Experiential Luxury Report 2007: The Ultimate Guide to the Luxury Consumer Market for Experiential Luxury Marketers

Published by: Unity Marketing Inc.

Published: May. 1, 2007 - 143 Pages

Table of Contents

Chapter 1 — About the Luxury Market

• Figure 1: Leading Luxury Marketers Revenues, 2003-2006

Some 32.5 million Households Rank among the Nation's Top 25 percent

• Figure 2: Number of Households by Income, 2004 & 2005

Number of Households at the Highest Income Levels Are Growing Fastest

• Figure 3: Total number of affluent households

Demographics of the Top 25 Percent of Americans

• Figure 4: Household income by age, 2005

Affluents Make More, Spend More and Save More

• Figure 5: Annual expenditures, 2005: Average U.S. households compared with
affluent

Trends in Affluence

• Figure 6: Ages of Affluence, number of affluent households 40 and under and
over 40 years old

Lifestage Changes Impacts the Luxury Market

• Figure 7: Triggers for luxury purchases, 2006 & proj 2007 (Source: Luxury
Tracking, 4Q06)

Luxury Consumers’ Plans for Home Changes Reduced from 2005

• Figure 8: Home Changes 2005 (2Q2005 Luxury Tracking), 2006 and proj
2007

Luxury Consumers Rose from Middle-class Backgrounds

• Figure 9: Financial status of family of origin (Luxury Tracking, 2Q04)

New Luxury Market Paradigm — From Things to Experiences

Experiences Provide the Greatest Luxury Satisfaction

• Figure 10: Source of Greatest Luxury Satisfactions (1Q2006 Luxury Tracking)

• Figure 11: Sources of Greatest Luxury Satisfation by income

Chapter 2 — Luxury Market Topline Findings. 2005 & 2006

Luxury consumer spending declines in 4Q2006

• Figure 12: Luxury Consumption Index thru 4Q2006

Luxury Consumers’ Feelings of Financial Well-Being

• Figure 13: Financial Well Being

Luxury Consumers and Reported Spending Trends

• Figure 14: Luxury Spending Trends Past Twelve Months

Luxury Consumers and Their Spending Expectations

• Figure 15: Expected Spending on Luxury Next 12 Months

Luxury Consumers’ Confidence in Financial Health of the Country

• Figure 16: Overall Financial Health of Country

Luxury Consumers Confident of Their Personal Ability to Handle Economic Turmoil

• Figure 17: Financial Prospects Next Twelve Months

Total Luxury Purchase Incidence

• Figure 18: Overall Luuxry Purchase Incidence (All Affluent Consumers)

Luxury Purchase Incidence, 2006 & 2005

• Figure 19: Luxury Purchase Incidence

Luxury Consumers’ Average Spending Increases in 2006

• Figure 20: Average Spending on Luxury, 2004-2006

Luxury Spending by Income Segments in 2006

• Figure 21: Luxury Spending by Income Segment

Luxury Spending by Income Segments 2005 and Comparison 2006

• Figure 22: Luxury Spending by Income Segment 2005 and comparison 2005 to
2006

In 2006, Young Affluents Out Spent Older Luxury Consumers

• Figure 23: Luxury Spending by Age - 40 and Under and Over 40

Men Spent More than Women in 2006

• Figure 24: Luxury Spending by Gender

Luxury Consumers Remain Value-Oriented

• Figure 25: Most Recent Luxury Purchase Bought on Sale or at a Discount
(4Q2006 Luxury Tracking)

Luxury Market Reached $834.9 Billion in 2006

• Figure 26: Luxury Market Potential

Non-Store Retailers Continue Their Vital Role in Luxury Shopping while Department Stores Stay
the Favorite

• Figure 27: Where People Shopped for Home and Personal Luxuries

Nordstrom Takes Lead as Luxury Shoppers’ Favorite Luxury Department Store and Target Is
Tops for Mass and Discount Stores

• Figure 28: Store Brand Usage for Any Luxury Shopping

Luxury Consumers’ Favorite Magazines

• Figure 29: Luxury Consumers Favorite Magazines

Chapter 3 — Experiential Luxuries

Purchase Incidence of Experiential Luxuries Remains about the Same

• Figure 30: Experiential Luxury Purchase Incidence, 2005 & 2006

Average Spending on Experiential Luxuries Dropped nearly 5 percent in 2006

• Figure 31: Experiential Luxury Spending

Luxury Dining — Purchase Details

Amount Spent on Luxury Dining

Key Influencers for Dining Purchases

• Figure 32: Fine Dining Key Influencers for Purchase (2Q2006 Luxury
Tracking)

Luxury Entertainment — Purchase Details

Amount Spent on Luxury Entertainment

Key Influencers for Entertainment Purchases

• Figure 33: Entertainment Key Influencers for Purchase (2Q2006 Luxury
Tracking)

Luxury Home Services — Purchase Details

Type of Home Services

• Figure 34: Type of Home Services Bought

Amount Spent on Luxury Home Services

Key Influencers for Home Services Purchases

• Figure 35: Home Services Key Influencers for Purchase (2Q2006 Luxury
Tracking)

Luxury Spa, Massage and Beauty Treatment — Purchase Details

Amount Spent on Luxury Spa, Massage and Beauty Treatment

Key Influencers for Spa & Beauty Treatments Purchases

• Figure 36: Spa and Beauty Services Key Influencers for Purchase (2Q2006
Luxury Tracking)

Luxury Travel — Purchase Details

Amount Spent on Luxury Travel

Foreign Travel Choices

• Figure 37: Type of Foreign Travel Bought

Domestic Travel Choices

• Figure 38: Type of Domestic Travel Bought

Key Influencers for Travel Purchases

• Figure 39: Travel Key Influencers for Purchase (2Q2006 Luxury Tracking)

Chapter 4 — About Butterflies & Other Segments in Luxury Market

• Figure 40: Atttitudes about Luxury

Segmentation Analysis of Luxury Market — Four Segments Identified in Luxury Market

• Figure 41: Luxury segmentation analysis mean values

Butterflies Emerge as Largest Luxury Consumer Segment

• Figure 42: Field Guide to the Luxury Personalities

Luxury Cocooners are Still Enveloped in Their Luxury Cocoons

Cocooners Spend More on Home and Home-Focused Experiential Luxuries

Butterflies Have Emerged from Their Luxurious Cocoons

Butterflies Spend Freely on Luxury

Luxury Aspirers Have not yet Reached the Level of Luxury to Which They Aspire

Aspirers Don't Spend as much on Luxury

X-Fluents Live the Lifestyle of the ‘Rich and Famous’

X-Fluents Spend More on Luxury

Chapter 5 — About Luxury Consumers and Their Likelihood to Purchase Luxury vs

Ordinary Goods and Services

Majority of Luxury Consumers Trade Down Not Up to Luxury

Majority of luxury consumers trade down most often

• Figure 43: Purchase Luxury Regularly, Occasionally, Rarely by

Product/Service Category

Ability to Spend for Luxury Doesn’t Translate into Willingness to Spend

• Figure 44: How Often Super-Affluent Luxury Consumers Indulge in Luxury

Chapter 6 — Luxury Consumers & the Internet

Luxury Internet Shoppers

Internet Widely Used to Research and Purchase

• Figure 45: Luxury Consumers' Use of the Internet

Entertainment and Recreation Lead Internet Purchases

• Figure 46: Kinds of Products and Services Bought on the Internet

Super-Affluents Lead the Internet Spending Pack

• Figure 47: Average Spending on All Goods & Services over the Internet

Typical Luxury Consumers Spends about 5 Hours a Week Shopping Online

• Figure 48: Average Number of Hourse Used for Interent Shopping/Research on
a Weekly Basis

Typical Luxury Consumers Spends about 13 Hours Per Week Online for Non-Shopping Purposes

• Figure 49: Luxury Average Number of Hours Used on Internet for All Other
Purposes Besides Shopping Weekly

Convenience and Comparison Key to Internet Shopping

• Figure 50: Features Luxury Shoppers Consider Very Important for Using the
Internet for Shopping

Shipping and Handling Charges Discourage Luxury Internet Shoppers

Luxury Consumers’ Attitudes about Internet Shopping

• Figure 52: Attitudes of Luxury Shoppers about Internet Shopping

Chapter 7 — Luxury Gifting

Introduction

Luxury Gift Spending

• Figure 53: Luxury Consumers' Gift Giving Spending by Demographic
Segment, 4Q2005

Holiday Gift Lists Number 12 People

• Figure 54: Number of People on Christmas Gift List

Entertainment & Recreational Items and Clothing & Fashion Accessories Tops Luxury Gifters’
Gift Lists

• Figure 55: Types of Gifts Purchased

Department Stores, both Discounters and Traditional, Were Their Favorite Place to Shop for Gifts,
with Electronics Stores Very Close Second Choice

• Figure 56: Where Luxury Consumers Shopped for Holiday Gifts 2005

Luxury Gifters’ Gifting Trends

• Figure 57: Trends in Luxury Gifting

Luxuries as Gifts Holiday 2005

• Figure 58: Luxury Purchase Incidence & Percent Bought As Gifts

Christmas Gift Plans 2006

Luxury Consumers Plan on Spending Just Under $2,000 on Christmas Gifts This Year

• Figure 59: Planned Christmas Gift Spending 2006

Christmas Gift Spending by Demographic Segment

• Figure 60: Planned Christmas 2006 Gift Spending by Demographic Segments

When Luxury Consumers Started or Will Start Christmas Shopping for 2006

• Figure 61: When Luxury Consumers Started or Will Start Christmas 2006
Shopping

Number of People on Luxury Consumers’ Gift Lists

• Figure 62: Number of People on Luxury Consumers' Gift Lists compared with
All Consumers

Gift Categories Luxury Consumers Are Very Likely to Purchase for Christmas 2006

• Figure 63: Gift Categories for Christmas 2006

Likelihood to Purchase Luxury Versions of Gift Categories

• Figure 64: Likelihood to Purchase More Luxurious Version vs. Ordinary,
Everyday Version

Where Luxury Consumers Will Shop for Christmas 2006 Gifts

• Figure 65: Stores Where Luxury Consumers Are Very Likely to Shop for
Christmas 2006 Gifts

Trends in Luxury Consumers’ Christmas Gifting 2006

• Figure 66: Trends in Christmas 2006 Gifting

Chapter 8 — About Luxury Travel

Nearly Four Trips Planned For April to December 2006

• Figure 67: Travel Plans April-December 2006

Luxury Resort and Foreign Travel Top List for Personal Vacation Plans

• Figure 68: Type of Personal Trips Planned

Travel Spending Trends, 2005 to 2006

• Figure 69: Trends in Luxury Travel, 2005 to 2006

Relaxation and Stress Relief Is Primary Experience Desired by Luxury Travelers

• Figure 70: Travel Experiences Rated Very Important by Luxury Travelers

Having Special Experiences that Make Memories Is Top Factor when Planning Travel

• Figure 71: Factors Rated Very Important When Planning Luxury Travel

Chapter 9 — About Influencers and Motivators for Luxury Purchases

Luxury Consumers Just Want to Have Fun

• Figure 72: Motivators Rated Very Important When Purchasing Luxury

Happiness Is the Ultimate Luxury

People have a happiness ‘set point’ that is resistant to change

Money doesn’t buy happiness, in fact the pursuit of wealth may make people less, rather than

more happy

Influencers of Most Importance When Buying Experiential Luxuries

• Figure 73: Influencers Rated Very Important in Most Recent Experiential
Luxury Purchases

Chapter 10 — Status & the Luxury Consumers

Attitudes about Status

• Figure 74: Attitudes about Status

Personalities of Status

• Figure 75: Personalities of Status

• Figure 76: Status Personalities Attitudes

Consensus Connie Goes Along with the Status Quo

Sarah the Status Seeker Places a Priority on Prestige

Quality Magnet Martha Is Driven to Buy the Best

Anti-Status Andy Rejects the Trappings of Status

Lifecycle of Luxury Brands’ Status Tied to Consumers’ Age

• Figure 77: Status Attitudes Most Closely Associated with Younger Consumers

• Figure 78: Anti-Status Attitudes Most Closely Associated with Older Luxury
Consumers

Maintaining Luxury Consumers’ Desire for Status Through the Acquisition of Luxury Is Good for

Luxury Marketers

Counter Trend toward Anti-Status Is Taking Hold

Appendix A

Research Objectives

Research Methodology

Income Demographics

• Figure 79: Income Demographics

Gender

Age Distribution

• Figure 80: Age Distribution

Other Demographic Variables

Survey Questionnaires

Abstract

Unity Marketing's Experiential Luxury Report 2007 is the definitive study of the luxury consumers' buying and spending preferences, written by Pam Danziger, the nation's leading expert on the 'new luxury' market.

This report provides vital market size, growth and demographics for anyone and everyone that sells luxury, from marketers, advertisers, retailers, service providers. The Experiential Luxury Report 2007 is an essential tool to understand the dynamics of the luxury market, today and into the future.

This important new study of the luxury market provides the results of a two-year longitudinal research study of the luxury market conducted quarterly. This report is compiles detailed statistics collected in eight waves of Unity's quarterly Luxury Tracking surveys during 2005 and 2006. In both years over 4,000 luxury consumers were surveyed. The average income of respondents in 2006 was $149,800 and the gender distribution was 62 percent female and 38 percent male. The average age of respondents was 43.1 years, with 50 percent of respondents being Baby Boomers and 36 percent being GenXers.

Details about services included in Experiential Luxury Report 2007

Details about what these luxury consumers bought, how much they spent, where they made their purchases, and in certain categories the luxury brands they patronized are reported. Significantly more product categories and more brands were included in the 2006 Luxury Tracking surveys, notably:

Experiential Luxuries

• Dining
• Entertainment
• Home Services (House cleaning/maid; lawn care; landscaping; party planning/catering; home decorator/designer; pet care; pool maintenance)
• Spa, Massage, Beauty and Cosmetic Services
• Travel (Foreign and domestic luxury hotels, commercial air, resorts, cruises, group tours, adventure travel, private air travel)

Now you can make critical business decisions based upon facts - not beliefs, assumptions or fantasies

This report provides the facts and figures you need to develop winning marketing and business strategies. By working with the facts, not fantasies, you have a much better chance of success marketing to the luxury consumers. This report gives you a horizontal view of the luxury market, recognizing that luxury marketers compete not just with companies within their vertical product niche, but across all luxury categories as well.

Within each category of luxury, the key drivers for purchase are studied, such as role of luxury brand in purchase decision; the influence of sales price on purchase; where the shopper bought their last luxury; why they bought luxuries; whether their luxury purchases were made a gifts; and other motivational factors.

Special feature: Find out which of the four different types of luxury consumers are your best customers

A special feature in Unity Marketing's Experiential Luxury Report 2007 is a psychographic profile of the four key types of luxury consumers. These include:

• X-Fluents (Extremely Affluent) who spend the most on luxury and are most highly invested in luxury living;
• Butterflies, the most highly evolved luxury consumers who have emerged from their luxury cocoons with a passion to reconnect with the outside world. Powered by a search for meaning and new experiences, the butterflies have the least materialistic orientation among the segments, yet they spend nearly as much as the X-Fluents on luxury;
• Luxury Cocooners who are focused on hearth and home. They spend most of their luxury budgets on home-related purchases;
• Aspirers, those luxury consumers who have not yet achieved the level of luxury to which they aspire. They are highly attuned to brands and believe luxury is best expressed in what they buy and what they own.

Get Full Details About This Report >>

About MarketResearch.com
MarketResearch.com is an online aggregator selling over 160,000 market research reports, company profiles and country profiles from over 600 research firms. Our reports will provide you with the critical business and competitive intelligence you need for strategic planning and marketing research. Coverage includes the US, UK, Europe, Asia and global markets.