Luxury Consumers: Turmoil, Optimism and Comparison Shopping
Dec 2, 2011
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There is "turmoil" in the luxury consumer mindset, but also growing optimism and a growing emphasis on money-saving strategies, according to the latest Luxury Consumption Index (LCI) from Unity Marketing. The fourth quarter 2011 results come from a survey of 1,498 affluent luxury consumers with an average income of $279,000 and an average age 44.
"Our latest survey reveals turmoil in the luxury consumer mindset, just like the Dow Jones Industrial Average measures turmoil in the investment markets," said Pam Danziger, president of Unity Marketing. "Affluents are uncertain about their present financial status and worried about the overall economy, which translates into more cautious spending on luxury indulgences. For example, 70% of the luxury consumers surveyed this month said they are spending the same or less on luxury now than they did twelve months ago."
But the results also show luxury consumers growing more optimistic about 2012:
• 45% expect their financial situation to improve in the next 12 months
• more of these consumers expect to spend more on luxury in the next 12 months
"The recent uptick in the LCI combined with the trend we have seen in our studies that people typically have a more positive outlook and greater confidence in the first quarter of the year may signal a good first quarter in the market for luxury goods and services," Danziger said. "But that doesn't mean luxury marketers can ease off. They must keep doing all the right things to pull in affluent customers and encourage them to spend, and that means delivering high quality and good value at the right price."
She said luxury marketers should not sit back and wait for an upswing.
"Since luxury is 100% discretionary, it's the first place for people to look to manage their spending," Danziger continues. "Nearly three-fourths of affluent customers surveyed are using one or more money-saving strategies. Among the most popular ways luxury consumers save are to do more comparison shopping, shop less frequently and reduce the number of times they dine out. Clipping coupons and doing product research are also popular ways to cut costs."
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