Written by Katia Ponnampalam • Published 18th September 2017
The super yacht industry is easier to caricature as the preserve of vulgar billionaires and super yachts as the playthings of the idle rich. Picture spreads in the Daily Mail of celebrities in bikinis squiring Russian oligarchs have become as predictable as the August silly season.
The headline writes itself: “Sailing Yacht A is worth £360m with masts taller than Big Ben and dwarves Philip Green’s Lionheart, which cost a mere £115m – he must be green with envy”.
The sneering tone is all too familiar. Super yachts are ‘blingtastic’ status symbols for the super rich and their owners are objects of ridicule.
Does it matter to the industry? Should brokers care this is the image of the super yacht sector projected to the outside world?
At first glance, it’s easy to dismiss it as irrelevant. Super yachts are the epitome of luxury and supposed to be big, brash and beautiful – well, big and brash, at least. They are an ostentatious display of wealth, a deliberate message their owners want to send out to the world.
But, in a deeper sense, I think the industry should be concerned by these lazy stereotypes. They don’t convey the nuances of an industry that has changed considerably in the last 50 years, when there were just 14 international yacht brokerage houses, compared to today when there are more than 150.
They don’t reflect the fact that, out of a fleet of around 6000 super yachts above 24m, around 1400 are available for charter. The world has changed a great deal since the owner of the award-winning sailing yacht, INOUI, was quoted as saying he couldn’t understand why any owner who had invested so much in building their dream yacht would ever consider chartering it.
A generation ago, many owners agreed with him, but the charter industry has opened up the world of yachting to a new demographic. It has put super yachts within the reach of a new type of customer. Once, they would have considered super yachts as an aspiration that was out of reach; now it has become a reality.
Reaching this audience is crucial. Doing it successfully means the whole sector expands; not only in the short-term because a buoyant charter market is good news for owners and brokers, but in the long-term too because today’s charterers are, in same cases, the next generation of owners.
But how do you reach this audience? That’s an important question for brokers and I’m not convinced enough time is spent addressing it.
There are five questions every brokerage house should ask itself:
- Have we accurately identified our target audience?
- Do we know where to reach them?
- Are we conveying the right messages?
- Are we using the right communication tools?
- Are we using the best communicators?
Reaching this audience requires a leap of imagination because it is not necessarily a typical yachting market. It means moving out of the comfort zone, not talking only to the traditional yachting titles and media platforms – important as they are – but preaching to the unconverted and could-be-converted too.
Chartering offers a unique luxury holiday experience, with a bespoke itinerary and an opportunity to visit remarkable destinations that are not accessible to most holidaymakers. It’s a high-end holiday limited to an exclusive market. There is a mystique to it, which is part of its appeal, but also puts off potential customers who could afford to charter but don’t realise it’s for them. They don’t understand it and that may put them off finding out – they don’t realise that they don’t need sailing experience or expertise; that what they are buying is the expertise of a fantastic crew and a captain who will handle every aspect of the trip.
The challenge is to find this audience and explain the chartering experience to them, dispelling some of the myths and spelling out its appeal. That requires more mainstream media engagement than brokers sometimes realise – High Net Worths who currently have no interest in yachting are as valuable a commodity as those already steeped in the industry, they are just more difficult to reach.
Finding a PR agency with experience of engaging with this audience, across the wider luxury sector, rather than an agency with expertise and contacts only in the yachting industry is a way of trying to do so.
There is another reason why brokers should worry if the super yacht industry is not taken as seriously as it deserves: it under-estimates their own value.
Thirty years ago, professional yacht management companies didn’t exist. But today, for yachts over 40 metres, they are essential. The extent of administration and paperwork required to run a crewed yacht has changed out of all recognition as the rules have become increasingly complex. Tax charges and regulations for entering territorial waters have multiplied; dealing with them while also ensuring a yacht is properly managed operationally, financially and technically has become a job beyond the capabilities of an owner or captain.
And, when it comes to buying and selling in an increasingly sophisticated marketplace, brokers add value by their intimate knowledge of the condition and history of yachts; what’s for sale on the open market and, more importantly, what is privately for sale but is not being advertised. Bringing together all the necessary technical and regulatory knowledge, an ability to drive the sales process and to deal with the after-sales process are necessary but under-appreciated skills.
Fifty years ago, the super yacht industry did not exist. Today, it generates as much as £20 billion in revenue and employs up to 300,000 people in more than 6,000 companies with around 300,000 working on the yachts. It is no longer a cottage industry.
Super yacht companies need to take a more sophisticated approach to communications. They need to think more carefully about the image they are projecting and whether they are cutting through to a wider audience rather than talking only to their existing customers.