The difference between the two is surprisingly distinct. Consider this for a moment. If you fly First Class, you are premium. If you drive a car from the showrooms, you are premium. The same if you wear a watch bought at a shop in a high-end mall. This is because the above three are readily available to every Tom, Dick and Harry with money. They items mentioned above do not really define you. They do not mark you out or give you a sense of sophistry, an aura of elitism or uniqueness. They are just very expensive…but the next guy down the street has the same.
Luxury on the other hand, is in a class of its own, deservedly. The choice items for the consumer of luxury goods will be tailor-made for him. Bespoke is the operative word here. This consumer replace the above with; a Gulfstream private jet, a custom-designed Aston Martin or Rolls Royce, where he gets to choose the color of his exterior and interior, the shade of the wood on the dashboard, the bells and whistles. The watch would be replaced by a timepiece from such eclectic makers like Patek Phillipe, Breitling and Cartier. Some manager at Gucci or at Ferragamo would know his shoes size while another at Brioni would constantly have to update his database about this clients waist and shoulder sizes.
Michael Mwai is the president of The Luxury Network (Kenya), a global franchise that brings together the sellers of luxury brands around the world and creates a platform where they can share client contacts. “The Luxury Network franchise was founded by Kevin Ross and its present in all the luxury capitals of the world. It brings together luxury brands and premium service providers with the view of helping them grow their database of customers. Their customers are very specific; you are looking at the High Net-Worth Individuals (HNWIs) and High Earners Not Rich Yet (HENRYs). We are looking at creating a sustainable market for premium services and luxury goods. We have two responsibilities: to create conversations around luxury so that people can begin to appreciate it more and also to help the luxury brands collaborate through the unique events that we create for them. We invite HNWIs and HENRYs to these events to come and see the product and the service, with the aim of converting them and using them to spread the word to their peers,” he says.
Mwai says that premium is all over while luxury isn’t. Luxury is what rich people dream about. But there is a growing demographic in Kenya that is consuming luxury. Contrary to popular perception, the luxury consumers in Kenya are not the old types in their sixties. Majority of those guys have already made it in life and do not feel the need to splurge. The luxury-chasers in Kenya are, surprisingly, in their 30s, 40. These are the people who want a clear demarcation between them and the hoi polloi-ish middle class. The problem with a burgeoning middle class is that soon everyone starts to look like the other – everybody’s got an Italian suit and a German car parked outside his mansionette in a Nairobi suburb. So the luxury adherent will want his bespoke suits straight from Savile Row, who have been dressing stylish gentlemen since 1938. He might prefer that his shoes be handmade by John Lobb Bootmaker, a company that has been making shoes since 1866. He might want his Porsche fitted with speakers from Bang & Olufsen, Bose, Harman Kardon or whomever he deems to have the best sound on the planet.
If he has affinity to water, he’d have a yacht. His residential abode would not have neighbors a few feet away, and a compound enough to park to cars bumper to bumper. No Sir! This luxury man will have a driveway into his front porch, house with a grand entry and a foyer with crazy chandeliers, marble and best woods for interior décor and the exquisite furniture; a Le Corbusier here and a Boucher over there.
This man (and I will stick to men to avoid making a faux pas on women luxury brands and tastes) will regale you with the fine details in performance between various types of Jaguars and Lamborghinis, Gulfstream and Embraer private jets, over a glass of champagne or well-aged whisky. These guys are beyond wealthy and they have taste…good taste. Do you doubt that they exist in large numbers? Well, there’s an estimated 8,500 dollar millionaires in Kenya, according to the Knight Frank Wealth Report 2016. These are people whose net worth is valued at more than Ksh100 million. (You can imagine there are tens of thousands of Kenyans worth between Ksh5 million to Ksh100 million – the Ksh millionaires). Above the dollar millionaires, there are 340 Kenyans who are worth Ksh1 billion. Then there are 105 Kenyans worth more than Ksh3 billion. At the top are 16 Kenyans worth more than Ksh10 billion. There’s only one Kenyan who is worth Ksh100 billion!
“There are some Kenyans with money that is mindboggling in this country, and they don’t show it. You’ll never know unless you are in those circles. But getting into those circles is not easy. You need to have money to see money at that level, or have a product that allows them to be themselves around you. We are hoping to do that with Luxury Network. If we can create an appreciation for the finer things in life, some of these guys will come out of the woodwork,” says Mwai.
The Luxury Network is the world’s leading business-to-business and business-to-consumer luxury affinity marketing, partnerships and events group. It comprises a private consortium of premium companies in each luxury capital of the world working together at senior director level for mutual business and client development. It exists to create extraordinary, powerful and successful business relationships between many of the world’s most luxurious brands, a synergy that enables members to gain unparalleled access to valuable, pre-qualified and high net worth private clients from around the globe. The Network generates and develops brand awareness and exciting new business development opportunities in ways high-end companies cannot achieve on their own.
The network covers all areas of the top-end markets including: marine, finance, motoring, concierge, health and beauty, wealth management, aviation, property, travel, sports, events, jewelry and watches, entertainment, media, fashion, arts and antiques, hotels and resorts, among others.
Valuable and unique business partnerships are created via brand partnering, joint collaborations, privilege and reward programs, client incentive projects, product launches, roadshows, luxury showcases, media sharing and high profile business-to-business and business-to-consumer networking and sales events.
For nearly all luxury brands, creating a successful affinity marketing program from scratch is a very daunting task and typically requires considerable financial investment, a huge amount of time, pre-qualified director level contacts and a comprehensive activity plan.
when a business signs up with luxury network, all the hard work has already been done for them, providing a direct route to pre-qualified high net worth clients from the start. The Luxury Network has over 350 global members and 22 international offices worldwide, manned by world-class marketing team of industry professionals.
The demographic world over constitutes of people who have a unique view of life and appreciates the finer things. Life is a journey, Mwai says, and one can start anywhere. “You can start by buying yourself a watch, and once your basics are sorted out (car, house, education for kids etc), you can begin looking for a timepiece.”
Mwai wants to change the narrative for Kenyans. He believes that we have the potential not only to consume luxury products and services, but to also export it. He notes that Kenya has very good luxury-grade fashion designers and leather product manufacturers in Kenya which would gain entry in the global luxury circles.
The Kenyan franchise started in November 2015. It has 10 members in Kenya, with 18 luxury brands on board. They have luxury goods, premium services and strategic partners. So far, they have Little Reds products i.e. Brioni, Salvatorre and Stephano Ricci; Apple; English Point Marina; African Platinum offering concierge and limousine services; RMA – Jaguar and Land Rover; Bombardier, private business jet makers who joined from the Dubai Luxury Network; Catell which makes super classy furniture. The strategic partners are Nation Media Group as media partners; Ipsos handling research to figure out the exact size of the market in Africa. Other partners include Goshen Acquisitions who are in land banking and CJW who are bespoke lawyers handling super wealthy clientele.
Luxury goes beyond product, it’s a lifestyle, an experience. Anybody can consume luxury depending on one’s understanding of it. But it is different from premium in the sense that it is not mass-produced. It’s not something you buy off the shelves. Premium is available and mass produced. Luxury is bespoke. For a luxury car, you’d have to make an order and wait for months a opposed to driving away with a rand new car from a showroom.
Mwai says that a lot of people think they have a luxury product while in actual fact they have a premium product. The definition is often blurred by the limited exposure to brands but the affluent consumers are well travelled and they know the difference. Mwai aims at creating awareness to the aspiring consumers, on how to recognize and differentiate between luxury from premium.
The membership for the Luxury Networks is between Ksh750,000 to Ksh1,500,000 per year and Ksh2 million for strategic partnerships. The Network does not admit individual members rather it takes brands only, represented by a company. For example, in Kenya Little Reds is the custodian of Ferragamo, Brioni and Salvatorre. At the events, only prequalified clients attend. Mwai says that naturally, if a client can buy the new Jaguar from RMA, they can certainly afford a Brioni suit. There is also collaborative partnership between members. For example, the Network had an offer where if one bough an apartment at English Point Marina, they’d get five acres from Goshen Acquisitions.
The events are cozy and Mwai pulls all stops to make them memorable. Normally, he gets three different luxury brands to each come with 20 customers. The Network will have its own 20 customers. At the venue, each of the three brands gets exposed to 60 new customers, which they did not have. “These are very qualified leads because they are already consuming luxury products. The cost is split between the members, thereby achieving more traction from their respective marketing budgets.
For Mwai, his most valued asset is the database. He’d guard it at all costs because that is what builds the Network. It is never shared. Even among the members, the database is only shared during the events, for that event.
Mwai, an incredible conversationalist, got exposed to business networking when he set up his design and communications agency, after working for more than 20 years as a graphic designer with Kenya’s mainstream newspapers. At Business Network International (BNI) Kenya chapter where he was one of the founding members, he helped entrepreneurs to architect conversations deliberately, and he realized its something he did well. ‘I learnt the art of listening without judging, in order to learn. Listening to understand with the aim of taking what am hearing and creating an opportunity for the person saying it. But am a trained designer with a passion for cars and a calling for connecting people,” says Mwai, who once run a weekly motoring show, Auto-Vault, on NTV.