STORES 2015 BIG Show Daily - January 12, 2015 - (Page 12)
Luxury Market Broad,
Diverse and Growing
ow more than ever, nothing about
luxury is "one-size-fits-all." Today's
luxury consumers are a varied bunch,
ranging widely in ethnicity, in attitudes about
ownership versus use and even in how they
want to interact with retailers and brands.
But they provide enormous opportunity: The
global luxury market continues to grow by 10
Panelists (l-r) Ken Nisch, David Selinger and
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million people annually.
A Sunday morning session, "The
Changing World of Luxury Retailing,"
considered the way luxury has morphed
from two or three archetypal customers
to its current state. It featured Ken Nisch,
chairman of JGA; David Selinger, CEO
and co-founder of RichRelevance; and
Matthew Woolsey, executive vice president
of Barneys New York.
The shift is due in part to the rise of
Millennials (those born since 1980), who
have education levels and incomes that are
typically higher than the national averages.
Then there are the HENRYs - "High
Earners Not Rich Yet," as identified by
Unity Marketing. They have a base income
of $100,000; ultra-affluent consumers
make at least $250,000. In the United
82% more likely to use
smartphone than speak
with a sales associate
says RichRelevance CEO
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States, there are roughly 21.6 million
HENRY households, and 2.9 million ultras.
So why does it matter? Figuring out
how to reach those HENRYs now may
help build relationships for the long term.
Beyond that, there's much opportunity
for engaging those who want the lifestyle
but still can't make the investment. In the
luxury car market, for example, 50 percent
of vehicles are now being leased rather
than purchased, Nisch said.
From Woolsey's view, Millennials
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are "very naturally" luxury customers.
Again, that's not so much an indication
of having money to invest, but rather an
identification with the idea of themes like
story, authenticity and heritage. As such,
he said, personalization efforts "have to
be about more than how you deliver a
discount coupon. It has to be about story
- it has to be about engagement."
One of the biggest mistakes retailers
could make at this point, Selinger said, is to
think that the same technology being used
for the past five years will automatically
apply to this generation. More than making
the Internet simply a "big catalog," Millennials
are more interested in the where,
why and how, and that must be conveyed.
They're also interested in doing things
their own way: 82 percent of Millennials
are more likely to make a purchase decision
using their mobile phone than by speaking
with a sales associate. Therefore, Selinger
said, the way retailers engage at the point
of interaction has to change.
1/6/2015 8:39:34 AM
Table of Contents for the Digital Edition of STORES 2015 BIG Show Daily - January 12, 2015
STORES 2015 BIG Show Daily - January 12, 2015