Sharing the Wealth

Never mind the dismal economy. Escape to a world of champagne wishes and caviar dreams, where you'll find rich opportunities to start a luxury business.

Flying a dog first-class to an exotic island so it can be shown off at an exclusive wedding. Planning an elite Manhattan soiree. Chartering the Concorde to fly to Antigua. Welcome to the world of very, very high-end luxury services. It's a world that Victoria Pericon, 30, lives in every day as founder of lifestyle-management firm Victoria Pericon Inc. in New York City.

Her "Club VP" is an invitation-only club that charges clients a $120,000 annual retainer fee, plus expenses, to take care of anything they need, from the glamorous (planning glitzy Mediterranean parties) to the mundane (waiting on hold with customer service to ask a software question). Pericon has three employees and hires outside consultants to work with the company's clients, who tend to be celebrities, socialites and CEOs. "We don't allow people to just call up," says Pericon, who has run the company for four years with her husband, Roman, 30.

Maybe you've wanted to start your own luxury business ever since you watched Joan Collins and Linda Evans duke it out on Dynasty. But maybe you're thinking now may not be the time to make your move. Retailers just had their worst holiday season in 30 years. Unemployment is at an eight-year high. Consumer confidence seems to be sputtering, too: The Consumer Confidence Index, a monthly survey of 5,000 U.S. households, fell 14 points in February, and consumers' feelings about the economy were at their lowest since 1993.

When you're targeting a very specific market--like luxury spenders--your focus has got to be spot on. "3 Rules for Niche Marketing" will help you aim clear.

Although the average consumer is spending conservatively, there's still a lot of money out there. The number of "almost rich" (households earning between $100,000 and $150,000 per year) has doubled. Last year, 15.1 million U.S. households earned more than $100,000 per year, according to the U.S. Census Bureau. The very rich, meanwhile, are getting richer: Between 1991 and 2001, the incomes of the top 5 percent of U.S. households increased from 18.1 percent to 22.4 percent of the total of all personal income earned in the United States.

The reality is that there are several categories of wealth today, says Arnold Brown, chairman of Weiner, Edrich, Brown Inc., a trend analysis firm in New York City. There are the ultra-rich (those worth at least $100 million), the rich (those earning at least $250,000 per year and having assets of at least $3 million, not including their homes) and the upper middle class (those earning $100,000, with assets of least $500,000, not including their homes).

The creation of wealth in the past decade is giving entrepreneurs more opportunities to sell luxury products, says Paul Nunes, senior research fellow at the Accenture Institute for Strategic Change in Cambridge, Massachusetts: "We're seeing companies coming into [the luxury] space as they recognize there's this segment now that has a whole lot more money."

Pericon won't dish names or sales figures--"Discretion is important," she says--but her business continues to grow. In June, the Pericons are launching their own magazine, Manhattan Syndicate, devoted to the affluent Manhattan lifestyle.

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Chris Penttila is a Washington, DC-based freelance journalist who covers workplace issues on her blog, Workplacediva.blogspot.com.

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This article was originally published in the May 2003 print edition of Entrepreneur with the headline: Sharing the Wealth.

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