Fewer Affluent Households Invested In Luxuries For Their Home Last Year, But Those Who Made Purchases Invested Significantly More

Unity Marketing's new Home Luxury Report details major changes in purchase of home luxuries and how marketers should respond.

 

In the category of home luxuries --  items for one's home, like art and antiques, garden and outdoor items, and linens and bedding -- 2009 was a rocky year.  Far fewer affluent consumers purchased items from this category, finds the new Home Luxury Report 2010 from Unity Marketing. However, those who made purchases spent on average 50 percent more than they spent on luxuries for their home in 2008.

 The latest report is based upon surveys among 4,739 luxury consumers with an average income of about   This sample is representative of the approximately 22 million affluent households in the country.

"The contraction in the percentage of affluents buying home luxuries -- from 52 percent in 2006 to 41 percent in 2009 -- is a cause for concern for marketers," says Pam Danziger, president of Unity Marketing and author of the report.  "However, significantly higher levels of spending from affluents who did make a home luxury purchase should have a moderating effect for marketers."

Trends in the market for home luxuries

Key findings on the market for home luxuries include:

• In art and antiques, the big story is original art.  Affluents want -- and are willing to pay for -- that one-of-a-kind piece.

• In home electronics, televisions were the big mover.  In electronics brands, both for home and personal electronics purchases, it is no surprise that Apple is luxury consumers' favorite brand.  Bose is another popular electronics brand, especially among the most affluent shoppers.

• For home decorating fabrics, window and wall coverings, interior decorators significantly increased their penetration in this market in 2009, ranking as the second most popular source for these goods.  The Internet too rose in importance for shoppers.

• Affluent home owners invested in lots of new lamps and lighting accents in 2009.  Home improvement stores gained share of affluents' retail sales in the furniture, light and rug category as a result.

• All things luxury for outdoor living got a boost in 2009.  From outdoor furniture, power equipment, lighting, water features and barbecue grills, luxury consumers invested more in their outdoor living spaces.

• Perhaps in response to less dining out, affluents moved their home cooking up a notch in 2009.  They invested more in cook's tools such as small kitchen appliances, cookware, cutlery and bakeware.  They also turned to specialty gourmet cooking stores as their #1 destination for their housewares purchases, knocking department stores into second place.  The Internet was the third more popular destination.

• Affluents also invested more in their kitchens by buying luxury kitchen appliances and other kitchen equipment such as cabinets, countertops and sinks. Specialty appliance dealers benefited strongly from these investments, ranking as the second most popular destination for luxury shoppers after the big-box home improvement stores.

• Affluents slept better in 2009, at least as measured by greater spending on mattresses and box springs and bed linens.

• Affluents who purchased luxury tabletop declined in 2009, but those who bought spent over 50 percent more.   Specialty gourmet stores and the internet picked up market share of affluents' spending on tabletop, while department stores and specialty home furnishings stores lost share.  For the first year in luxury tracking, Waterford beat out Lenox as the top tabletop brand.

"As we can see from some of the major take-aways from this most recent home luxuries study, those affluents who are still buying home luxuries are spending more, but their spending patterns have shifted to new items, new brands, and new channels of distribution," says Danziger.  "The home luxuries marketer is charged with navigating new terrain, and this kind of consumer intelligence research can serve as a much-needed road map."

About the Home Luxury Report 2010

Unity Marketing's Home Luxury Report 2010 is the ultimate guide to the U.S. market for luxury goods for the home. This report focuses on the buying and spending habits of the nation's affluent households -- the top quintile or 20 percent of U.S. consumer households -- of high-end or luxury products and services.

The Home Luxury Report examines consumers' buying behavior and spending habits related to these key categories of luxury purchases:

• Art & Antiques

• Electronics & Photography Equipment

• Home Decorating Fabrics, Window & Wall Coverings

• Furniture, Lamps, Rugs & Floor Coverings

• Garden, Outdoor, Lawn & Patio

• Kitchenware, Cookware, Cook's Tools

• Kitchen Appliances, Bath & Building Products

• Linens & Bedding Products

• Tabletop, Dinnerware, Flatware & Servingware

The report contains details on these nine luxury goods categories bought by affluent consumers, including annual spending, where these products were purchased and details of the types of products and services bought.  This years report contains trend data covering 2007 through 2009.

The HomeLuxury Report 2010 is written by Pam Danziger, an internationally-recognized expert on the luxury market and is based upon the kind of in-depth consumer research for which Pam Danziger and Unity Marketing are known.