With luxurygoods rebounding following the Great Recession, upscale consumers overwhelmingly favor long-lasting, high quality product over one that merely enhanced status, according to a survey conducted in cooperation with the Luxury Institute and Lincoln Motor Company.
The survey asked wealthy luxury automobile consumers to share how their opinions may have altered since the recession about buying considerations and luxury spending across a variety of product categories.
“High standards for the tangible quality of goods are to be expected from such refined buyers,” said Luxury Institute CEO Milton Pedraza. “Of particular interest is the growing leadership of U.S. firms as global luxury brand icons. Jewelry from Tiffany & Co., consumer electronics from Apple and handbags from Coach are among the world’s most prominent brands, giving consumers worldwide more reasons to pursue luxury in the States.”
When asked what drives luxury and justifies premium pricing, 86% of affluent Americans surveyed say that superior craftsmanship is the deciding quality. Nearly as many (84%) say they also expect the use of superior materials in luxury products. The third most important consideration, cited by 76% of respondents, is a “superior customer experience both during and after the sale.”
Moreover, discretion plays a role in their decision making, too. More than 90% indicated that acquiring a long-lasting, high quality product is more important than enhancing their status and showing off to peers.
American Luxury Brands Growing in Influence
“What we see in this insightful Luxury Institute research is that during the recession, the U.S. luxury market changed and people changed,” said Jim Farley, executive vice president of Ford Motor Company Global Marketing, Sales and Service and Lincoln. “They want what appeals most to their desires and not what they believe will impress others and this is a trend we believe will continue to grow ever stronger.”
Among other findings in the survey released today, half of high-income shoppers rely on user reviews and the recommendations of family and close friends, enabling quick sharing of opinions and influence. This affords an opportunity to relative newcomers to quickly establish brands that compete with established names. Not to mention, offers traditional brands a means to reinvigorate themselves via digital media.
These top-two influencers of luxury consumers’ purchase decisions demonstrate how relative newcomers can quickly establish brands that compete with established stalwarts, and how traditional brands can reinvigorate themselves via digital media.
“What we hear consistently and loudly from wealthy consumers is that the manner in which the goods are sold, as well as the service provided after the sale, are nearly as important as the products themselves,” Pedraza added. “With American brands growing in luxury influence, there is a clear eagerness on the part of the global consumer to embrace American luxury brands, making service a critical success factor for the future.”
The Luxury Institute conducted an in-depth online survey with 1,216 affluent U.S. consumers in cooperation with the Lincoln Motor Company. Half male and half female respondents were recruited and screened to only include those age 21 or older with a minimum gross annual income of $150,000 and ownership/lease of at least one luxury automobile. www.luxuryinstitute.com