Luxury consumers are starting to recover from the recession, suggests the latest Luxury Tracking survey conducted by consulting firm Unity Marketing, according to www.diamondintelligence.com. Some 48 percent of affluent luxury consumers believe that their personal financial situation will improve over the next twelve months, the highest level reached since the third quarter of 2007, finds the survey.
However, while the survey shows definite signs of improvement, Pam Danziger, president of Unity Marketing, warns luxury marketers not to be overconfident or assume that affluent shoppers will demonstrate the same enthusiasm for conspicuous consumption as they did before the recession.
Luxury consumer confidence, as measured in Unity Marketing's exclusive Luxury Consumption Index (LCI), gained 18.6 points in the second quarter 2009, the largest quarterly increase measured since the firm started its luxury tracking in December 2003. Moreover, the average amount that affluent shoppers spent on luxury was up nearly 11 percent over the same period last year. These findings are based upon a survey of 1,017 affluent consumers of luxury (average income $207.8k; age 44.3 years) fielded July 7-12, 2009.
However, such positive trends are tempered by the fact that the average amount that affluent consumers spent on luxury declined from the first quarter to the second quarter 2009.
"Unity's research shows that affluent consumers' basic attitudes and motivations that underlie their patterns of consumption are changing, and these changes are likely to outlast the economic downturn," says Danziger, who believes that luxury marketers should align their marketing and branding messages with "the new values-based mindset" of luxury consumers.
"As more and more American families feel the negative effects of recession, the idea of 'luxury' and the 'luxury lifestyle' is assuming a negative connotation," adds Tom Bodenberg, Unity Marketing's Chief Economist. "So while some affluents will relieve pent-up demand for luxury goods as a vehicle of lifestyle aspiration and expression as the recession ends, the media's focus on recession chic' - personal expression that deliberately excludes luxury goods - may leave a lingering distaste for conspicuous consumption and parading luxury labels," warns Bodenberg.
