Wealthy to spend more on jewelry this year
August 07, 2013
New York--Affluent Americans are expected to increase the amount they spend on fine jewelry and watches over the next eight months, and jewelers catering to this high-end clientele could reap the benefits with the right store atmosphere and sales techniques.
The latest Survey of Affluence and Wealth in America, conducted earlier this year by the Harrison Group and American Express Publishing, found that affluents--described as the top 10 percent of the wealthiest Americans--are projected to increase spending on fine jewelry by $1,169 per household for the rest of the year, a 10 percent increase when compared with current spending habits.
Spending on watches is projected to increase 8 percent, a spending increase of $644 per household.
Cara David, senior vice president of corporate marketing and integrated media at American Express Publishing, said affluents have been extremely resourceful since the beginning of the recession, spending these past years getting their household financial situations in order, from eliminating credit card debt to paying off mortgages.
Now, these consumers are in a place where luxury spending can come back into play.
“Spending and the enthusiasm for spending is starting to pick up in categories that, up until this point, have been suppressed because the affluent have been very good at exhibiting restraint. Now, they feel good about what they’ve done and want to reward themselves for their hard work,” David said.
When it comes to the economy, the survey found that 67 percent of affluents believe the recession is still on and 47 percent said the recession will last at least another year.
That is an improvement when compared with last year when 81 percent said the recession was still on and 58 percent expected it to last another year.
In addition, 66 percent of respondents believe the U.S. job market is improving, up from 52 percent in 2012.
Jim Taylor, vice chairman of the Harrison Group, said affluents have loyalties to brands, but the brands they are loyal to depend on the type of consumer they are: “deal” or “worth” customers.
Deal customers, he explained, are looking for the best prices, while worth customers want quality, good service and craftsmanship, and shop with brands they feel have their best interest at heart.
“The margin split between the people who shop based on deals and those who shop based on worth is that worth customers will outspend deal customers by about $25 billion,” Taylor said.
When it comes to jewelry, these affluent worth consumers enjoy stores that are well organized, beautiful and staffed by people who know exactly what the merchandise is, who the designer is and can explain the pricing, he said.
“They want a salesperson who is so in love with their job that they create a relational atmosphere where the salesperson enjoys the purchasing process as much as the customer,” Taylor said.
Worth customers tend to forget the price of a product that they have purchased and liked, while deal customers value how much they saved more than the object.
“We’re suggesting a quality jewelry store may want to pay attention to their worth customers,” Taylor said. “It’s a matter of store owners coming to understand what people want--they want jewelry, but they want an experience as well.”
The 2013 Survey of Affluence & Wealth in America was conducted via 2,210 online interviews between January and March 2013, among consumers with a discretionary income of at least $100,000.