SOURCE: Unity Marketing

April 27, 2011 10:52 ET

Unity Marketing's Forward-Looking LCI Signals Improved Prospects for Luxury Market in Second Quarter 2011

Yet, Despite Their Improved Confidence, Luxury Consumers Kept Their Spending Flat in First Quarter 2011

STEVENS, PA--(Marketwire - Apr 27, 2011) - Mixed signals: that is what the latest Unity Marketing quarterly survey of affluent consumer confidence delivered for the first six months of 2011. (www.unitymarketingonline.com)

  • On a positive note, the Luxury Consumption Index (LCI) rose 6.7 points, the highest rate of growth since first quarter 2010, to reach 82.8 points. However, today the LCI still stands below its highest post-recession level of 86.9 points it reached in the January 2010.

  • Tempering luxury marketers' enthusiasm for the return of the luxury consumer market is the fact that spending on luxury by the affluent consumers surveyed was basically flat from previous quarter and 4.1 percent less than reported in the first quarter 2010.

Commenting on the conflicting results of Unity Marketing's latest Luxury Tracking Survey conducted April 6-13, 2011 among 1,321 luxury consumers (avg. income $287.2k; median net wealth $897k; age 45 years; men 45 percent & women 55 percent), Unity Marketing's president Pam Danziger and author of Putting the Luxe Back in Luxury says, "There is a lot of 'noise' out there about the return of the luxury market. I am advising my clients not to believe everything they see or hear."

Danziger continues, "While the worst may be behind us, there are still worrisome trends brewing in the market for luxury. For example, the rate of change in luxury consumers' spending peaked between the second and third quarter 2009. Since then the rate of change has steadily slowed, which indicates that much of the pent up demand for luxury goods that built during the worst of the recession has already been released. Spending on luxury is likely to flatten out over the coming quarters unless there is dramatic improvement in the economy overall, which seems doubtful."

Commenting on the latest luxury consumer survey results, Tom Bodenberg, Unity Marketing's chief consumer economist, said, "This quarter's rise in the LCI but with luxury consumer spending flat lining at the same time, signifies a great deal of uncertainty and market demand volatility. The rise in the LCI (highest in the past 12 months) reflects a noted reduction in market pessimism. However, this has yet to FULLY translate into increased demand. While there is a slight yet continuous increase in the index over the past 12 months, increase in the rate of growth of the index will not pick up unless there is a sustained economic recovery."

For a copy of the latest LCI or more information about the latest Luxury Consumer Tracking Study, please call Pam Danziger at 717-336-1600 or email to pam@unitymarketingonline.com

About Unity Marketing's Luxury Tracking Study

Launched in January 2004, and every three months thereafter, Unity Marketing has measured the pulse of the affluent consumers in a longitudinal survey of 1,200+ affluent consumer households. One-third of each survey is comprised of ultra-affluents (HHI $250,000 and above).

Each quarter the Luxury Consumer Tracking Study reports what luxuries they bought during the past quarter, how much they spent, where they bought, the luxury brands they became aware of and used, and how they felt about their current and prospective financial status. A total of 22 major categories of luxury goods and services are included in the poll, including clothing, fashion accessories, home luxuries, travel, dining and jewelry.

Based upon the results of the survey, Unity Marketing also publishes a Luxury Consumption Index which tracks how luxury consumers feel and helps marketers anticipate consumers spending in the coming quarters.

Visit www.unitymarketingonline.com to learn more.

About Pam Danziger and Unity Marketing

Pamela N. Danziger is an internationally recognized expert specializing in consumer insights for marketers targeting the affluent consumer. She is president of Unity Marketing, a marketing consulting firm she founded in 1992. Pam received the Global Luxury Award for top luxury industry achievers presented at the Global Luxury Forum in 2007 by Harper's Bazaar.

Pam gives luxury marketers "All Access" to the mind of the luxury consumer. She uses qualitative and quantitative market research to learn about their brand preferences, shopping habits, and attitudes about their luxury lifestyles, then turns these insights into actionable strategies marketers can use to reach these high spending consumers. Unity Marketing is the voice of the luxury consumer for such clients as PPR, Diageo, Tempur-Pedic, Google, Swarovski, Constellation Wines, Ford Motor Company, Luxottica, Orient-Express Hotels, Italian Trade Commission, Marie Claire magazine, The World Gold Council, and The Conference Board.

She is author of Putting the Luxe Back in Luxury (Paramount Market Publishing, 2011). Her other books include Shopping: Why We Love It and How Retailers Can Create the Ultimate Customer Experience, published by Kaplan Publishing in October 2006; Let Them Eat Cake: Marketing Luxury to the Masses -- as well as the Classes, (Dearborn Trade Publishing, $27, hardcover) and Why People Buy Things They Don't Need: Understanding and Predicting Consumer Behavior (Chicago: Dearborn Trade Publishing, 2004).

Contact Information

  • Contact:
    Pam Danziger
    717-336-1600