Identifying the current state and values of the wealthy
Against a prolonged slowdown of economic growth and concerns about retirement in Japan, a growing number of people are actively engaging in asset management and investment rather than placing excessive expectations on their salary or the person system. Previously, people with financial assets of 100 million yen or more were often defined as “wealthy”, but since around 2022, the term “ultra-wealthy” which goes beyond that is beginning to appear in various media. At the same time, a “growing disparity between the rich and the poor” is also becoming a social issue. While the consumer understanding approach that uses assets and disposable income as its segmentation keys is an often-used analytic methodology, in the midst of the previously mentioned social changes such as the emergence of the ultra-wealthy and growing socioeconomic class disparity, we are entering an era where more detailed analysis and insight in needed than ever before to correctly understand contemporary consumers.
With these issues in mind, we will engage in analysis focusing on the wealthy with financial assets of 100 million yen or more, examine their profiles by looking at their outlook on life, values, consumption consciousness and behavior to search for hints that will inform updated marketing with the wealthy.
According to the Japanese government’s “FY2022 Private Sector Salary Survey”, the number of people who earned 20 million yen or more per year in 2022 was 1.44% of salary earners at approximately 732,000 people, and has increased sizably by 131% (compared to 2017) in the past 5 years. While the state of consumption in society temporarily changed due to the covid crisis, the wealthy are now actively spending as they did in the past in both private life and business, with their consumption activity back again.
In respond to the rise of businesses targeting “the wealthy” currently winning attention, INTAGE conducted a survey on “the wealthy” in April 2024 to identify what sort of people they actually are, and what sorts of products they choose. We would like to introduce some of its results below.
2. Current state of the wealthy
The survey defined the wealthy as a segment that owned 100 million yen or over in financial assets as a household (financial assets: savings and deposits, bonds and stocks such as corporate bonds and government bonds, investment trusts, life insurance with maturity, loans etc.), with the survey conducted by extracting qualifying monitor panelists from INTAGE’s financial panel “Mat-kit”. *For comparison, we extracted a segment with less than 100 million yen in financial assets from INTAGE’s “Mighty Monitor” and surveyed them
These results were obtained from responses from 3012 individuals who own 100 million yen or over in financial assets, and 784 individuals from the general segment. The assets owned by the wealthy broke down as per Fig.1. 914 people (30.3%) had financial assets of 200 million yen or more.
Fig.1
From this point onwards, let’s examine the current state of the wealthy based on the responses from the 3012 people above.
Age composition
Age composition is as per Fig.2, with approximately 60% 60 years old or older. In addition, among those with financial assets of 500 million yen to less than 1 billion yen, 36.9% were in their 50s (the working generation).
Fig.2
Area of residence
Next, let’s examine area of residence. In Japan as a whole, while approximately 30.6% live in the Keihin area (Tokyo, Kanagawa, Saitama, and Chiba), among the wealthy, 51.3% live in the Keihin area. This is approximately 1.7 times higher than the total, indicating they are more concentrated in the Keihin area (Fig.3).
Fig.3
Discretionary funds
On observation of the distribution of discretionary funds (excluding living expenses) available per month, as per Fig.4, 14.8% gave “1 million yen to less than 5 million yen” among those with financial assets of 500 million yen to less than 1 billion yen. They appear to have more leeway in terms of discretionary funds the more financial assets they have. As seen in Fig.4, different trends are observed between those with financial assets of 100 million to under 400 million yen and those with financial assets of 400 million yen or more. Among those with financial assets of 400 million or more, approximately 50% responded their monthly discretionary funds were 250,000 yen or more. At the same time, 27.9% of the wealthy in total responded less than 100,000 yen, indicating even the wealthy do not necessarily have a lot of discretionary funds to spend.
Fig.4
Summary regarding their current state
The following profile of the wealthy became apparent from this survey on the wealthy: ・A quite high approximately 60% were 60 years old or more ・They are concentrated in the Keihin area ・Those with assets of less than 400 million yen in particular do not necessarily have a lot of discretionary funds to spend aside from their living expenses Let’s next explore their thoughts on consumption, outlooks when purchasing products, and values.
3. The wealthy’s outlook on and values regarding product purchase
Outlooks on product purchase
On analyzing outlooks and behavior at product purchase by financial assets, financial assets clear differences in outlook and behavior were apparent between those with assets under 400 million yen and those with assets of 400 million yen or more (Fig.5). As mentioned above, the fact “discretionary funds other than living expense” trends differed between those with assets under 400 million yen and 400 million yen or more may also be related. The three following trends were observed among the ultra-wealthy with financial assets of 400 million yen or more* (Here, those with financial assets of 400 million yen or more are “the ultra-wealthy”) ① Strongly fixated on own axis (Making time for oneself/Improving oneself/Spending money on comfort /feeling pleasant and comfort) ② Wanting to feel superior to others (Choosing brand items/Wanting to wear things others don’t have) ③ Strongly uncompromising (Choosing products with strongly uncompromising tastes/Buying because they identify with the creator’s sentiments/Wanting good things even if they have to spend slightly more on them)
Fig.5
Values
We next checked on differences in values between the wealthy and the general segment using age/gender as axes. We will now explain the differences in values between wealthy and general segment women, where particularly sizable differences occurred this time (Fig.6)
Fig.6
The following characteristics of wealthy women are observed from this data: ① “Interested in contributing to society and volunteering”*Especially prominent among 29~49y.o. ② “Want to take on new challenges one after another” ③ “Am the sort of person who actively expands my interactions with people”*Especially prominent among 29~49y.o. ④ “People around me compliment me on my good taste” *Especially prominent among 29~49y.o. In addition, because of their financial leeway, wealthy women rated 10~15 points higher than general women on “I like to place importance on ethical judgements (ethical consumption)” and “I want to be useful to people and society”. It is thus apparent wealthy women have a broad range on interests to enjoy life with, expand their interactions with people, act actively, and contribute to society.
4. The wealthy’s consumption types
We’ve examined the characteristics of the wealthy by their amount of financial assets and by the age of women to this point. It is also apparent they are interested in many things, have a strong desire to take on challenges, and actively contribute to society. At the same time, taking the growing diversity of consumers and their increased freedom with money and time, and the fact the wealthy are by no means a single uniform entity into consideration, it may be more effective to categorize them into types and paint more detailed target profiles of them for marketing purposes. We thus conducted a cluster analysis based on the results of the current survey using its consumption behavior and values. The results are as seen below, with the wealthy classified into 5 clusters. (Fig.7)
Fig.7
We created the five clusters depicted above, and will now introduce the 3 types of the wealthy that stand out in terms of their purchase/use of high-value products and services.
① “Relatively rich, concerned about how they are seen by others” Account for 21% of the total. A segment concerned by how they are seen by others, want to lead a lifestyle a notch above others, actively exchange with others, and want to be complemented as having good taste by others. ② “Actively rich, strongly uncompromising” Account for 9% of the total. An active segment uncompromising about the products/services they select, strongly conscious of their self-growth and ethical/social contributions, highly curious, and willing to take on challenges. ③ “Private life rich, who value their personal time” Account for 8% of the total. A segment who believes having the bare minimum is sufficient, are not that uncompromising about the products/services they select, are pragmatists who examine things based on functionality, and value their private life including personal time and time spent with family.
In addition to these segments, there are also 23% “Thorough rich, who focus on leisure time” who thoroughly examine whether offers are worth their price when purchasing products/services, and 18% “Secretly rich, who lead quiet lives” who want a stable lifestyle.
The ② “Actively rich, strongly uncompromising” segment greatly value their own time, and are willing to buy time with money. Resultantly, new products and services could be developed to meet the needs of the wealthy that enable them to utilize they time and earn more, such as services that enable them to “improve their skills” or “manage their assets” with the time saved, or a “priority facility reservation concierge” to enjoy one’s leisure time with.
5. The value of the wealthy as “survey targets”
The wealthy have a diverse range of interests and interact with a wide range of people, so tend to be affected by outside influences. They are an active segment interested in ethical consumption and social contribution, and highly receptive to new products and services. They should probably be focused on not only as a marketing target, but as an advanced segment that predicts future consumption trends as well. In addition, with the price increases with many products and services in our daily lives having run their course, some companies are beginning to reconsider their excessive responses to deflation to date. Some companies and brands are attempting to shift to a high-price market by shifting to inherently highly value-added products and services rather than merely passing on the rising cost of raw materials and transportation to customers. The wealthy should be an extremely promising target for these sorts of products and services. We segmented the wealthy into 5 types in this article. How they are segmented will differ depending on the product or service. As we have introduced, it would also be possible to conduct quantitative surveys on the wealthy. We recommend taking a direct approach (research) with the wealthy to increase clarify with the wealthy, and leveraging them as an advanced consumer segment in the development of products and services.
Research Outline Survey Area: Nationwide, Japan Respondent Criteria: 20~79-year-old men and women Sample Extraction Method: Eligible extracted from Mighty Monitor (eligible individuals sampled from Mat-kit data) Sample Size: Wealthy n=3012 General segment n=784 Survey Implementation Period: (Tue) 9 ~ (Mon) 15, April 2024
Author profile
Kentaro Ham
Future Co-creation Center, Sales Promotion Division, Marketing Partner Headquarters 2, INTAGE Inc.
・After graduating from university, Hama worked for a home appliance manufacturer, and was responsible for product planning for word processors, faxes, mobile phones, video communication devices, and solar power generation.
・Joined INTAGE in 2013, and engaged in domestic and overseas consumer research and consulting.
・Established the “Future Co-creation Center” in 2017, where he has conducted a large amount of joint research projects (POC) and consumer research with a focus on creating new value through co-creation with companies.
・Currently interested in the well-being field
Participating in Datability Consortium Organization
「Launched a “Well-being Committee” and is engaged in co-creation activities with different industries.
Future Co-creation Center, Sales Promotion Division, Marketing Partner Headquarters 2, INTAGE Inc.
・After graduating from university, Hama worked for a home appliance manufacturer, and was responsible for product planning for word processors, faxes, mobile phones, video communication devices, and solar power generation.
・Joined INTAGE in 2013, and engaged in domestic and overseas consumer research and consulting.
・Established the “Future Co-creation Center” in 2017, where he has conducted a large amount of joint research projects (POC) and consumer research with a focus on creating new value through co-creation with companies.
・Currently interested in the well-being field
Participating in Datability Consortium Organization
「Launched a “Well-being Committee” and is engaged in co-creation activities with different industries.
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