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An Inside Look at theAn Inside Look at the Affluent MarketAffluent Market
Presented by
J.D. Roumeliotis
www.affluencemarketing.ca
1
JD Roumeliotis affluence marketing
AFFLUENT DEMOGRAPHICS
Median age 47 (boomer)
3.25 people/household
Own their home
37% have other
residential real estate
(second home)
Fairly even geographic
distribution
Source: Defining Luxury by Laurie Moore-Moore 2
 Golfers (71%)
 Attend the theatre,
ballet or opera (71%)
 Play tennis or
racquet sports (40%)
JD Roumeliotis affluence marketing
AFFLUENTS’ HOBBIES
Sample: Home value of $2.5 million
Super Rich Still Spending Despite Less Than Robust Economy 11/6/03
3
• Home electronics $1000+ (84%)
• Gourmet restaurant dining
(83%)
• Fine art, oriental carpets or
antiques $1000+ (81%)
• Jewelry $1000+ (68%)
• Vacation travel abroad (65%)
• Paying a child or grandchild’s
private school tuition (62%)
• Wine/champagne by the case
(54%)
• Car $50,000+ (49%)
JD Roumeliotis affluence marketing
AFFLUENTS’ INTEREST
Sample: Home value of $2.5 million
Super Rich Still Spending Despite Less Than Robust Economy 11/6/03 4
o Can’t rely only on
demographics to
describe
the affluent
o Need to understand
their common mindset
JD Roumeliotis affluence marketing
DEFINING THE AFFLUENT MINDSET
5
Comfort Class
When asked to describe their financial
status, consumers said:
Upper Middle Class 38%
Comfortable 30%
Middle Class 15%
Well off 8%
Affluent 7%
Wealthy 3%
JD Roumeliotis affluence marketing
MINDSET DEFINITION
Frugal Elite
Self-made millionaires in their 30’s,
40’s and early 50’s
“It’s no longer chic to have paid too
much.” Today, consumers want more
for their dollar.
For example, luxury consumers are
shopping at Target as well as Saks
and Neiman Marcus
Source: Traditional Homes 6/04; $150,000+ income Source: New York Times 1/03
6
They define luxury on their own terms:
Luxury = Freedom
Freedom = Comfort + Confidence
JD Roumeliotis affluence marketing
CONSUMER DEFINITION OF LUXURY
7
• Affluent Americans like the luxury lifestyle but
reject the luxury label
• Only 2% described lifestyle as luxurious and
only 5% said luxury goods make them feel
elite
• Instead, they commonly described
themselves as family-oriented (71%), casual
(41%), and traditional (36%)
JD Roumeliotis affluence marketing
THE AFFLUENT REJECT THE LUXURY LABEL…
Source: San Diego Union-Tribune Nov, 03
8
For many, luxury conjures
up images of just the type
of behavior they want to
avoid
 Elitism
Stuffiness
Snobbery
Instead, they feel money
affords –
 Independence
Security
Comfort
JD Roumeliotiaffluence marketing
…BECAUSE, THEY CLAIM, IT DOESN’T REFLECT THEM
Source: San Diego Union-Tribune Nov, 03
9
Percentage saying luxurious describes home or
lifestyle:
 Home 23%
 Lifestyle 16%
“They do not view luxurious as a descriptor of their
home or lifestyle. Instead, they view purchases and
tastes as important building blocks in their lives and
expressions of priorities, not as frivolous luxuries.”
JD Roumeliotiaffluence marketing
…AND THEY DON’T VIEW LIFE AS LUXURIOUS
Source: Traditional Homes 6/04
$150,000+ annual income
10
• Luxury is no longer
about rampant
materialism or getting
that new gadget or
thing to display
• Instead it is the
enjoyment and
experiences that
money can buy.
JD Roumeliotis affluence marketing
ENJOYING THE EXPERIENCE
Source: Chain Store Age Feb, 04
11
 The current view of
the affluent is that
they’re rooted in
values rather than
badges.
 They are more
enlightened, less
materialistic luxury
consumers
JD Roumeliotiaffluence marketing
THEY FEEL THAT VALUES ARE IMPORTANT
Sources: Ad Week Sept, 04
Luxury Brands, 2004
12
What do your luxury purchases reflect about you?
JD Roumeliotiaffluence marketing
THEIR PURCHASES REPRESENT THEMSELVES
0% 5% 10% 15% 20% 25% 30% 35% 40%
My social status
My sophistication
My place in the world
My fashion-forward style
My connoisseurship
My true nature
My personal accomplishments
My discerning tastes
My lifestyle
My personal style
13
Luxury consumers also
look for outstanding
quality, high performance,
being well worth the
price, etc.
“Don’t tell me it’s status,
don’t tell me it’s a label,
tell me how it’s better.”
So who is buying luxury
goods today?
JD Roumeliotiaffluence marketing
THEY DON’T BUY BASED ON BRAND ALONE
Source: Ad Week Sept, 04
14
Luxury consumers
are very diverse and
are coming in from all
points of entry.
JD Roumelioti affluence marketing
LUXURY CONSUMERS ARE EVERYWHERE
Source: Ad Week Sept, 04
15
“Affluent consumers are just as likely to shop with
the ‘masses’ at Wal-Mart or Target/Zellers as
they are to frequent Madison
Avenue/Sherbrooke W. boutiques with the
‘classes’.”
“Discounters like Costco and Wal-Mart’s low
prices allow customers to save money on some
items so they can spend more money on
others.”
JD Roumeliotisaffluence marketing
THEY SHOP ‘MASS’ & ‘CLASS’
Sources: Unity Marketing Aug, 04
Financial Times June, 04
16
In categories that aren’t emotionally important,
consumers ‘trade down’ or become bargain hunters.
A passionate Mercedes driver will shop at Costco
every weekend
A construction worker who splurges on a $3,000 set
of Callaway golf clubs will buy store-brand groceries
JD Roumeliotisaffluence marketing
OCCASIONALLY, THEY ‘TRADE DOWN’
Source: Pacific Business News May, 04
17
In categories that are
emotionally important,
consumers ‘trade up’
and buy luxury
versions of the
products that matter
most to them.
JD Roumeliotisaffluence marketing
THEY ALSO ‘TRADE UP’
Source: Financial Times June, 04
18
“Consumers will spend a lot on their home, but
they don’t see it as consumption, they see it as
savings. They consider luxury cars safer and
worth the investment.”
JD Roumeliotis affluence marketing
THE AFFLUENT WILL RATIONALIZE WHEN THEY DO SPEND
Source: Luxury Marketing, Sept. 2006
19
JD Roumeliotis affluence marketing
IN SUMMATION
20
22
James D. Roumeliotis
author, lecturer, speaker & entrepreneurial practitioner/adviser
For my profile/background, kindly visit:
http://about.me/jdroumeliotis
My blog: www.unconventionalbusinesswisdom.org
Twitter: @jdroumeliotis
I encourage you to send me your questions and thoughts at:
jdr@affluencemarketing.ca

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Affluent Market presentation

  • 1. An Inside Look at theAn Inside Look at the Affluent MarketAffluent Market Presented by J.D. Roumeliotis www.affluencemarketing.ca 1
  • 2. JD Roumeliotis affluence marketing AFFLUENT DEMOGRAPHICS Median age 47 (boomer) 3.25 people/household Own their home 37% have other residential real estate (second home) Fairly even geographic distribution Source: Defining Luxury by Laurie Moore-Moore 2
  • 3.  Golfers (71%)  Attend the theatre, ballet or opera (71%)  Play tennis or racquet sports (40%) JD Roumeliotis affluence marketing AFFLUENTS’ HOBBIES Sample: Home value of $2.5 million Super Rich Still Spending Despite Less Than Robust Economy 11/6/03 3
  • 4. • Home electronics $1000+ (84%) • Gourmet restaurant dining (83%) • Fine art, oriental carpets or antiques $1000+ (81%) • Jewelry $1000+ (68%) • Vacation travel abroad (65%) • Paying a child or grandchild’s private school tuition (62%) • Wine/champagne by the case (54%) • Car $50,000+ (49%) JD Roumeliotis affluence marketing AFFLUENTS’ INTEREST Sample: Home value of $2.5 million Super Rich Still Spending Despite Less Than Robust Economy 11/6/03 4
  • 5. o Can’t rely only on demographics to describe the affluent o Need to understand their common mindset JD Roumeliotis affluence marketing DEFINING THE AFFLUENT MINDSET 5
  • 6. Comfort Class When asked to describe their financial status, consumers said: Upper Middle Class 38% Comfortable 30% Middle Class 15% Well off 8% Affluent 7% Wealthy 3% JD Roumeliotis affluence marketing MINDSET DEFINITION Frugal Elite Self-made millionaires in their 30’s, 40’s and early 50’s “It’s no longer chic to have paid too much.” Today, consumers want more for their dollar. For example, luxury consumers are shopping at Target as well as Saks and Neiman Marcus Source: Traditional Homes 6/04; $150,000+ income Source: New York Times 1/03 6
  • 7. They define luxury on their own terms: Luxury = Freedom Freedom = Comfort + Confidence JD Roumeliotis affluence marketing CONSUMER DEFINITION OF LUXURY 7
  • 8. • Affluent Americans like the luxury lifestyle but reject the luxury label • Only 2% described lifestyle as luxurious and only 5% said luxury goods make them feel elite • Instead, they commonly described themselves as family-oriented (71%), casual (41%), and traditional (36%) JD Roumeliotis affluence marketing THE AFFLUENT REJECT THE LUXURY LABEL… Source: San Diego Union-Tribune Nov, 03 8
  • 9. For many, luxury conjures up images of just the type of behavior they want to avoid  Elitism Stuffiness Snobbery Instead, they feel money affords –  Independence Security Comfort JD Roumeliotiaffluence marketing …BECAUSE, THEY CLAIM, IT DOESN’T REFLECT THEM Source: San Diego Union-Tribune Nov, 03 9
  • 10. Percentage saying luxurious describes home or lifestyle:  Home 23%  Lifestyle 16% “They do not view luxurious as a descriptor of their home or lifestyle. Instead, they view purchases and tastes as important building blocks in their lives and expressions of priorities, not as frivolous luxuries.” JD Roumeliotiaffluence marketing …AND THEY DON’T VIEW LIFE AS LUXURIOUS Source: Traditional Homes 6/04 $150,000+ annual income 10
  • 11. • Luxury is no longer about rampant materialism or getting that new gadget or thing to display • Instead it is the enjoyment and experiences that money can buy. JD Roumeliotis affluence marketing ENJOYING THE EXPERIENCE Source: Chain Store Age Feb, 04 11
  • 12.  The current view of the affluent is that they’re rooted in values rather than badges.  They are more enlightened, less materialistic luxury consumers JD Roumeliotiaffluence marketing THEY FEEL THAT VALUES ARE IMPORTANT Sources: Ad Week Sept, 04 Luxury Brands, 2004 12
  • 13. What do your luxury purchases reflect about you? JD Roumeliotiaffluence marketing THEIR PURCHASES REPRESENT THEMSELVES 0% 5% 10% 15% 20% 25% 30% 35% 40% My social status My sophistication My place in the world My fashion-forward style My connoisseurship My true nature My personal accomplishments My discerning tastes My lifestyle My personal style 13
  • 14. Luxury consumers also look for outstanding quality, high performance, being well worth the price, etc. “Don’t tell me it’s status, don’t tell me it’s a label, tell me how it’s better.” So who is buying luxury goods today? JD Roumeliotiaffluence marketing THEY DON’T BUY BASED ON BRAND ALONE Source: Ad Week Sept, 04 14
  • 15. Luxury consumers are very diverse and are coming in from all points of entry. JD Roumelioti affluence marketing LUXURY CONSUMERS ARE EVERYWHERE Source: Ad Week Sept, 04 15
  • 16. “Affluent consumers are just as likely to shop with the ‘masses’ at Wal-Mart or Target/Zellers as they are to frequent Madison Avenue/Sherbrooke W. boutiques with the ‘classes’.” “Discounters like Costco and Wal-Mart’s low prices allow customers to save money on some items so they can spend more money on others.” JD Roumeliotisaffluence marketing THEY SHOP ‘MASS’ & ‘CLASS’ Sources: Unity Marketing Aug, 04 Financial Times June, 04 16
  • 17. In categories that aren’t emotionally important, consumers ‘trade down’ or become bargain hunters. A passionate Mercedes driver will shop at Costco every weekend A construction worker who splurges on a $3,000 set of Callaway golf clubs will buy store-brand groceries JD Roumeliotisaffluence marketing OCCASIONALLY, THEY ‘TRADE DOWN’ Source: Pacific Business News May, 04 17
  • 18. In categories that are emotionally important, consumers ‘trade up’ and buy luxury versions of the products that matter most to them. JD Roumeliotisaffluence marketing THEY ALSO ‘TRADE UP’ Source: Financial Times June, 04 18
  • 19. “Consumers will spend a lot on their home, but they don’t see it as consumption, they see it as savings. They consider luxury cars safer and worth the investment.” JD Roumeliotis affluence marketing THE AFFLUENT WILL RATIONALIZE WHEN THEY DO SPEND Source: Luxury Marketing, Sept. 2006 19
  • 20. JD Roumeliotis affluence marketing IN SUMMATION 20
  • 21.
  • 22. 22
  • 23. James D. Roumeliotis author, lecturer, speaker & entrepreneurial practitioner/adviser For my profile/background, kindly visit: http://about.me/jdroumeliotis My blog: www.unconventionalbusinesswisdom.org Twitter: @jdroumeliotis I encourage you to send me your questions and thoughts at: jdr@affluencemarketing.ca