Whether you are selling to a traditional consumer or mass consumers or luxury consumers, understanding and positioning effectively for HENRY is the key to your success. They are the ‘High Earners Not Rich Yet’ because they have significant discretionary income and are also known as ‘the working rich’.
The term was coined by Shawn Tully in Fortune Magazine around 20 years ago, for the people earning between $2,50,000 to $5,00,000 with zero savings and high expenses. This segment has specific characteristics and can be differentiated/ identified from others because of tell-tale signs like making huge money, having high-cost life, and doesn’t have an emergency fund.
Priya Malani, Founding Partner at Stash Wealth, defined HENRY as "They're people who want to get their financials together, but still keep their avocado toast, SoulCycle, and boozy brunch lifestyle”.
Synonyms used for this segment also include ‘zero wealth building’, ‘working rich’, ‘six-figure income’, ‘having pleasure fund’, and many more.
HENRY’s are the aspirational buyers for marketers as this segment focus on affording rich status and a high lifestyle. They are financially savvy, credit card users, likely to be married, online shoppers, and travelers who love experiences, can attain unique/ limited choices, and are aspirational. The most important characteristic of this segment is that they have the potential to improve their personal brand equity
These days, the prime target segment for luxury marketing is HENRY’s and marketers have developed unique advertising strategies keeping their core values in mind: uniqueness and identity.
To position, their brand marketers are promoting their products through renowned celebrities and communicating the message about their status. HENRY is a segment that loves to flaunt the usage of high-status goods among their peers and makes maximum use of social media platforms to appreciate the luxury goods market.
And similar to this, luxury and premium brands like Louis Vuitton, Tag Heuer have also incorporated social media advertising and influencers in their marketing strategies.
Luxury brands have realized HENRY’s perspective towards luxury as, ‘for them, luxury is a mindset, not a brand or a price point’ and thus marketing tactics have been given importance for this digitally empowered generation.
Any brand that is targeting middle-class or middle-income consumers, HENRY is the new target segment for them too. They are the new consumer segment with smart choices and can be targeted by combining the strategies by high-end brands with mass marketing tactics so that HENRY’s can see the return on their spending investment.
Millennial HENRY Market
In one of the studies done by Maritz, it was suggested that to have a successful loyalty strategy, brands should realize that millennials are not their target market, there is an affluent sub-group that needs to be investigated.
Creating engagement with HENRY at the brand level is very important because they are making purchase decisions with their ideal self in mind and focusing more on experiences. They have grown up on the internet and instant answers to their inquisitiveness with a smooth transition from desktop to mobile browsing will save brands from their wrath. Personal choice is the status symbol for HENRY consumers as luxury is an individualistic concept rather than a status symbol for them.
To successfully meet HENRY’s needs, brands have to be vigilant about their services and should appeal to them through inspiring brand stories. Identifying the ‘sweet spot’ which lies somewhere between good, better, and best will help the brands in achieving premium pricing while targeting them.
The question to ponder upon is what makes it difficult to achieve wealthy status and when HENRY will move from ‘not rich yet’ to ‘high society’.