Luxury Consumers Are Big Spenders
The confidence of high-end consumers hit a record high in the
first quarter of 2006, increasing 8.4 points to reach 113.2
points on the Luxury Consumption Index by Unity Marketing (Stevens,
Pa.), a marketing consulting firm. The increase follows a 10.4-point
increase at the close of 2005.
Launched in 2003, the index measures luxury consumers’
feelings about their personal financial status and the prospects
for the country as a whole.
High confidence among luxury consumers translated into a
big boost in spending: From January to March, the typical
luxury consumer spent an average of $13,820, up 18 percent
over luxury spending in the same period last year.
“Luxury consumers expressed the most negative feelings
to date about the country’s overall financial health,
with 46 percent saying the country as a whole is worse off
now than it was three months ago,” said Pam Danziger,
president of Unity Marketing. “Yet they are incredibly
optimistic about their own financial status. This then translated
into significantly stronger spending on luxuries during the
first three months of the year.”
The findings are based on Unity Marketing’s quarterly
luxury tracking study, which surveyed 1,196 luxury consumers
with an average income of $145,700 and an average age of 43.
Information about purchases, spending, store and brand preferences
were collected in four major categories of luxury goods and
services, including home luxuries; personal luxuries (clothing,
fashion accessories, jewelry, watches, cosmetics, wine and
spirits, pet luxuries, and pens); automobiles; and experiences
(dining, travel, home services, spas/beauty services and entertainment).
“Every category of luxury enjoyed an up-tick in consumer
spending in the first quarter 2006, while average spending
on home luxuries … increased the most,” Danziger
said.
“The strong increase in the index this quarter is a
function of two psychological shifts,” said Thomas Bodenberg,
economic forecaster for Unity Marketing. First, luxury consumers
have made adjustments for the increased price of oil. Second,
there is an expectation that American involvement in the war
in Iraq will diminish. These factors combined with the strength
in the stock market are reflected in luxury consumers’
increased confidence.”
For more information, visit www.unitymarketingonline.com/reports2/luxury/luxury3.html.
[August 2006 PET AGE]
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