April, 2013 – This article from Evins discusses the affluent using more e-commerce and not curtailing spending because of tax increases. (http://evins.com/aperture/?p=1643)
By Rachel Lamb
Recent data from the American Affluence Research Center has shown that the country’s most affluent consumers still intend to spend, despite tax increases. Furthermore, these consumers are increasingly using ecommerce, social media and mobile to spend – a clear indication that luxury marketers must execute innovative, aesthetically-pleasing digital campaigns to maximize relationship building, transactions and engagement.
Older wealthy consumers – a luxury brand’s core audience – have been slow to adapt to mobile marketing and new techniques such as social media. However, this interest in digital pursuits could indicate a huge untapped potential for high-end marketers. To keep especially these consumers coming back, marketers must ensure that their mobile and digital campaigns are interesting, beautiful and, overall, easy to use.
“The ownership and usage of mobile devices is widespread among all segments of the affluent. With relevant content and the right channels and technology, this can obviously be a powerful means of communicating to the affluent as well as the mass market,” said Ron Kurtz, president of American Affluence Research Center.
“The key finding is that most of the affluent will maintain their spending despite higher income taxes and some concern about business conditions and the economy,” he said. “This is good news for businesses marketing to the affluent and represents a more positive attitude than that of the general public.”
This report is based on the responses from 463 men and women. Their households have an average annual income of $309,000, an average net worth of $3.1 million, average investable assets of $1.8 million and an average primary residence value of $1.2 million.
Approximately 80 percent of affluent consumers own at least one smartphone, with 53 percent reporting owning two or more. The iPhone is named over twice as often than the combined total of Android, BlackBerry and other devices. Also, the iPad is named approximately five times more frequently than the combined total of other tablets.
Of those who own multiple mobile devices, more than half are under 59-years-old, male and with a $1.5 million net worth.
Meanwhile, an impressive 72 percent of affluent consumers are using social media, reporting Facebook as a slight favorite over LinkedIn. Those most likely to participate are under 50-years-old with a net worth of up to $6 million.
Many affluents, 41 percent, use two or more types of social media; the average is two social platforms. Around 47 percent of those who participate in social media subscribe to receive regular communications from brands, and 70 percent only subscribe to one outlet of social media. This presents a huge gap in communications between brands and consumers through this channel.
“Marketers should be sensitive to the fact that only about a third of the affluent, and even less of the affluent who are the true luxury consumers, are subscribing through social media to receive regular communications from a business. This indicates a vast untapped potential,” Mr. Kurtz said.
“The reasons for this need to be better understood in order to encourage the affluent to subscribe to receive such communications,” he said.
Consumers are also continuing to use other digital means to interact with brands. Approximately 88 percent of consumers went online to research or purchase a product during the past 12 months. Most-frequently-mentioned searches were non-business airline travel, lodging for non-business travel and books, movies and games.
Among the purchased items, the highest transaction rate on a computer was for non-business airline travel and lodging. Other than this, most searches were equal or greater than in-store purchases.
The study showed that when people did online research, they were very likely to make a purchase; when they did not research online, they were unlikely to make a purchase on that platform.
Marketers have been led to believe that older affluent consumers do not use online media for purchases, rather favoring the traditional in-store environment.
However, as technology progresses and media streamlines mobile devices and social media, it is clear that older affluents are also picking up these cues. It is not enough, though, to simply be on Facebook or have a mobile site (please, please get a mobile site).
As noted before, most affluents do not have subscriptions to brands on social media, which gives brands a big opportunity to have consumers follow them on Twitter, friend them on Facebook or download their app to further engage. Most marketers are already trying to grow their social presence, but they have mainly been focusing on younger consumers; this is understandable, since it’s been widely accepted that younger consumers are the ones who inhabit social media.
But as older affluents are getting more tech-savvy, brands must strive to get noticed on social media, mobile and digital channels; older consumers are their biggest fans, after all.