According to a Luxury Institute study conducted in August, currently summarized in a two-part AdWeek state-of-the-market series, 77% of high-end shoppers “agreed that luxury is less important in today’s economy.” So, I should return that Fendi baguette I bought last week? Shucks.
Surprisingly, the majority of affluent consumers aren’t big luxury shoppers. Pre-recession, most of the luxury market’s power came from lower-income aspirational buyers. Now they can no longer afford to shop that way, so luxury brands are looking for new ways to sell to the actual wealthy.
According to the survey, many affluent consumers said that they’re primarily interested in quality and service, which they consider hard to find in luxury goods.[more]
The survey also found that the rise of discounting has damaged people’s brand perception. “Radical discounting is a disaster. It tells people how big the margins were.” Shoppers are confused, forgetting that luxury items are more expensive because they are of higher quality.
AdWeek suspects that shoppers will be be much more discriminating in the future. One expert mentions a “rise of connoisseurship.”
Nine percent of those surveyed said that they plan to spend nothing on gifts this holiday season. So be on guard for poor Secret Santa goody bags.