6 Affluent Life Styles, From Ivanka To Bono

by Richard Baker, Jun 18, 2009, 5:00 AM

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Many luxury merchants employ segmentation schemes to attempt to understand market potential along two dimensions. Age, income, family status, etc. refer to the customer. Performance, style, size, function, etc. refer to the product.

Both are designed to answer questions like: "How many young married couples will take a cruise in the Bahamas?" Or: "Of the couples who will cruise the Bahamas, how many will buy trinkets in our gift shop?" In these cases the purchase of the luxury object (the cruise or the trinket) is viewed as an in dependent decision.

However, Life Style marketing views these as dependent decisions, which must fit an overall pattern the consumer has already established -- their Life Style. This difference is very significant because by starting with Life Style, luxury marketers begin with a context in which to understand "individual" decisions about key purchases.

Let's take a quick tour of the Six Basic Life Styles.

Unmistakable and Impactful Affluent Life Style (21% of the market)
Donald and Ivanka Trump

In most product categories, the Unmistakable Affluent places the greatest importance on the largest number of brand attributes compared to other Life Styles. Appearance is very important, and they are the least likely to expect desirable goods and services to be offered at discount prices and are more influenced by advertising than other Life Styles. Success with this segment relies on making them feel they are recognized for being very important and treated in an exclusive manner.

Tasteful but Unique Affluent Life Style (15%)
Ralph Lauren and Martha Stewart

This Affluent Life Style seeks things that reflect their sense of individuality, which is often demonstrated through knowledge of design, workmanship and high-quality materials. Connoisseurship is very important to Tasteful and Unique Affluents. So manufacturers must offer products and services that will capture the eye of this segment.

Practical and Popular (12%)

The Practical Affluents -- like the Understated Affluents -- have a higher-than-average probability of being business owners, but are much more demonstrative about their feelings and are proud of what they have acquired. Brand names are very important. Often they have acquired the possession, trip, etc. as a self-reward for some accomplishment. The brand and position of things is a very important part of the value of the acquisition.

Economical and Safe Affluent Life Style (21%)
Allen Greenspan and Suze Orman

The Economical Affluents are much like the Unmistakables, except they are often on self-imposed budgets. They are not social or economic risk-takers -- rather, they see which brands are well-accepted and buy them ... on sale. Many merchants know that to maintain the prestige of their brands, they must develop new channels to market "distressed" merchandise or markdowns to the Economicals.

Understated and Functional Affluent Life Style (13%)
Warren Buffet and Melinda Gates

The Understated are interested in quality products and services, but prefer not to be "showy" about their possessions or to be treated obsequiously. They expect a type of small "r" republican respect rather than "over the top" service. Key to success with this segment is an efficient delivery process that does not attract a lot of attention. Staffers must be able to recognize the Understated Affluent as affluent, not just as casual. Horror stories abound around Understated Affluents being ignored in showrooms because they don't look the role.

Dependable and Value-Conscious Affluent Life Style (18%)
Oprah Winfrey and Bono

The Dependable Affluents are hard to market to because they try not to act affluent -- at least not for their own personal satisfaction. They tend not to spend as much on clothes and personal care as other segments, but are more likely to purchase a vehicle for its functionality rather than its "badge appeal."

To develop relationships with the Dependables, marketers should become involved in their causes and support efforts they sponsor or support. Promotions should not be "self promotional."

Hopefully, these sketches of the key Life Styles make the point. Individual purchases must be consistent with life-as-lived by the prospect. Warren Buffet will not be driving a Rolls Royce (unless he buys the company), nor will Donald Trump be driving a Prius unless it is in a commercial for which he is well compensated.

Life Style is not a matter of age or income, but rather a matter of personal taste painted across the arc of one's entire existence.

This is an excerpt from the forthcoming book, The Future of Luxury: The Peacock and the Prius."

Editor's note: If you'd like to contribute to this newsletter, see our editorial guidelines first and then contact Nina Lentini.

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