*A Book Review*
By Robert Frank
by Michael C. Gray
November 2, 2015
This book could have been titled "Lifestyles of the Filthy Rich". Robert Frank is a reporter for the Wall Street Journal who worked full time investigating and profiling the growing wealthy class in the United States.
The book was published shortly before the Great Recession, but the very wealthy were much less affected by the recession than the general population, because they have a cushion of financial reserves, so most of the observations in the book are still valid.
Some people believe that wealth must be inherited and that it's harder to acquire a fortune today than in the past. Others believe you must be a celebrity to be wealthy. The statistics show all of these beliefs are wrong. New fortunes continue to be built in the United States, which now has more multi-millionaires than any other county. Those with inherited wealth are a minority of the wealthy. Show business celebrities are also a small minority of the wealthy.
In 2004, the richest one percent of Americans were earning about $1.35 trillion per year - greater than the total national incomes of France, Italy or Canada. Today's rich have formed their own virtual country, a self-contained world unto themselves, with their own health care system, travel network, separate economy and language.
As marketers, it's important to understand the thinking and concerns of this group, because this is where the action is. It takes a similar effort to sell a $500 million yacht to a wealthy customer as a Toyota Camry to a middle class customer, with a much bigger return.
Wealthy people are still "just people," but having multiple millions or billions magnifies everything, including neuroses (eccentricities), toys (yachts, private jets, automobile collections), homes (several, some with massive acreage that require upkeep). These individuals hire help for maintaining their households and managing their financial affairs to free their time to devote to their businesses, their families, and their interests.
Since they have competitive natures, the wealthy are also competitive in their areas of interest, such as having the biggest yacht with the most features (basketball court, swimming pool, movie theater) and in charitable giving (good for the rest of society).
As customers, the wealthy aren't only interested in the product or service they purchase, but the experience. They expect extraordinary treatment, while claiming to be "just ordinary people."
The picture that Frank paints is quite different from The Millionaire Next Door. You will probably find wealthy people who fit both profiles. I would think that as the wealth level increases to the multi-million or billion level, wealthy people would have to devote more of their resources to hiring help for managing their time and assets, and enjoying some of the fruits of their efforts.
Most of us are naturally curious about the subculture of wealth, and would have more valuable insights from studying Richistan than watching the Kardashians.
Buy it on Amazon: Richistan: A Journey Through the American Wealth Boom and the Lives of the New Rich.
For our new reviews of business and self-improvement books, subscribe to our newsletter, Michael Gray, CPA's Tax & Business Insight!
Home Introduction Seven Habits Business Improvement Book Reviews Need Help? Links