New Unity Marketing survey reveals where the wealthiest Americans shop

Barneys New York, Nordstrom and Bergdorft Goodman Are the Top Luxury Department Stores among Ultra-Affluents   

But signs are that the wealthiest consumers are slowing their pace of shopping in these stores

The ultra-affluents, those with incomes of $250,000 and above, are the wealthiest 2 percent of U.S. households who spend the most in the consumer economy.  For the retailers who can capture this market, life is good.  However, as new data from Unity Marketing shows, holding onto the ultra-affluent market is a job even the top retailers struggle with.

Based on the latest quarterly survey of luxury consumers, Barneys New York, Nordstrom, and Bergdorf Goodman emerged as the top three luxe department store destinations among ultra-affluents.  However, a look back at the previous year shows ups and downs among ultra-affluent patronage of these retailers:

• Barneys New York, which currently attracts some 22 percent of ultra-affluent consumers, has weathered two quarters in the past year when patronage dipped as low as 16 percent.  
• While Nordstromranks as the second most popular destination, its share of purchase among ultra-affluents dropped by more than 5 percentage points from the fourth quarter 2010 to first quarter 2011.  

In fact, among the seven leading luxury department stores included in Unity Marketing's luxury tracking survey, only one -- Saks Fifth Avenue -- captured a larger share of ultra-affluent shoppers this quarter as compared with last.

Luxe department store patronage among ultra-affluents is down after peaking in third quarter 2010 

Even more striking is the decline in the percentage of ultra-affluents shopping in these luxe department stores overall.  While the percentage ofultra-affluents shopping in luxury department stores peaked at nearly three out of four in the third quarter 2010, it has declined precipitously since, leveling off at about 70 percent. Danziger explains that relatively small declines in patronage on a percentage basis translate into big drops across the market.  Regardless of ultra-affluents' favorite luxe department stores, it is clear that nearly a third of these wealthiest Americans are not passing through any of their doors each quarter. 

"These top retailers 'who are known for being destinations for the wealthiest customers' can serve as both a model and a cautionary tale for others who would like to operate in this space," says Pam Danziger, president of Unity Marketing and author of Putting the Luxe Back in Luxury.  "While the popularity of each store waxes and wanes quarter-to-quarter, the overall trend is that ultra-affluents are slowing their pace of shopping in the luxury department store sector.  If the downward trend among ultra-affluents continues, each of these stores may have to rethink their approach if they are to remain a compelling and attractive destination for the wealthy."

[Note:  The full list of luxe department stores and ultra-affluent shopping behavior is available on request by calling 717.336.1600]

>>More information on the shopping habits of the affluent available in Unity Marketing's Luxury Report 2011

The Luxury Report 2011: Ultimate Guide to the Luxury Consumer Market is a comprehensive guide to the shopping and spending habits of the affluent, including the  lower-income HENRYs (High Earners Not Rich Yet with incomes $100,000-$249,999) and the ultra-affluents from 2008 to 2010. Danziger explains, "So far the ultra-affluents are contributing more than their fair share to luxury businesses, but signs are that even the ultra-affluents are starting to pull back now that their pent up demand for luxury built up through the recession is starting to be satisfied." 

The Luxury Report 2011 gives marketers data about trends in what luxury consumers are buying, where they are shopping, how much they are spending and what brands they favor in key categories of luxury.  In total the report shares findings of 5,195 luxury consumers surveyed in 2010 (average income $311,400). 

"We designed the Luxury Report 2011 as both a powerful desk reference and a source for insight into the future trends in the luxury market.  The new report provides the kind of detailed facts and figures about the luxury consumer marketthat will delight data-driven executives.  But it also focuses on the mindset and attitudes of the luxury consumer, making it an invaluable tool for luxury brand executives to plan for the future of their changing marketplace," Danziger concludes.   

>> Luxury Marketers:  This is a report about your customers & your target customers

The Luxury Report 2011 is a compilation of the quarterly luxury tracking surveys that Unity Marketing conducts every three months with 1,000-1,250 affluent consumerswho purchased one or more luxuries in the study period.  Unity's luxury tracking study is the only longitudinal study of its kind that tracks the luxury consumer market, what they buy, how much they spend. 

In addition to providing detail data about affluent consumers' purchases and spending in 22 categories of luxury goods and services, this year's report includes metrics that measure spending by specific product and share of product category spending by retail distribution channel in these key product areas:

Home Luxuries

• Art and Antiques
• Home Electronics
• Furniture, Lamps and Floor Coverings 
• Garden and Outdoor 
• Home Decorating Fabrics, Wall and Window Coverings
• Kitchen Appliances, Bathroom Equipment and Building Products
• Kitchenware, Cookware, Housewares 
• Linens and Beddings 
• Tabletop, Dinnerware, Stemware, Flatware

Personal Luxuries

• Clothing and Apparel 
• Cosmetics, Fragrance and Beauty Products 
• Fashion Accessories 
• Jewelry 
• Watches 
• Wine, Liquor and Spirits 
• Personal Electronics
• Automobiles 

Experiential Luxuries

• Dining
• Entertainment
• Home Services
• Spa, Massage, Beauty and Cosmetic Services 
• Travel

The report shows which of the product categories are growing the fastest year-over-year based upon increase in sales and which product categories are dropping at the fastest rates.

>> This report doesn't stop with the data -- It pushes further to help marketers and retailers put the information to use

Unity Marketing's aim in publishing The Luxury Report 2011 is to translate the data into information that marketing executives can use to make critical strategic decisions.  This market research report helps make the research data and findings accessible and useable. It provides marketers with three powerful perspectives:  "What," "So What," and "Now What." The report is written to reveal the key research findings, explain why they are important to luxury marketers, and then help marketers find ways to put the research to use in developing new concepts, new strategies, new tactics for success.

 For media:  Danziger available for interviews.  Charts, tables and graphs detailing major findings in the report also are available.

About  Pam Danziger and Unity Marketing