US. Luxury consumers in the US have expressed caution in spending during first quarter 2004, reported the luxury goods consultancy Unity Marketing this week.
After ending 2003 on a high note, luxury consumers stepped back slightly in their overall confidence with the March 2004 Luxury Consumption Index at 97.8, compared with a baseline of 100 in January. The luxury consumption index is a tool prepared by Unity Marketing to help luxury marketers assess the affluent market.
“Luxury consumers started the new year feeling very positive about their financial well-being, but that moderated during the first quarter 2004.” said Pam Danziger, president of Unity Marketing. “The luxury consumers’ expectations for future spending on luxuries dipped in relation to their ability to spend.”
A key psychographic characteristic of the luxury consumer is a cautious outlook about their personal finances. “These consumers are heavily invested in maintaining their luxury standard of living and do not spend anywhere near to their capacity. Their expectation for luxury spending lags their feelings of financial well-being. Far from viewing luxury consumers as spend-thrifts, marketers need to understand that these ‘thrifty rich’ are always on the hunt for a bargain,” Danziger explained.
Thomas Bodenberg, statistician for Unity Marketing and former Conference Board executive added: “Despite conflicting economic news, and the uncertainty in the marketplace caused by the Iraqi conflict, the 97.8 index shows merely a minor deterioration in confidence and purchase intentions toward luxury goods and services.
“As we enter the election cycle in full force, we can better examine the impact of the economic and political environment on present and future expenditures for luxury goods and services.”
This benchmark index of luxury buyers is calculated from a sample of 650 upper-income households throughout the US. This panel, with household incomes over US$75,000 (one-third over US$150,000) represents one of the largest longitudinal studies of high-end luxury consumption of goods and services. Panellists reported purchasing behaviour of luxury goods and services over the most recent two months, as well as attitudinal and expectation data about their households and the health of the economy in general.
Unity Marketing publishes its Luxury Tracking Study quarterly with the next due in June 2004. For more information, call Pam Danziger at telephone +1 717 336 1600.
