Recession has changed the U.S. luxury market, and so the people have changed as well. The Luxury Institute, an organization that conducts extensive and actionable research with wealthy consumers about their behaviors and attitudes on customer experience best practices, recently conducted an in-depth online survey with 1,216 affluent U.S. consumers in cooperation with the Lincoln Motor Company.
The survey asked wealthy luxury automobile consumers to share their opinions, which may have altered since the recession, about buying considerations and luxury spending across a variety of product categories.
Superior craftsmanship, materials and customer service scored highest in terms of helping to define the luxury market while driving premium pricing. Additionally, survey respondents overwhelmingly favored a long-lasting, high quality product over one that merely enhanced status.
"High standards for the tangible quality of goods are to be expected from such refined buyers," Milton Pedraza, chief executive officer at Luxury Institute, said in a statement.
When it comes to what drives luxury and justifies premium pricing, 86 percent of affluent Americans surveyed said that superior craftsmanship is the deciding quality. Nearly as many (84 percent) said they also expect the use of superior materials in luxury products. The third most important consideration, cited by 76 percent of wealthy respondents, is a "superior” customer experience both during and after the sale.
A majority of wealthy consumers report enjoying their luxury purchases discreetly versus proudly showing their purchases to others. In addition, more than 90 percent indicate that acquiring a long-lasting, high quality product is more important than enhancing their status.
Jim Farley, executive vice president of Ford Motor Company (News - Alert) global marketing, sales and service, Lincoln, said that customers want what appeals most to their desires and not what they believe will impress others and this is a trend we believe will continue to grow ever stronger.
Other survey results highlighted the fact that half of high-income shoppers rely on user reviews and the recommendations of family and close friends, enabling quick sharing of opinions and influence. These top-two influencers of luxury consumers' purchase decisions demonstrate how relative newcomers can quickly establish brands that compete with established stalwarts, and how traditional brands can reinvigorate themselves via digital media.
"What we hear consistently and loudly from wealthy consumers is that the manner in which the goods are sold, as well as the service provided after the sale, are nearly as important as the products themselves. With American brands growing in luxury influence, there is a clear eagerness on the part of the global consumer to embrace American luxury brands, making service a critical success factor for the future," added Milton.
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Edited by Brooke Neuman