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Retirement Planning > Spending in Retirement > Lifestyle Planning

Luxury Concierges Battle for the Attention of the Very Rich

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With mobile apps that can make you a dinner reservation, find a taxi, a dog walker or even arrange your dry cleaning, who needs a personal assistant—let alone a luxury concierge?

The very, very wealthy. That’s who.

In 2017, personal wealth worldwide reached a record $201.9 trillion, a 12 percent gain from a year earlier, and millionaires and billionaires held almost half of that, according to a June report by Boston Consulting Group. With all that money, the competition among luxury concierge companies for leisure dollars has become more cutthroat than ever.

Instead of meeting simple requests like last-minute helicopter rides to the Hamptons, “lifestyle managers” must be ready to stun with private tours of the Sistine Chapel or balloon rides over Buddhist temples in Myanmar. And for their increasingly younger customers, all must be instantly available via smartphone.

For a few hundred thousand dollars a year, London-based Quintessentially promises all the spontaneity and bragworthy experiences any 1-Percenter could want. Along with its less expensive rival, Velocity Black, the company can still get you that great table at a hot restaurant or a dependable house cleaner. But the real draw is the option for extraordinary adventure, part of the growing, decadent “experience economy.”

Or, as Quintessentially calls it, “bespoke experiences.”

“It’s fun to say, ‘Oh yeah, we had dinner on an iceberg and a cocktail party in the Great Pyramids,’ ” said William Reedy, Quintessentially’s head of U.S. concierge servicing and a former lifestyle manager himself. “It’s not cool just because it was really expensive, but because it was something no one had thought you could do.”

Quintessentially was founded in 2001 as a 24/7/365 concierge service for the embarrassingly wealthy. Today it has 60 offices around the world and thousands of members who pay annual membership fees ranging from $7,500 to six figures. For that kind of money, members want whatever they want when they want it.

“When this company started, the idea was that there will be a magical phone number that could do anything for you,” said Robbie Guevarra, the company’s U.S. marketing manager. “If you knew the number, you were in the club. And if you didn’t, you weren’t.”

Today, your membership comes with not only that phone number but the email address of at least one lifestyle manager in a major city. From there, Guevarra said, “we fulfill anything that’s legal. We basically do anything and everything under the sun.”

The average net worth of a Quintessentially member is $50 million, he said, and the typical member is 35 to 55 years old. But newer members have been even younger. And that means better technology is critical to keeping up.

“When I started, I don’t even think iPhones were around—so there weren’t apps,” Reedy said. “There wasn’t Blade [the helicopter service], so you couldn’t just book a helicopter on your phone. Uber didn’t exist.” (Quintessentially is in the process of developing an app for its members, he said.)

A December 2017 report from McKinsey & Co. found that, over the previous three years, spending on “experiences” including travel had grown almost four times faster than spending on goods. Millennials are driving that shift, according to Sophie Marchessou, an author of the report. “Social media most likely plays a role,” she said. “It has such a focus on showcasing experiences.”

Nevertheless, Marchessou notes that less-digital-savvy baby boomers are also driving the experience economy. Along with Generation X, they tend to be wealthier. Reedy can attest to that.

When Reedy was a  lifestyle manager, he was responsible for coming up with plans and ideas to entertain a 60-something Manhattan millionaire. At the client’s beck and call, Reedy even had to attend events when a companion was needed. The client paid $20,000 a year for the service.

“We found him a dance teacher, singing lessons, and a dialect coach to lose his Long Island accent—[even] a magician and private lessons,” said Reedy, 33. He also recalled working with a 12-year-old piano prodigy once. The boy requested “a lot of birthday cakes,” Reedy said.

The luxury lifestyle concierge industry is made up of a small universe of players. Luxury Attaché and Alberta La Grup, like Quintessentially, are full-service. Others have niche focuses, whether it’s location or industry. Stupak Las Vegas, for example, focuses only on planning corporate and leisure trips to Sin City.

Velocity Black is another do-it-all lifestyle concierge, but it’s audience is younger—with an average age of 34 and a lower net worth, around $7 million. The price of the three-year-old service is much less than Quintessentially, $2,800 a year with a $900 initiation fee. Founder Zia Yusuf, 32, said he’s trying to provide members something that’s usually elusive: spontaneity.

“We don’t just wait for you to tell us what you want,” he said. “We aspire to something greater, which is showing you things you didn’t even know you wanted.” Yusuf also places an emphasis on technology, saying that 40 percent of Velocity Black members open their app every day.

“This isn’t an expensive country club membership that they use once a year,” Yusuf said. “This is something that is embedded in their day-to-day lives.” The company’s revenue has grown about 1,000 percent since it launched, and it expected revenue to reach $12 million for 2018, he said last month.

Among Velocity’s offerings are a culinary tour of Copenhagen, including dinner at Noma, rated one of the world’s best restaurants, and exclusive packages for the Super Bowl and Sundance Film Festival.

As the rich get richer faster, demand for luxury remains strong—but that could be stymied if an economic downturn appears. Still, Reedy and Yusuf are confident that, no matter how bad it gets for everyone else, there will always be people willing to spend on the ultimate luxuries.

“We have a certain kind of client that it doesn’t really affect,” Reedy said. “They can spend $500 or $600 on a hotel room. It’s never going to really change it for them.”

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