U.S. wealthy cut luxury spending by 27 percent
Unity Marketing revealed that affluent U.S. consumers spent 26.5 percent less on luxury goods in the first quarter of 2015 compared with the fourth quarter of 2014. However, in the group’s recent Luxury Consumption Index, which measured the spending habits of those with an average income of $266,900, economic confidence improved. ”People with high incomes have changed their shopping habits, focusing on brands that represent a good value, rather than high-status brands.” said Pam Danziger of Unity Marketing.
U.S. affluent consumers are choosing function and performance over ostentatious style, giving emerging luxury brands a foothold that almost didn’t seem possible a decade ago. Affluent consumers are also valuing a personal connection with the artists and designers of those products they buy. Furthermore, a cultural desire for “responsible consumerism” is creating opportunity for fair trade products. “The Internet will continue to change luxury brand marketing because of this new transparency,” Danziger said. “Luxury brands need to tell new stories to their target customers that reflect a responsible face of luxury focused on values and substance, rather than simply ostentatious style.”