Buying luxury goods is not necessarily about the actual item itself, the appeal is often in the experience surrounding the purchase. Often what distinguishes the experience of purchasing luxury items is the personalised service wealthy consumers receive from a known and trusted sales person.
A recent eMarketer report entitled The Luxury Consumer: Shoppers Lead Brands to Digital Channels examined how the exclusivity a brand offers customers, whether it is limited edition merchandise or personalised service, can be translated into the digital realm.
Luxury brands have not, generally, kept up with digital, but that seems to be changing according to the eMarketer report. It found affluent consumers in the United States (those with household incomes of more than $100,000 per year) are spending a significantly larger amount of time online. In 2011 a study found people with these incomes spent an average of 32.8 hours per week online; this year that figure had jumped to 41.6 hours per week, an increase of nearly one quarter.
And the amount of time online is directly correlated with the amount of spending online – the average spending on luxury sites was up by 20 per cent on 2012 according to the report.
In a May 2013 Luxury Institute survey of American consumers who made more than $150,000 per annum, it was found high-earners were about as likely to have made a purchase at a physical store in the last 12 months, as they were to have bought something online.
Interestingly, despite the rising popularity of online shopping, the survey found research done online led to in-store purchases in 45 per cent of respondents. Only 25 per cent of wealthy consumers made purchases online after visiting a physical store.
“Successful brands turn shopping and browsing into a seamless experience across traditional websites, apps for smart phones and tablets, and within brick-and-mortar stores,” Luxury Institute CEO Milton Pedraza said. “Wealthy consumers are eager users of the latest technologies and brands need to be, too.”
Another survey of wealthy consumers conducted by American Express Publishing and Harrison Group in early 2013 found 48 per cent of those with a yearly income of more than $100,000 said they discovered new luxury items online, almost equivalent to the 50 per cent of respondents who said they discovered new products while shopping at a physical store. So, while these consumers are still making more purchases in a physical store, they are discovering new items online, and being exposed to more marketing in the digital realm.