Accenture Study Finds Half of U.S. Consumers Intend to Purchase Luxury Products in Next Six Months; Small Luxuries Entice

  Accenture Study Finds Half of U.S. Consumers Intend to Purchase Luxury
  Products in Next Six Months; Small Luxuries Entice Shoppers to Splurge

  Preference for shopping in physical stores to see and touch products tops
                              online purchasing

Business Wire

NEW YORK -- November 13, 2012

Half of U.S. consumers are likely to make a small luxury purchase in the next
six months, including 53 percent who are likely to purchase specialty food or
drinks, 48 percent to purchase luxury clothing and 48 percent to purchase
luxury personal care products, according to new research from Accenture (NYSE:
ACN).

The Accenture Luxury Shopping Survey polled more than 2,000 U.S. adult
consumers and found that splurging on a small luxury is the number one reason
consumers buy specialty food or drinks, selected by 53 percent of those who
expect to make these purchases in the coming months. Similarly, high-low
fashion is the top reason shoppers shop luxury apparel. More than half (57
percent) of those who intend to purchase luxury apparel will mix a few luxury
items into a wardrobe of more affordable clothing.

“As consumers show an increasing willingness to splurge on luxury, retailers
and brands can build loyalty by offering a strategic selection of
smaller-ticket luxury items to complement their more significant products,”
said Tom Jacobson, managing director of the Accenture Pricing & Profit
Optimization practice. “Consumers want a taste of luxury in their everyday
lives, and are willing to spend a little extra for the experience, but the
emphasis is on small items. They may think twice about purchasing a new
handbag, but shop for a wallet as an alternative.”

Online Luxury Shopping Down, But Not Out

In each of the three small-product categories polled, consumers indicated a
strong preference for brick-and-mortar stores when shopping for luxury goods:

  *On average, 36 percent prefer to shop in a physical store, while 19
    percent prefer to shop online.
  *Among those likely to purchase luxury food and drink, half (50 percent)
    prefer shopping at specialty grocery stores and 40 percent like shopping
    at mass retailers, while only 19 percent prefer to shop at online-only
    retailers.
  *The top reason for shopping in physical stores is to see all the choices
    in person (38 percent). Nearly a third (30 percent) of shoppers in this
    category prefer online retailers to get the best price and one-quarter (25
    percent) value the convenience of online shopping.
  *For those who are likely to make a luxury apparel purchase, more than half
    (58 percent) picked department stores as their top choice, compared to
    only 29 percent who prefer a department store’s website and 36 percent who
    prefer online-only retailers.
  *The top reason given for choosing the physical store is the ability to
    touch and feel the products, selected by 49 percent, whereas online
    retailers are preferred for finding the best deal (37 percent).
  *Physical stores beat online shopping two-to-one for luxury personal care
    products (including hair care, skin care and makeup): 44 percent of
    shoppers in this category prefer drug stores and 40 percent prefer
    department stores, compared with 22 percent who prefer online-only
    retailers.

The study also found that showrooming, or viewing a product in a store and
then going online to make the purchase, plays an important role in luxury
purchases. In the past six months, one in five consumers visited a store to
experience a luxury product in person and then purchased the product online.

Additionally, the study found that having access to special deals and bargains
through group membership shopping sites has invited more luxury purchases.
Among the 23 percent of consumers who have bought luxury goods and services
from an online group that offers exclusive discounts to members, 58 percent
say these sites have increased their luxury spending.

“The new consumer is online savvy and always on the hunt for a discount, which
is pushing brands to get very smart about leveraging the growing number of
channels consumers use to make luxury purchases,” said Jacobson. “Traditional
retailers, online stores and even designers need to have a very compelling
answer to the question: what is the advantage of buying from me? Without that
answer, online price comparison engines, barcode scanners and shopping apps
will win consumers over,” said Jacobson.

Younger Generation Most Optimistic About Buying Luxury

The Accenture survey identified a number of differences between Millennials
and Baby Boomers when it comes to luxury shopping. More than a third (35
percent) of Millennials indicated their likelihood to purchase luxury goods is
up over the past year, while nearly half (46 percent) of Baby Boomers
indicated their likelihood to purchase luxury goods has decreased in the past
year.

Among those consumers who said they are not likely to purchase luxury goods,
the majority of Millennials indicated they cannot afford the prices, while the
majority of Baby Boomers indicated that luxury is not important to them or not
worth the cost.

Quality Trumps Brand Name

The survey found quality is ranked the most important factor by 75 percent of
consumers when buying luxury, followed by price at 69 percent. Only a quarter
(25 percent) ranked brand name as most important. Looking at specific product
categories, more than a third (34 percent) of consumers surveyed cite quality
as the reason for purchasing specialty food and 26 percent cite quality as the
reason for purchasing luxury personal care products and the same number cite
quality as the reason for purchasing luxury apparel.

“Luxury brands cannot rest of on strength of their names alone,” said
Jacobson. “As consumers begin spending again, luxury brands must ensure that
the quality and features of their products exceed the expectations set by
their price tags, or they risk losing consumers to another luxury brand, or
even to a non-luxury one.”

For more details, download the Accenture Luxury Shopping Survey infographic or
the Accenture Luxury Shopping Survey findings.

About the Research

Accenture surveyed 2002 U.S. adult consumers via online survey to understand
their luxury purchasing intentions and preferences. The overall sample was
targeted to reflect census distribution of the adult US population. The
overall margin of error is +/- 2.2 percent.

About Accenture

Accenture is a global management consulting, technology services and
outsourcing company, with 257,000 people serving clients in more than 120
countries. Combining unparalleled experience, comprehensive capabilities
across all industries and business functions, and extensive research on the
world’s most successful companies, Accenture collaborates with clients to help
them become high-performance businesses and governments. The company generated
net revenues of US$27.9 billion for the fiscal year ended Aug. 31, 2012. Its
home page is www.accenture.com.

Contact:

Burson-Marsteller
Kaitlyn Rawlett, 212-614-4164
kaitlyn.rawlett@bm.com
or
Accenture
Rachel Frey, 917-452-3771
rachel.frey@accenture.com
 
Press spacebar to pause and continue. Press esc to stop.