April 26, 2013
Eighty percent of affluent consumers own at least one type of mobile device and more than 53 percent own two or more, according to a new study by the American Affluence Research Center.
The “Spring 2013 Affluent Market Tracking Study” found that affluent consumers enjoy being connected online and the consumers who research products online are more likely to purchase them. This means that luxury marketers should increase their online and mobile presence to keep up with their connected target consumers.
“Mobile devices - both smartphones and tablets - play many roles for affluent consumers,” said Ron Kurtz, president of the American Affluence Research Center, Atlanta.
“Mobile devices are a means of communication in various forms, a source of entertainment, a source of knowledge, a convenience for research and purchases of products, and a place to store data, photos and videos,” he said.
“Mobile offers great potential as a relatively low-cost and effective method for communicating with consumers, and in some situations, it can be an enabler of sales.”
The Spring 2013 Affluent Market Tracking Study is based on a projectable national sample of 463 respondents representative of United States households with a minimum of $800,000 net worth. The respondents reported an average income of $309,000 per year and average net worth of $3.1 million. The average value of their primary residence is $1.2 million.
Out of those respondents who own smartphones, the iPhone was named more than twice as often as the combined total of Android, BlackBerry and other devices.
For those who own tablets, the iPad was named five times more than the combined total of Android tablets and other brands.
The affluent consumers who own two or more mobile devices are most likely males under age 59 with an annual income of more than $200,000.
Even though affluent consumers are very connected through mobile devices, luxury marketers should consider their target audience’s goals and their products before jumping into mobile-commerce efforts.
“The importance of mobile to marketers depends on many factors, including the type of product, the frequency of purchase of the product, the price points of the product, whether the product is a highly considered or researched purchase and the type of relationship that exists between the business and the consumer,” Mr. Kurtz said.
“Luxury marketers can always improve their mobile efforts by being responsive to change in consumer expectations, technology and actions of competitors,” he said.
Lanvin's recently updated mobile commerce site
In addition, affluent consumers are also connecting through social media and the Internet.
Seventy-two percent of affluent consumers who have access to the Internet regularly participate in social media. Most of these consumers are active on Facebook or LinkedIn.
Out of these consumers, 47 percent subscribe to receive regular communications from a marketer.
Also, 88 percent of these consumers said they went online to research or purchase a product in the last year.
The number of consumer purchases made in-store during the past year is approximately the same as the number of purchases made online via a computer in the past year.
The study also found that when consumers did online research, they were more likely to make a purchase.
Additionally, the new Affluent Market Tracking Study found that affluent consumers are optimistic about their future and intend on spending more in the near future.
More than 75 percent of affluent consumers expect their net worth to be the same or higher in a year’s time, while 60 percent expect their income to be the same or higher.
Also, affluent consumers are more optimistic about the future than the general public.
“Most of the affluent will maintain their spending despite higher income taxes and some concern about business conditions and the economy,” Mr. Kurtz said.
“This is good news for businesses marketing to the affluent and represents a more positive attitude than that of the general public, as evidenced by the Conference Board’s Consumer Confidence Index, the weekly Gallup Economic Confidence research, and other research of the general public,” he said.
“It is a good contrast with the overall .4 percent decline in total retail spending reported by the Commerce Department for March.”
This will benefit luxury marketers since their target audience is likely to continue spending.
“The continued spending of the affluent is good news for luxury marketers, who should continue to focus their marketing efforts on the consumers who can appreciate and afford their products,” Mr. Kurtz said.
Erin Shea, editorial assistant on Luxury Daily, New York