Jamie Obertelli: Welcome to the latest Infinite Global podcast. Today we’re continuing our series on thought leadership with a focus on the Knight Frank Wealth Report, a global publication that’s regarded as an example of best in class intelligence and has been enormously valuable for the residential and commercial property consultancy since it’s inception.
I’m delighted today to be joined by Knight Frank’s Liam Bailey, Partner, and Global Head of Research, and Andrew Shirley, a Partner and Editor of the Wealth Report. Thank you for joining us today, guys.
Liam Bailey: Thank you.
Andrew Shirley Great to be with you, Jamie.
Jamie Obertelli: We work with a number of clients to produce intelligence led thought leadership and whilst those projects are often incredibly varied in nature, none of them would be a success without the initial work to make sure that each idea is solid from the outset. Liam, you’ve been at Knight Frank since the inception of the Wealth Report, can you tell me a little bit about the thinking that went into the creation of the report as a concept?
Liam Bailey: I think the starting point was to be fair was to just to produce a report. I don’t think we had any idea at the outset that we’d be producing a report that would be alive 10 years plus later. And we were working with Citi Private Bank at the time with David Poole and his team and we were just kicking around some ideas about how we might like to develop a research stream that was looking at property in the wealth portfolio. And the first report that we produced, which was, I think we called it the Annual Wealth Report, but we committed ourselves to at least a follow-up. The first report was kind of an extended essay really. We sort of kicked it off when we were looking at the concept of plutonomy, which was something which the Citibank research team had been looking at, which was the outperformance of wealth, or the fact that wealthy people were becoming wealthier quicker than the rest of society and what did that mean in terms of investment decision-making?
So that was our kind of starting point. And we began to look at issues around property performance and prime markets and luxury markets around the world. And I think from there it became apparent that the response from clients is very positive, they thought that the approach we we’re taking was interesting. And we embarked then on a rerun in 2008, which was when Andrew joined the team, our second edition. And we began to kind of shape the report and the kind of current format looking at sort of property markets, the wealth portfolio, lifestyle items began to evolve from those beginnings. Andrew is that your recollection too?
Andrew Shirley: It was about starting a conversation with our clients, letting them know that we understood their aspirations and lifestyles rather than just their property needs. So it was adding real value. We were sort of talking about things that would interest them and as you’ve said, it’s sort of grown as we’ve learned more about our clients during the process. We’re now about to launch the 15th edition. Over that period we’ve learned a lot about what our clients like to read about and what they find interesting and I think key point about the report is it’s not an explicit, hard sell. We are providing data and insight that we think our clients will be interested in, rather than pushing any kind of specific Knight Frank services. So maybe a bit of a cliche, but it’s all about thought leadership.
Jamie Obertelli: What exactly was it that you were hoping to achieve with the first iteration of the Wealth Report? Liam, you mentioned it’s evolved massively and started off as a bit of an extended essay, so is it fair to say that what you’d initially envisaged is very different to what it’s become now?
Liam Bailey: Its certainly changed and evolved over time. I think probably starting point back in 2007, you know you’re at the end of the 2000s boom, property prices in lots of parts of the world had been rising rapidly, you had asset price bubbles in lots of locations and I think there was a question mark over or A the sustainability of those trends, but there was also a question about just the generation of wealth. It was apparent through that boom period that in lots of parts of the world fortunes were being made across Europe, Ireland, and the property market was kind of pretending the creation of those fortunes. And I think it was an opportunity to step back and look at what was driving those trends and actually looking at the sustainability of them as we published the report.
I think, you know, we were suddenly entering the very peak of the market in 2007. The first cracks were repairing in the Interbank loan market and the beginnings of the cracks in the financial system were just beginning to appear, so it was a very timely period to put the report out. But, I think, I suppose underpinning everything was just a feeding that whilst there were lots of banks and lots of consultancies producing reports, looking at the performance of financial assets and looking at the financial wealth portfolio, no one seemed to be doing the same thing with the property element of the portfolio and that was where we felt we had an opportunity to bring something which would provide insight that just wasn’t being provided at that point.
[Jamie Obertelli: You had the chance to be one of the first brands operating in this arena and since then you’ve had a lot of other entrants coming to market with their own offerings in the wealth space. Do you think there’s real value in the fact that you got there first and has that helped solidify your position?
Andrew Shirley: I’d say we’ve done it so well, being slightly modest, it’s very difficult for anybody to muscle into that sector because we put such a lot of time into the design and the editorial content. It is quite a unique looking magazine, so for anybody else to replicate it would be quite difficult. So I think if you’re doing this kind of project you want to do it really well and set a very high benchmark and that is going to protect you from your competitors.
Liam Bailey: I’d agree with that and I think there are different products out there, I mean, there’s a number of publications, for example, Capgemini produced the wealth report for a number of years and it’s attacking a different, or it’s approaching this story from a different angle and it’s a completely valid approach. And I think there are any number of, say for example, WealthX and Wealth Insight, the wealth research houses, they produce their own insights through the year. But again, they take a slightly different approach and I suppose for all of the reports in the market, it may appear that there’s a lot of material written about wealth and so forth, but I suppose, because they come from generally a slightly different perspective, there is room for all of these publications. I think, you know, to Andrew’s point, we’ve probably developed a product which sits slightly apart because it’s that combination of what we’re trying to do is deliver insights, so we have a lot of data in the report, but it’s also very deliberately editorial driven and the feedback we get is it, you know, it seems to be a compelling read for our clients.
Jamie Obertelli: When we set about developing a concept for any big ticket thought leadership campaign with our clients, we make sure that all parties are very clear from the outset on the purpose of the content. Often, if you speak to a marketer, as opposed to the people who are involved in the actual nuts and bolts research that goes behind a publication like this, you’ll get very different answers on that. Obviously for Knight Frank, as an organization, it’s in your interest to show that you are best in class, that you have the best thinkers that you have the best understanding and market intelligence. But at the same time, you never create research and reports like this purely out of the goodness of your hearts, there has to be some sort of commercial benefit. So from a commercial sense, what’s the real value of the wealth report and how has that benefited Knight Frank over the years?
Liam Bailey: The report has been enormously beneficial to Knight Frank. I think it probably started off, you know, initially it was a residential focused publication and I suppose the implicit message from the report was we are experts on global luxury residential markets. We don’t need to tell you that because if you look at the data and look at the insight we’re providing, it’s quite clear, the only people who can do that are the people who are an organization who are world leaders in those markets. So that’s the kind of approach we’ve taken. And I suppose over the last four or five years, we then branched out and actually got much more commercial property content into the report. So it’s actually looking at a more holistic view of wealth investment into property. But I think the approach that we’ve tried to take with this is that rather than claiming we are the dominant players in whatever market, just by the fact that we can bring to bear a range of expert comment and also some proprietary data and some detailed statistics etc, it shows the reader that ultimately, we are all over these topics because we are significant players in all of these markets. And I think the approach we’ve taken seems to have worked very well in terms of a commercial positioning, because the report has developed hand in hand with the growth of our private office network in the UK, and then increasingly in other global locations. And it’s cemented, I think, across the business, but also with our clients, the view that Knight Frank is providing a long-term advisory role, as well as just providing agency services in terms of buying and selling a property, we take a long-term view alongside our clients.
Andrew Shirley: People like to work with people who share the same kinds of views, so we’ve picked up what our clients are interested in, whether it’s the environment or philanthropy, so we’ve talked a lot about that in the Wealth Report as well. So when your clients read that, you know, the firm they’re going to be dealing with is on the same kind of wavelength as they are about those specific subjects, beyond just property investments, I think it gives them the confidence to deal with us, knowing that we think the same way as they do.
Jamie Obertelli: Right. It’s a case of show don’t tell. You’re constantly demonstrating that you understand their world.
Andrew Shirley: Exactly. Yes.
Jamie Obertelli: A piece of thought leadership on this scale will always have some form of anchor from which everything else hangs off. Is there a particular part of the Wealth Report that acts as that kind of anchor? With data led content it’s normally an index of some sort or IP that you’ve developed specifically for the campaign. So is there a part of the wealth report you think is the main focus and everything else sort of slots into place around that?
Andrew Shirley: I would say, PIRI, would you agree with that Liam?
[Liam Bailey: Yeah, I think it’s PIRI, which is the prime international residential index. So we’ve got an index of a hundred luxury residential markets around the world and we claim, and I think it’s true, it’s the most comprehensive index of its kind. We’re tracking the performance of all of these luxury markets and that is undoubtedly a centerpiece of the report. I think also potentially the attitudes survey, which Andrew leads a survey of around 600 wealth advisors, family offices around the world and that also gives us a lot of data throughout the report. But I think the findings from the survey, as we begin to crunch them in the months before production of the report, it begins to help drive the stories and the narrative as well. So I think that those two pieces to me are kind of critical in drawing together the report.
Jamie Obertelli: Initially the Wealth Report was considered more of a print publication and the third factor was really important, but as social media has changed and the way that the digital landscape has evolved, obviously the publication has had to embrace that. The work that we do with our clients on thought leadership always has to get the balance right between physical and digital. I’m curious as to how you’ve gone about taking the digital elements of the report to make it more than just a traditional print publication?
Andrew Shirley: That’s a good question Jamie, we’re in the middle of redeveloping, our Wealth Report’s digital presence, so very much aware that we need to create a wide range of content. It’s been an evolution. We’ve done a lot more on social media and of course the COVID pandemic has meant we can’t get out and about to talk about the report’s findings face-to-face. So we’ve been doing a lot more sort of webinar type content, but what we’re really keen to do is position this idea that the Wealth Report is an ongoing conversation. It’s not just a one-off publication. So we’re trying to create new content throughout the year, or utilize our existing content to add to the themes that we’ve discussed in the report.
So for example, this year, our main theme was wellness and of course the pandemic has highlighted that as something that’s hugely important to people. So for example, in Asia Pacific, the other day, we did a webinar all about wellness related to property developments. We’ve done surveys showing where people want to live in the future and linking that back to the existing content in the wealth report. So it’s an ongoing conversation.
Liam Bailey: We recognize, as Andrew says, that we can do much, much, more in terms of our digital offering and that’s something we’re working on at the moment. And in fact, the whole debate about actually whether the report should be physical, or whether it should be physical and digital, or just digital, is it ongoing? I think there’s a couple of reasons why we’ve all settled on actually that there should be a hard copy report is because we’re very much in a people business. One of the key wins from having the report, the actual artifact, in the hands of our staff and our teams is that when they meet with clients they can hand it over as that’s going to leave behind or a record of our views. It’s a very good part of that process of actually meeting clients and passing something over. So that works, I think very well for us. And the fact that producing a print report of the size of the Wealth Report, is a big investment. So you’ve got to think very carefully about that approach. Once you have the platform, digital is a slightly more affordable option in some ways.
I think the other problem that you have having both routes, as Andrew mentioned, so digital and hardcopy, is that the actual hard copy is an annual publication, and the problem with an annual publication with the amount of work and prep that goes into the Wealth Report means you can get caught out. So, for example, the Arab Spring, we were about to get a print and then suddenly events happened that need to be included. You know, the report will be dated if it doesn’t include them, so you’ve got to do a huge amount of work at the last minute to make sure that you’re actually timely. You know, with something like the Economist or a monthly publication, there’s more room for maneuver. If you’re able to update on a rotating basis in terms of print publications. But we are fortunate, I think, in terms of our investment strategy now to have that print publication as a kind of a line in the sand each year, but also to have the ability to keep the story live online and I think that will become more important over the next few years.
Jamie Obertelli: I’ve always found it interesting that with many clients where we are exploring digital pathways for their thought leadership, there is always an element of reticence to completely give up the print. And there are a number of reasons for that. Obviously having a physical copy, as you say, is really important. You’re able to hand people, something in metings, you’re able to leave something behind.
Liam Bailey: I think the other thing, just on that though, is that the one thing that we’ve sort of developed in the last few years has been the, we call it the Databank at the back of the magazine, which has got a digest of all the key stats and facts and figures and so forth, and in a sense it’s a record of the data. It’s a very useful thing. If you’re in the wealth industry or you’re working in the luxury property sector or the investment sector is a very useful set of statistics that have at hand. So actually the hard copy report is just convenient to have on the desk as a kind of reference tool. The hardcopy does actually have that role to play
Andrew Shirley: It has a lot of longevity. People don’t just chuck it away, it will stay on people’s desks because as Liam says, they like to refer back to it, which is a great marketing too if you can keep something that people are going to be constantly looking at.
Jamie Obertelli: As an organization, Knight Frank produces an incredible amount of thought leadership across all of the different regions that you have a presence in and that has grown over time. Has your experience at developing the Wealth Report informed any of your approaches to any other data publications that you’ve created since?
Liam Bailey: Well, I think we’ve created stable of publications which speak to our main business areas. So for example, the commercial property research teams have developed Your Space, which is our occupier report, and then we have Active Capital, which takes a look at the investment market in more detail. Youve got your Rural Report as well. I think there are a number of what we call our flagship reports, which are deliberately aimed at capturing those sectors. The Wealth Report I suppose, it’s been a bit of a trailblazer in terms of showing what’s possible, but then it’s kind of evolved into those different sectors. Where we’re trying to move now, or we’re increasingly we’re moving is recognizing that actually a lot of our clients, unsurprisingly, are interested in all of those areas. And if you are high net worth is investing in property and you have a portfolio, the Wealth Report is a very useful document. So is Active Capital. So is Your Space and the Rural Report. So I think what we’re now working on is just making sure that actually we’re carrying the narrative of our key themes through all of those reports. They don’t sit in isolation. They may focus on it in a slightly different way on a slightly different sector, but they’re part of the whole terms of our output.
Jamie Obertelli: Our work is never finished once we’ve simply created a piece of thought leadership for a client. A similar amount of energy and resource, if not more, goes into making sure that it’s leveraged properly. How do you go about activating something that’s the scale of the Wealth Report? And by that I don’t mean traditional external tactics, which in some ways are more straightforward, like launch events and media relations. But how do you get all the main stakeholders onboarded and understanding all the key messages to make sure that everyone’s singing from the same hymn sheet?
Andrew Shirley: With a lot of hard work, Jamie. I mean, it’s been a long process to get everybody around the Knight Frank network in different parts of the world fully involved. And it’s having a conversation it’s talking to people, it’s making them feel, why is this report relevant to me? You can’t just push it out there and expect people to engage with it instantly. So it’s, you know, it’s a constant program of talking to people and getting their feedback and incorporating their ideas into the report. Making them feel like they are genuine stakeholders, rather than people who’ve just been told to do something. So it’s been a long process, but I think we are there. We have huge engagement from our teams in Asia Pacific in particular, the middle East Australia and Africa, but there’s no simple way to do it. You’ve just got to work really hard on it and you’ve got to facilitate events and PR by providing them with the materials to backup those kinds of events. But you’ve got to give them the confidence also to feel that they are part of the product and they can share their opinions on the topics that are in the Wealth Report and the report answers the questions that they want to share the answers with their clients. It’s a long process of engagement, there’s no silver bullet to get a global network to get behind a single report.
Liam Bailey: It’s a two-way street really as well, because on the one hand, as Andrew says, you know, we need to produce a range of materials so that we’ll have the report, digest it and put into bullet form, key messages and so forth, to help people absorb the content. But I think also it’s the response from our teams. I don’t think we’ve ever really suffered from an ivory tower syndrome where we just want to produce an interesting report with interesting data and with no thought to how it would be used. But I think the challenge from the estate agents and from our consultants is actually, it’s always quite tough in terms of what’s the story, what’s the take away? What does it mean? Why should my clients be interested? So there’s quite a positive challenge, I think, from the business to ours, to actually make sure that we’re delivering something, which actually is telling something of relevance to the clients and also to our teams.
Jamie Obertelli: I’m sure our listeners will really value the insight into what it takes to bring something like the Wealth Report to life.
Andrew Shirley: The next one will be out in March if anyone’s been inspired and wants to get a hold of a copy.
Jamie Obertelli: It’s been great having you both on today. Thank you for joining us.
Andrew Shirley: Thanks Jamie.
Liam Bailey: Thank you. Bye.
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