7 Luxury Trends That Will Shape 2022

 

1- Second Hand Luxury Becomes First-Class Priority

The global second-hand market is estimated to reach $77 billion in 2025, with growth rates outpacing the wider luxury market. Resale (thanks to its more curated assortments) is driving the growth and is expected to grow 11 times faster than ordinary clothing retail.

Resale is heating up in luxury. The very essence (timelessness, enduring desirability, durability, and in some cases, scarcity) of luxury goods makes it particularly well-suited and promising for the resale market.

The luxury resale industry is tapping into an expanding demand from affluent consumers for a more circular economy and more conscious consumerism on one side and expanding supply (enlarging competitive arena with more online resale platforms facilitating how pre-owned products can be bought and sold) on the other.

The generational shift in luxury consumers continue to fuel and shape the resale market as Millennials and Gen Z consumers see resale as 1) a convenient, sustainable replacement for fast fashion 2) an opportunity to acquire luxury goods at more affordable prices 3) a means to feed their interest in vintage styles and 4) a new form of investment (luxury resale value).

With fast growth comes the market’s natural inclination for consolidation and scale. So, we can expect to see more acquisitions, new partnership models and innovative technology solutions crystallize (i.e Rise of resale-as-a-service companies) and empower new players’ entry into the lucrative pre-owned market.

But, with resale on the rise, product authenticity and traceability will be especially critical for luxury brands. Investments in blockchain technology, in particular, is an interesting approach to improve the authentication process from the moment a new product is sold to ensure greater traceability and transparency, track a product’s sustainable credentials and tackle counterfeiting (thanks to digital ‘product passports’), ultimately boosting consumer trust. However, common standards remain to be developed collaboratively for this new technology to be truly effective at scale.

What’s clear is: the relationship between luxury’s primary and secondary markets is set to grow deeper in 2022. The only question is: how deep.

 

2- NFTs to the Moon

Non-fungible tokens, or NFTs, were one of the most popular buzzwords of 2021. So much so that the term was chosen to be the “Word of the Year” by Collins Dictionary. Interestingly, metaverse and crypto were also on the shortlist, demonstrating the growing interest in this space.

Analysts at Morgan Stanley expect the luxury NFT and metaverse market to reach $56 billion by 2030. In 2022, luxury brands will continue to experiment with NFT collections, either to sell alongside physical goods, or as standalone digital collectible assets.

From the consumers’ perspective, generating profits with NFT is still currently reserved for a small portion of participants. A study by Chainalysis found indeed that buyers who can mint or be whitelisted to buy newly minted NFTs first will make a profit 75.7% of the time, while users who buy NFTs later on only make a profit 20.8% of the time. As a result, it’s nearly impossible for late comers to make a profit with NFTs if they aren’t part of the very first sale.

This is an opportunity for luxury brands to offer exclusive access to upcoming NFTs for selected customers. Linking physical products with NFTs, for example, is a great way to offer long term value for customers.

3- Worlds of Creativity at Play

At the crossroads of digital, gaming, AR, and VR, the metaverse―a portmanteau of the words meta (meaning beyond) and universe―represents another significant opportunity for luxury brands.

In 2022, we expect luxury brands to launch dedicated virtual experiences to enhance their customers’ experience both online and offline. Online, this will mostly happen through the brands’ own websites and one-off VR experiences. Offline, we expect augmented reality experiences to delight customers in-store and post-purchase, adding a virtual layer to a handbag or a pair of sneakers, for example.

For the metaverse to broaden its appeal, we’ll need significant technological improvements, particularly with AR and VR headsets. Gucci and Balenciaga already filed trademarks for smart glasses and connected clothes. We think 2022 will see the first releases of such products. They won’t be perfect, but they will capture the affluent consumers’ attention as more of our lives takes place online.

Investment bank Morgan Stanley estimates that the metaverse and NFTs will make up 10% of the entire luxury goods market by 2030, representing a $56 billion revenue opportunity, of which $10 billion to $20 billion will come from an entirely newly addressable digital market.

The bank thinks that brands that focus on soft luxury such as ready-to-wear, small leather goods and shoes, are particularly well-positioned to benefit from the metaverse as affluent consumers’ demand for digital fashion grows.

 

4- Social Commerce Goes Live, Globally

In 2021, TikTok (one of the very few apps to surpass 3 billion downloads globally) announced TikTok Shop in partnership with Shopify, allowing for products to be tagged in TikTok videos.

In testing phases in the UK and USA, the native shop will be further rolled out to other markets in 2022.

Social commerce—from in-app checkouts on social media to live stream sales—is set to continue to grow as the digital space become that much more shoppable (with improved platform functionalities for a more seamless shopping experience from discovery to checkout) and consumers are increasingly seeking entertainment and engagement in their shopping experience.

Already popular in Asia for some time, live shopping will grow in popularity in 2022 across the world. See our story on how luxury brands use WeChat to engage with affluent consumers in China to learn more.

 

5- Towards a More Holistic Approach to Values

Being more inclusive and more sustainable will be non-negotiable for luxury brands to remain relevant and win over younger cohorts. Some 43% of Gen-Z fashion consumers actively seek out companies with a solid sustainability reputation.

After years of talking about sustainability, consumers are increasingly paying attention to what brands are really doing. Greenwashing isn’t enough in 2022. On the contrary, brands accused of greenwashing risk being publicly shamed and see sales declining, together with their market capitalization.

It’s likely that the crisis will mark a turning point for luxury as we knew it – luxury brands will continue to redefine themselves, expanding their mission beyond creativity and excellence, becoming enablers of social and cultural change.

Consumers are increasingly demanding more transparency around the societal and environmental impacts of their purchases. In 2022, we could reasonably expect to see more luxury brands looking more seriously into tech innovations such as digital product passports to store and share a product’s sustainability credentials (i.e materials, origins, manufacturing process, etc.)—offering the opportunity for customers to buy in accordance with their personal values. But beyond carbon footprint, though, it will be asked of luxury brands to be holistic in their commitment to sustainability, from water waste to human rights.

We will also continue to see innovations in sustainable materials as more customers demand ethically sourced and environmentally responsible materials. (Kering Group, for example, has officially announced it would go fur-free across its entire brand portfolio in 2022.)

However, there is another debate that has been on the agenda for years and still remains very much unsettled: real versus faux-leather. With leather goods being considered a luxury statement—a sign of quality and durability in luxury goods for so long—it will be interesting to see if luxury brands will take a firm stand.

In any case, luxury brands will need to rethink their business models, product strategies and the lifecycle value of their customers in order to reflect the yet to be fully defined reality.

However, we feel it is also important to highlight a contrasted reality. Surprisingly, while we hear about a growing interest in sustainability especially amongst younger generations, we surprisingly also see fast growing companies built around the fast-fashion model à la Zara (but cheaper and faster) skyrocketing. Case in point: Chinese retailer SheIn has grown at speed by leveraging data, automation, and artificial intelligence to deliver on-trend clothes at low prices. SheIn was the largest fast-fashion retailer in the US at the end of 2021 with 28% market share, ahead of Zara (20%) and H&M (11%).

 

6- Domestic Luxuries to Journey Away From the Global Sea of Sameness

With international tourism not expected to fully recover for another year or so, we will continue to witness growing interest and preference of affluent consumers for locally-made products and local shopping destinations in 2022. Shoppers want to support their local economy and focus on proximity e-commerce channels for luxury brands.

This focus comes hand in hand with the increased understanding of the environmental cost of global shipping and manufacturing. Luxury brands who can capitalize on this local sensibility and engage more deeply with domestic consumers will be better positioned to grow.

In 2022, we can expect to see enhanced localization strategies (from product offering to communication) from luxury brands to better adapt to local tastes and cultures in order to be locally relevant.

The heightened sense of supporting local businesses, coupled with the new prime position of online channels, will also give the opportunity for local names and digitally-savvy luxury DTC brands (the likes of Senreve, Oliver Cabell or Anine Bing) to assert their place in the market in the year ahead.

 

7- Data-Driven Digital Experiences as a Competitive Advantage

Experiential luxury (including hospitality, jets, yachts and cruises) was a main focus for years as young affluent generations were said to be more interested in experiences rather than buying luxury products. Then 2019 happened.

And if we have been talking about the experiential transformation of luxury goods for some time. Now, it is more important than ever.

Experiences will continue to play an increasingly important role in consumers’ purchase decisions.

In 2022, brands will need to embrace digital experiences as an added layer to their products to engage their customers as in-person events and boutique experiences will remain constrained. This provides an opportunity for luxury brands willing to fully embrace the digital realm and meet their consumers where they are—online.

Digitization will also continue to drive an increasing amount of data, which means both consumers and businesses will increasingly seek a single source of truth and use data for betterment.

In 2022, affluent consumers will continue to ask luxury brands to demonstrate meaningful benefits of data sharing-expecting personalized perks in exchange for giving up some level of privacy. No matter the digital channel, luxury brands will be expected to offer first-class online experiences that feel truly bespoke to affluent consumers, from personal shoppers to private viewings, personalized treatments, targeted recommendations, and recognition across all channels.

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3 Macro Shifts: The Future of Luxury

There are three underlying themes that are fundamentally reshaping the global dynamics and the business playbook for luxury brands

1- Online will soon surpass all other luxury sales channels

Global lockdowns in 2020 and 2021 were the perfect stepping stones for online luxury sales channels to prove their worth. Early digital adopters saw exponential growth, while latecomers were forced to rapidly adapt and (finally) embrace digital. The share of online sales nearly doubled for personal luxury goods, growing from 12% in 2019 to 22% in 2021, reaching $70.1 billion.

In 2022, online luxury sales will continue to outpace most other channels across all industries. Even the luxury car category will see online sales growth. It’s now not a question of if but when will online sales surpass all the other luxury sales channels to drive the most revenue for the industry.

Global consultancy group Bain & Company forecasts that online sales will indeed become the single biggest channel for personal luxury goods by 2025, making up 30% of the global market, followed by monobrand physical retail stores (28%), outlet stores (14%), specialty stores (11%), department stores (11%), and travel retail (6%).

Websites and mobile apps are indeed the new dominant sales channels for most brands. Considerable work has been done to improve user experience online and build trust by reassuring customers that returns and exchanges can be done seamlessly.

Interestingly, we also see brands increasingly driving sales through their own websites. Gucci, for example, is increasingly empowering customers to purchase goods from their directly operated stores, with a focus on ecommerce, instead of relying too heavily on online multibrand retailers like FARFETCH and NET-A-PORTER, reflecting the luxury House’s strategy of gradually enhancing the exclusivity of its distribution network.

Luxury brands’ direct online sales now account for 40% of the online segment, compared to 30% in 2019, driven by improvements in ecommerce, exclusive collections, and more marketing budget allocated to the category.

The online channel growth also shows how important the younger customer demographic has become for the global luxury industry. Gen Z and Millennials are indeed the industry’s growth engine.

2- Millennials and Gen Z Drive Luxury Growth at Accelerating Rates

Without a doubt, Millennials (Gen Y) and Gen Z customers will continue to assert their position as critical growth levers for the luxury sector in 2022. And this generational shift will only accelerate in the coming years.

Together, these younger generations of affluent consumers are set to account for 70% of the luxury market by 2025 and contribute 130% of luxury market growth. Yet, they are still underserved by many luxury brands.

Collaborations such as Gucci x Balenciaga, Fendi x Versace, and Tiffany x Supreme are testaments to some level of realisation of the importance of these younger cohorts by legacy luxury brands and proof that brand collaborations haven’t reached oversaturation yet.

As the largest segment of luxury buyers, these next-gen affluent consumers are already rewriting the luxury rulebook with their value-driven expectations and digital-infused lifestyles.

To grow, luxury brands must understand how to relate to and win over these younger generations. It’s not just a question of pivoting at speed in an ever-evolving market but also a capacity to shift their business mindset.

Indeed, these younger cohorts are digital natives and both creators (they want to co-create with brands) and critics: they love to seamlessly engage with online content and are expecting luxury brands to operate at their high standard.

With a vested interest in giving back and being among the most vocal and socially active consumers, younger generations (Gen Zers perhaps even more so than Millennials) also value authenticity and integrity from brands. Sustainability, in particular, cannot be an afterthought; it must be honest, transparent and backed by action.

Thus, for luxury brands to remain in sync with younger global luxury consumers, they need to communicate their stances on environmental, ethical and social issues and most importantly deliver on these goals.

3- The $725 Billion question: What Will China Do?

Chinese affluent consumers will come back to driving the majority of worldwide luxury sales between 2022 and 2023, but things might be about to change.

In 2020 and 2021, we saw for the first time domestic luxury sales in China surpassing international sales due to travel restrictions. Domestic sales accounted for 21% of global sales in 2021 versus just 11% in 2019. In parallel, we also saw US domestic sales surpassing Chinese domestic sales, growing from 22% in 2019 to 31% of worldwide sales in 2021.

Bain expects Chinese consumers to surpass their previous share of global luxury goods sales to reach 40% to 45% by 2025. Based on our projections, that would represent $725 billion worth of sales being driven by Chinese consumers, out of a total market of $1.69 trillion.

The consultancy group predicts that the growing middle-class desire to purchase luxury goods will be sufficient to drive that growth. We think the market is facing significant headwinds, however. Particularly with China’s political focus on “Common Prosperity” goals and the resulting pressure exercised on affluent consumers to minimize external signs of wealth.

Add to the political changes the growing desire by Chinese consumers to buy from local brands and you have a challenging scenario for global luxury brands that rely too heavily on China to generate sales. The rebound in the US and European sales offer a hint of optimism for a more balanced outlook on worldwide sales between the three regions, however.

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Superyacht Building Boom Creates a Supply Crunch and Crew Shortage for Ultrarich Buyers

More than 1,000 superyachts are now in production or on order, as the global ultrarich seek refuge from crowds and Covid-19 on their nine-figure floating palaces.

According to Boat International’s 2022 Global Order Book, a record 1,024 superyachts — defined as yachts longer than 80 feet — are in construction or on order, up 25% over the year-earlier period, surpassing a 2008 peak. With shipyards straining to keep up with demand, wealthy buyers are being told they have to wait three to five years for custom orders.

“The shipyards are very full,” said Jonathan Beckett, CEO of Burgess, a yacht brokerage and management firm. “They are doing their best to satisfy customer requirements, but it’s not easy.”

From Jeff Bezos’ new 416-foot sailing yacht to Project Black Shark, a mysterious 252-foot yacht designed with a “shark-like skin,” the sheer number and size of vessels under construction is unprecedented, according to industry executives. The total length of superyachts scheduled to be delivered by 2026 would stretch more than 24 miles, according to Boat International.

Superyachts can cost anywhere from $2 million to $3 million to more than $500 million depending on their size and complexity.

Most of the demand is coming from the U.S., where soaring stock markets, IPOs, SPAC deals and crypto gains have created trillions of dollars of wealth during the pandemic, Beckett said. The U.S. has 500 more billionaires now than it did before the pandemic, ending the year with around 2,755, according to Forbes.

Many of the new and existing ultrarich accelerated their plans to buy a superyacht over the past two years amid growing concerns about public health, Beckett said.

Workers pass up materials as they install scaffolding around a superyacht at the MB92 Group shipyard in Barcelona, Spain, on Wednesday, Nov. 17, 2021.

Workers pass up materials as they install scaffolding around a superyacht at the MB92 Group shipyard in Barcelona, Spain, on Wednesday, Nov. 17, 2021.

“Covid made people sit up and reevaluate their lives,” Beckett said. “A lot of our clients felt impenetrable and secure, and I think Covid made them feel vulnerable. So they said, ‘Why put off for another five or 10 years buying a yacht and enjoying myself with my family, when I could be doing it today?’ ”

The rush has created shortages of crew, dock space and shipyards. Yacht builders around the world — but mainly in Italy, the Netherlands and Germany — are struggling with labor and material shortages, and space constraints.

According to Boat International, superyacht inventory is sold for 2022, most of it for 2023 and “2024 is already being eyed on the semi-custom front.” The number of boats started without owners — or “on spec” — is now the lowest on record.

While prices in the superyacht industry are highly variable and opaque, demand is pushing prices higher, Beckett said.

“Prices for new ‘builds’ are going up,” he said. “It’s difficult for shipyards to quote a fixed price, since the cost of materials may escalate over the next 12 to 24 months, but at the end of the day everyone wants a fixed-price contract.”

Today’s state-of-the-art superyachts have typical amenities like pools, helipads, Jet Ski garages and gyms, but some include the sought-after “beach club” — a massive leisure space at the stern that has retractable balconies, lounge decks, spas and dining areas that offer easy access to and from the water.

The largest motor superyacht to be delivered this year was the 464-foot ″Nord,” built by Germany’s Lurssen Yachts. It has a retractable helicopter hangar, a sports and diving center, 14 custom tenders (the boats used to go to and from the vessel) and a submarine.

A growing number of buyers are ordering “expedition” superyachts, which are sturdy, military-like explorers that can sail through ice, storms and harsh conditions to explore remote corners of the world. Orders for them jumped 33% this year, according to Boat International.

Beckett said that buyers of these types of superyachts value them in the same way they do adventure vehicles like Land Rovers and the Mercedes-AMG G 63 SUV.

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Millennials’ Aspirations Drive Modern Luxury Watch Growth

 

High-end mechanical watch sales continue to grown, driven by strong demand in Asia and from affluent Millennials. Millennials seek simplicity, personalisation and transparency when buying a high-end mechanical watch. Traditional luxury watch manufacturers need to focus on vintage-inspired design and on developing their digital sales and marketing capabilities.

Luxury analog watches are making a comeback. Paving the way for the high-end mechanical watch resurrection are none other than the Millennials. However, luxury timepiece manufacturers need to be aware that the younger generation of watch buyers are not on the market for “old school luxury”. Instead, affluent Millennials seek simplicity, personalisation and transparency when choosing their luxury timepiece.

As a result, high-end mechanical watch manufacturers are focusing on new product launches and developing digital sales and marketing channels to grow. Vintage-inspired designs and online collaborations with influencers and bloggers are particularly important.

High-end mechanical watches are as relevant today as they were before. However, luxury watch marketers need to be aware of the generational shift towards modern luxury. This article explores the definition of modern luxury, with a particular focus on the meaning of the word for Millennial consumers, and how prestigious analog watch brands can leverage digital to appeal to a new and savvy generation of modern luxury consumers.

Millennials Still Favour High-End Mechanical Watches as a Luxury Purchase

A recent survey from Deloitte found that Millennials remain highly attracted to high-end Swiss watch brands. The research shows that Millennials would indeed favour an analog luxury timepiece over a digital smartwatch if given CHF 5,000 (USD $5,135) to spend on a gift watch

A significant majority of Millennials surveyed in China, the UK and Italy would choose a luxury mechanical watch over the latest release of a smartwatch, every year, for the next ten years.

The respondents in the United States were a notable exception, however. An almost equal proportion of Millennials in the US would choose a smartwatch versus a mechanical watch.

Millennials in Asia Drive Global Luxury Watch Sales Growth

The latest data released by the Federation of the Swiss Watch Industry (FH) shows that global luxury watch sales continue to be driven mostly by younger consumers in Asia. Hong Kong (fueled by Mainland Chinese tourists) and China are driving respectively 35.7 per cent and 21.7 per cent of the yearly growth.

The United States, the second largest market for luxury Swiss watches after Hong Kong, also benefited from a strong 26.3 per cent growth but remains 6.6 per cent below the 2016 sales levels. The same goes for most of the other markets in the top 10 listing.

It’s important to note, however, that while we’re seeing growth nearly everywhere (with the exception of the UK and Italy), the sales of high-end watches haven’t reached the pre-crisis performances of 2016. Aside from Hong Kong and China, Singapore is the only other country that enjoys a modest 4.7 per cent two-year growth. And here again, it’s mostly the overseas Chinese tourists that are driving Singapore’s growth.

So while the luxury watch industry is optimistic for the future, total sales haven’t fully recovered to their pre-crisis levels yet. The impact of the anti-corruption campaign in China can arguably still be felt through the industry.

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Private Jet Rage Grows as a Record Number of Fliers Strain the System, Causing Plane Shortages

Private jet fliers are facing increasing delays, cancellations and lack of available flights as the industry struggles to serve a record number of new fliers, while facing supply chain troubles.

July was the busiest month ever for private jet flights, with more than 300,000 flights, according to Argus International. While business usually cools in the fall, September saw nearly 300,000 flights and Argus projects October’s pace will break the July record.

The flood of new private jet customers — driven by health concerns during the coronavirus pandemic and the rapid creation of wealth — is now taxing an industry geared for slower growth. A shortage of new and used planes, delays getting aircraft parts, crew and pilot shortages, catering snafus, and air traffic problems are combining to create a growing number of delays and cancellations, according to industry executives.

Customers who paid five or six figures for their dream flights are now learning that even private jets encounter delays and logistics problems.

“These are people who spent $200,000 and they want perfection,” said Doug Gollan, founder of Private Jet Card Comparisons, a website that reviews jet card programs.

A Private Jet Card Comparisons survey of private jet fliers found that more than 20% had experienced a service issue in recent months.

Shortages ripple through the system

Industry executives say the main issue is a lack of aircraft. People who own private jets and usually hire them out for charter are using the planes more often themselves, leaving fewer available for the charter market.

Fractional owners are also using their planes more. The supply shortage is feeding through the entire private aviation system, from charter companies and jet management companies to brokers and operators. The inventory of used planes is at all-time lows, and private jet makers Bombardier, Textron and General Dynamics’ Gulfstream have all raised production to meet demand.

Pilots are in short supply as well. Many retired or dialed back during the Covid-19 pandemic, and with the commercial airlines aggressively hiring, private jet companies and owners are scrambling to find pilots. Finding cabin crew is also becoming difficult and costly.

Shortages and delays are also hurting the availability of aircraft parts, which means that repairs that should take a day or two are now stretching for a week or more, taking more planes out of circulation.

Wheels Up, which started trading as a public company this summer, just launched a new Pilot Employee Equity Grant to try to lure and retain more pilots. The program provides equity to full-time and part-time pilots on its seniority list as of Aug. 31, and new pilots hired after Sept. 1 will be eligible.

Even catering has become a source of customer complaints. Private jet customers typically call in their catering order a day or two before the flight. But many of the new fliers are calling it in the night before, which has created a mad scramble for the caterers trying to source and make the meals — and line up the right wine or spirits — that clients are requesting.

“Say you’ve got a client who ordered Belvedere vodka and the caterer couldn’t only get Grey Goose,” Gollan said. “So the customer gets on the plane and he’s ticked off that he’s paying all this money and saying “why didn’t I get my Belvedere vodka?’”

Turning away new business

The cascade of problems has led some companies to halt sales and new customers. Sentient Jet just stopped sales of jet cards as of midnight on Sept. 30, saying it wants to focus on its existing customers.

NetJets has halted sales of jet cards, fractional shares and leases for light cabin aircraft — like the Citation XLS and Phenom 300. The company said flight demand is the highest in its 57-year history, averaging 500 flights a day compared with under 400 in 2019.

“The vast number of flights is taxing the air travel infrastructure in ways we haven’t seen in years,” the company said. Pausing light jet sales, along with other restrictions on card buyers, “allows the company to continue prioritizing what is most important — delivering the best possible experience to all owners.”

Concerns about rising costs and lower margins are squeezing some private jet operators and companies. Wheels Up’s share price has fallen by more than 40% since its peak in July, in part because of analyst concerns over margins.

Wheels Up said it “is uniquely positioned to service our members and customers in the current environment with our fleet of owned, operated, managed and third-party partner aircraft.”

The big question is whether the more than 10,000 customers who started flying private for the first time during the pandemic will stick around if the problems continue to mount. Gollan said that while customers may complain about service issues, none of the 300 it surveyed said they planned to go back to commercial airlines. 

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Millennial Millionaires Have a Large Share of Their Wealth in Crypto, CNBC Survey Says

Nearly half of millennial millionaires have at least 25% of their wealth in cryptocurrencies, as the crypto boom continues to create wealth for young, early adopters, according to the CNBC Millionaire Survey.

Some 47% of millennial millionaires surveyed have more than 25% of their wealth in cryptocurrencies, according to the survey of 750 investors with at least $1 million in investible assets. More than a third of millennial millionaires have at least half their wealth in crypto.

The results highlight a new generational divide in wealth creation from crypto, with younger investors who spotted the trend early on able to earn vast fortunes and grow their existing investments from the surge in the prices of bitcoin, ether and other digital currencies.

Older millionaires are far less likely to believe in or invest in crypto. Fully 83% of American millionaires have none of their wealth in crypto, and only 1 in 10 keeps more than 10% of their wealth in crypto assets, according to the survey. None of the baby boomer millionaires or older generations has more than 10% of their wealth in crypto.

“The younger investors jumped on it early when it was not as well known,” said George Walper, president of Spectrem Group, which conducted the online Millionaire Survey with CNBC in April and May. “The younger investors were more intellectually engaged with the idea even though it was new. Older investors and the boomers were largely saying ‘Is this legit?’”

The importance of crypto to young millionaires could shift the wealth management industry, as private banks, brokers and wealth management firms scramble to cater to a new, crypto-heavy clientele. In the coming years, the key to attracting the next generation of wealthy clients could be more about crypto than traditional stocks, bonds, private equity and hedge funds.

“We’re already seeing the industry responding,” Walper said. ’We see more and more providers offering access to crypto investing. It’s changing fast.”

The generational divide among millionaires is even more stark when it comes to nonfungible tokens. Most millionaires say they don’t know what an NFT is, and more than a third say they are an “overhyped fad.” Yet two-thirds of millennial millionaires say NFTs “are the next big thing.”

Nearly half of millennial millionaires surveyed own NFTs, and 40% say they don’t currently own an NFT but have “considered” it. That compares with 98% of baby boomer millionaires who say they don’t own any NFTs and aren’t considering it.

“NFTs have only recently started to be part of the media coverage,” Walper said. “So the older generations are further behind on the understanding.”

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NFT Sales Top $2 Billion in First Quarter, With Twice as Many Buyers as Sellers

Sales of digital nonfungible tokens soared to more than $2 billion in the first quarter — more than 20 times the volume of the previous quarter, according to a report from NonFungible.com.

There were $93 million in transactions in the fourth quarter of 2020, according to the website, which tracks NFT transactions and marketplaces.

Its first-quarter total does not include sales of NBA Top Shots — the video highlights that are being turned into NFTs and traded. Those trade on the Flow platform and racked up sales of $472 million in the first quarter, according to NonFungible.com. It also does not include the $69 million NFT sold by Beeple at Christie’s in March, since it was traded through a partnership with Nifty Gateway.

Despite recent data showing a big drop in average prices from February, sales of NFTs at the start of the year showed an explosion of interest and buying. NonFungible.com said there were more than twice as many buyers than sellers in the first quarter, with 73,000 buyers for 33,000 sellers. The imbalance, according to the company, “is a signal of massive interest in newcomers, but also of the desire of current owners to keep their assets, which creates a phenomenon of scarcity in the market.”

A digital artwork featuring Scooter frontman H.P. Baxxter is up for auction on a website. Scooter will be the first band in Germany to release digital, animated artwork to accompany the new Scooter album "God Save the Rave" starting April 9. The artwork w

A digital artwork featuring Scooter frontman H.P. Baxxter is up for auction on a website. Scooter will be the first band in Germany to release digital, animated artwork to accompany the new Scooter album “God Save the Rave” starting April 9. The artwork will receive a certificate of authenticity using NFTs, Non-Fungible Tokens, which cannot be manipulated.

There were nearly 150,000 active wallets in the first quarter — more than 1.5 times the number from a year ago.

NonFungible.com said the industry is largely dominated by the art and collectibles segments, and specifically projects such as CryptoPunks and SuperRare.

Despite the recent price drops from the February highs, NonFungible.com said the average price of NFTs “increased significantly” during the quarter, with a work of art on SuperRare selling for an average of $1,231 in the fourth quarter, and $6,585 in the first quarter on the secondary market.

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Wyzeman Ventures Inc. Acquires Puuritea

 

Wyzeman Ventures, a Toronto-based venture capital firm specializing in luxury businesses, announced it has completed its acquisition of Puuritea, a premier wellness community focused on youthfulness.

“Puuritea is an extraordinary company because it is focused on a product that is treasured by its small core social elite member community which has been growing for over 20 years,” commented Ron Salzberg, an investment insider familiar with the businesses. “This acquisition will help Puuritea transform from a prestigious club to an exclusive powerhouse in the luxury wellness sphere. The full terms and financial settlement were undisclosed, but rumored to be over $35M. An investment like that signifies the value of Puuritea’s products and services, and enables the business to expand its offerings and membership into new territory that is beneficial to everyone.”

“There is a buzz among certain wellness influencers about what this acquisition could mean,” said Claire Johnson, a social media commentator from Manhattan. “Most of us have never heard of it, but the tea that Puuritea makes is often talked about in elite circles. A tea that is claimed to keep people younger and living longer. Who doesn’t want that. Keep in mind that this tea has never been made public before, so the people who know about it are very excited about it becoming available.”

About Puuritea

Puuritea is a community united around the principle of staying young and living long. While the community has been around for over 20 years, it has remained a closed community until its recent acquisition by Wyzeman Ventures. Known best for its closely guarded tea, Puuritea also boasts one of the most prestigious luxury concierge services.

About Wyzeman Ventures

Wyzeman Ventures is a venture capital firm specialized in managing luxury businesses. It was established in 2015 and is responsible for over 25 successful ventures since then.

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China’s Billionaires See Biggest Gains Ever, Adding More Than $1.5 Trillion to Their Fortunes

A spate of IPOs and robust tech growth helped China’s billionaires add $1.5 trillion to their wealth, bringing the total worth of China’s billionaires to $4 trillion, according to a new report, which described the increase as the country’s fastest growth ever.

China minted 257 billionaires over the past year — averaging five new billionaires a week — bringing the total to 878, according to the Hurun Rich List 2020, which tracks wealth in China. That total would exceed the 788 billionaires in the U.S., as measured by Wealth-X. (Wealth-X and others, however, use different methodologies for China and put China’s billionaire count lower than that of the U.S.)

“The world has never seen this much wealth created in just one year,” said Rupert Hoogewerf, Hurun Report chairman and chief researcher. “China’s entrepreneurs have done much better than expected. Despite Covid-19, they have risen to record levels.”

China’s soaring stock markets, a flood of initial public offerings and surging growth in the tech sector have all helped to fuel the country’s latest wealth boom. Jack Ma, co-founder and former executive chairman of Alibaba, topped China’s billionaire ranking for the third year in a row, with $59 billion. He saw his fortune increase 45%, due mainly to the upcoming IPO of fintech giant Ant Group.

“The Hurun China Rich List recorded more wealth created this year than the previous five years combined, suggesting that the structure of the economy has evolved, moving away from traditional sectors like manufacturing and real estate, towards the new economy,” Hoogewerf said.

Just as in the U.S., China’s first two months of the outbreak saw massive wealth destruction, followed by a V-shaped recovery for stock markets and then a massive digital boom, according to Hurun.

Ranking second on the billionaire’s list is Pony Ma, founder, chairman and CEO of tech conglomerate Tencent. His wealth increased 50% to $57.4 billion, driven by Tencent’s strong gaming business and growth in WeChat. Ranking third was Zhong Shanshan, chairman of YST, which makes bottled water.

Other big wealth winners over the past year included China’s “food delivery king” Wang Xing of Meituan- Dianping, who quadrupled his wealth to $25 billion, after winning market share from Alibaba. China’s “express delivery king” Wang Wei of SF Express more than doubled his wealth to $35.3 billion, the report said.

Zhou Qunfei of Lens, the touchscreen maker, saw her fortune more than triple to $17 billion, making her one of the three richest self-made women in the world.

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Amazon makes new upscale move with Luxury

 

Amazon unveiled plans Tuesday for a new online luxury "shopping experience" that will seek to connect well-heeled consumers and high-end brands.

The first partner for the new online "Luxury Stores" is Oscar de la Renta, the US fashion house that will show its 2020 collections, with more brands expected in the coming weeks, according to an Amazon statement.

The move is not Amazon's first foray into luxury goods but seeks to create a new online shopping portal with top brands and upgraded technology offering 360-degree views for shoppers.

Luxury Stores will operate on an invitation-only basis for Amazon Prime members.

Within the Amazon app, the new portal will offer improved graphics and visualization, and allow brands to sell as a "store within a store," controlling their own inventory, selection and pricing

"We are always listening to and learning from our customers, and we are inspired by feedback from Prime members who want the ability to shop their favorite luxury brands in Amazon's store," said Christine Beauchamp, president of Amazon Fashion

“We are excited to offer luxury brands the services and technology to build an inspiring, elevated customer experience."

The move comes with Amazon having boosted online sales in many sectors in recent months during the coronavirus pandemic, which has closed many physical stores and kept consumers cautious about going out to shop.

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