While examining today’s different industries, one can quickly realise that we live in a world full of choices; ones that enrich our everyday life by turning “needs” into “wants”; ones that also instigate every ambitious firm acumen to join the competitive game of business; and indeed, while we, as consumers, calmly browse through the different options, businesses do battle to grasp our attention and finally win us over as customers. So, what does it take for a company to achieve this goal? In the process of tackling this question, one stumbles on several parameters among which the following: a successful business must be aware of its target customers and their characteristics.
Focusing on the luxury industry, a global media and marketing services company came to shed light on this exact topic. In 2018, Mindshare North America surveyed sixteen hundred American luxury consumers above 18 years old. The survey outlined five types of luxury customers, with different age groups, motives, mindsets and habits. Carefully inspecting other or alike characteristics amongst the respondents, the global agency claimed that it is impossible to fit all luxury consumers in one big group. To this end, it provided an insightful classification into five main types of consumers. The categorization aims to offer luxury companies an insightful perspective regarding their customers’ preferences, expectations and needs.
To better understand each type of consumer, its characteristics and its differentiating factors, we will exemplify each by analyzing its perception for a luxury house.
24% of the survey respondents are Strivers, which means that they perceive luxury as evidence of their success. They love the idea of possessing luxury items more than the actual items per se. This is the youngest group, with an age range of 18-34, including the highest percentage of millennials and men (58%). Income wise, Strivers are mainly at the beginning of their careers, so they currently belong to the middle or upper-middle class; however, they are determined to work their way up to a wealthier status. They are driven to purchase luxury goods by social media influencers, family members and TV shows. When asked about their recent luxury purchases, they were most likely to have bought liquor, followed by fashion, auto, and travel.
For Strivers, having and living in a luxurious home a certification of their success. According to their ideals, every person should possess such a home. So, without needing to show it off, they derive pleasure from the thought that they’ve checked off one of their life goals.
16% of the survey respondents are Trendsetters. For them, having access to or possession of luxury items and services sets them apart from the crowd. This way, they feel differentiated and superior, which is their aim. This group has a similar age range and income to Strivers but has the highest percentage of multicultural consumers. Trendsetters’ purchases are driven by social media influencers, their friends and shopping websites. When asked about their recent luxury purchases, they were most likely to have bought fashion, followed by liquor, auto, and travel items.
Referring back to the home example, Trendsetters see a luxurious house as a means to impress or become the object of discussion. Owning the most expensive and elegant home in the neighbourhood is not necessarily enough for them if they can’t show it off. They want their property’s amenities to be visible, while they derive pleasure from their guests’ impressed reactions.
17% are considered Aesthetes and they define luxury as the pinnacle of aesthetics and design. This group marks the point at which the age range for luxury consumers raises, while it has the highest percentage of women at 62%. A third of the group has a yearly income between $100k-$149k, and the next majority earns over $150k. Their purchasing decisions are based on a company’s website, online reviews and personal research. They value craftsmanship and the way the brand associates itself in the industry. When asked about their recent luxury purchases, they were most likely to have bought travel, followed by auto, liquor, and fashion items.
Returning to our example, Aesthetes would prefer a house with curated artwork and design. They’re likely to hire architects and other professionals to maximize the element of beauty. They aspire to be surrounded by tasteful and harmonious colour palettes or carefully selected aesthetics that reflect their values.
Only the Best
23% are named Only the Best, and they see luxury as the highest level quality and service. They have several similarities to Aesthetes but are slightly older. With 28% of the group earning over $150k, they prioritize travel rather than auto, liquor and fashion items. Their purchasing decisions are influenced by personal research, online reviews and recommendations from friends. For them, the leadership and performance of a brand are essential, as is the product and experience received.
Only the Best don’t prioritize a house that looks luxurious but one that fundamentally is. They focus on the quality of the materials, furniture, location and overall ambience. Luxurious details would be necessary to them, such as specific marble elements or rare wood breed pieces. Components and materials that only one who is aware of their origin and characteristics can appreciate to the maximum.
19% fall under the category of Comfort First, who perceive luxury as a meaningful way of life. This group has the highest percentage of respondents aged over 65 years and see luxury as a way of life. This group also has the lowest amount of diversity, with 81% of them being white consumers. Comfort First consumers are the category with the highest percentage of individuals earning over $150k, at 35%. Comfort First consumers are influenced by online reviews and brand websites when making purchases. They spend more on travel, followed by auto, liquor and fashion items. They prefer when a brand highlights the comfort and ease of their service or product over its status and image.
Not paying particular attention to the aesthetic and luxurious feel of a house, Comfort First consumers value comfort and meaningfulness above all. They appreciate a lovely and high-quality home which raises their living standards. For them, however, raised living standards are not represented by over the top luxury or impressive designs. They would choose, for example, a nice view for their breakfast table to which they wake up every day and get inspired. Then, they would prefer a location for their house, so it is illuminated by sunlight for the better part of the day. One that is also surrounded by natural landscapes, so they breathe clean air.