know, everybody's seen the Loom Escapes out there in terms of tools and tricks that you can use. I think unless you've got, you know, an idea of what you're trying to do first, you're going to have a hard road ahead just picking out tools and shooting from the hip.

Yep, integrate tools in your overall strategy. I love it. That's one thing we talk about every week. It's always fun to see how it all Integrates together. And now, drum roll please, if we could get some sound effects here. We want to hear about The Terrible Towel.

I'm actually from Pittsburgh. I just put on an English accent because it gives me way better results in business.

You can

tell from that joke that I'm English. My wife's actually born and bred in Pittsburgh. I married my wife 2 years ago and I'm a Pittsburgh Pittsburgh. I'm a Steelers fan by marriage. So it's something I had to inherit.

Gotcha. Gotcha.

So what did people want to see up there?

Yeah, I didn't see the back and forth.

Oh. Bryan, what did people expect to see?

Yeah. Let's see.

The London Rams or something?

I asked again. And you know what? I'm going to have to go back down into Twitter because it happened so long ago.

I'm in DC, so I'm surrounded by Redskins fans.

Yeah, we need to have a Patriots champ flag. So I think we have a Patriots fan in there, so we have some back and forth there. I'm sure we could add other teams as well. We had a panel a few months ago where we were wearing different hats. We had all of our different teams' hats on there, so that was fun. We should have added towels to this one, but anyway, it's been absolutely a pleasure. BK, I'll hand it to you.

Yeah, no, this is great. Thank you, Michael. I really appreciate you being on here and telling us about both Wealth Engine and the report. And Bryan, your research and everything that you had to contribute on that and here is really appreciated. So unless there are any final words from either of you, we will go ahead and close this out.

Thanks for having us, Bryan. Thanks, Suzie.

It's been a pleasure.

Yeah, well great. Enjoy, guys, really appreciate it. Thank you again, Wealth Engine, really appreciate everything that you guys had to offer here on the HHChat. Bryan Moran just yelled out Jets, so I just wanted to make sure that we threw that in there. Courtney Smith I'm from Manchester, I

just didn't grow up playing soccer, I grew up playing rugby. Anyone from the UK knows it's either soccer or rugby, so I was a rugby family.

JS Gilbert just said, I can't believe this hour flew by. Catherine, thanks for speaking up on my question. Lynn Abate Johnson, again, thank you. So we have a lot of A lot of great people here. Thank you all for joining us. Christy, let's see, JS I said, Patricia, Morgan, Carol, Kathleen, Chris, your own Jessica Smith.

Jim Carter, one of our UK contingent. Shout out to Jim.

And Neil Milliken. Anyway, I could keep going. The community, thank you. Thank you very much for being here again for another HTH Chat. Suzy, cheers to you, and we will see you all next week on Monday in our own time zones, probably, maybe, who knows. And we'll see you soon. Thank you everybody for being here. Cheers.

Thanks everyone.

Thanks a lot, guys. Bye-bye. Make it a good week.