It's early October, and affluent shoppers are already quietly shopping for the holidays. As affluents can be defined in many different ways, in today's column we will focus on the
following three affluent market segments and their holiday shopping plans:
- $75,000+ in household income, the top 36% of American households;
- $250,000+ in household income, the top 3%; and
- $500,000+ in household income, the top 0.5%.
As part of our most recent wave of
our ongoing survey (completed in late August), we surveyed affluent adults about many topics. One of these was their spending plans for the 2015 holidays. And not surprisingly, the three affluent
market segments differ as their household income rises. Here's a short summary of what we discovered.
- About one in four (22% of the $75,000+ and 29% of the $250,000+
segments) had already started their holiday shopping, while more than a third (36%) of the smaller $500,000+ segment was already out there doing the same.
probed about their 2015 holiday spending plans, almost one half (43%) of the $500,000+ segment indicated they are planning to spend more for the holidays this year compared with last year, while 19%
of the $75,000+ and 24% of the $250,000+ segments also reported they were going to spend more this year. This compares with 12% of the $75,000+ and only 6% of the $250,000+ segments who plan to spend
less than last year. These holiday buying plans suggest to us that, when the dust settles and the holiday retailing reports get published in early 2016, holiday spending among the affluent will most
likely be materially higher than last year.
- When asked how much they were planning to spend this holiday season, the very important consumers with household incomes
of $75,000+ indicated they are planning to spend almost $1,400 each on average, almost $2,400 each when they are in the $250,000+ segment, and $4,400 each when they are fortunate enough to live in the
$500,000+ segment. These average holiday spending amounts are materially higher than the $900 spending level for the average American adult.
- Among the major types of
shopping venues measured in this holiday shopping survey, the number one venue selected among the $75,000+ and $250,000+ segments was the online-only store category (i.e., Amazon, eBay, etc.), with
about six out of ten (62% of the $75,000+ segment and 60% of the $250,000+) planning to shop at one more of them. Notably, the number one venues among the $500,000+ affluents were luxury department
stores and luxury goods stores, with almost half (48%) planning to use one or more of them to do their holiday shopping.
- When asked what types of gifts from a list
of 21 major categories they were planning to buy, both the $75,000+ and $250,000+ segments mentioned gift cards as the number one choice (45% of the $75,000+ and 44% of the $250,000+ segments), while
the $500,000+ segment's number one choice was designer goods gifts.
- Finally, when asked to estimate how much of their total holiday spending amount would be spent
online, the affluent consumers estimated almost half (45% for the $75,000+ segment and 47% for both the $250,000+ and $500,000+ segments).
So, to echo the old song that
says, "Spring will be a little late this year," this year's holiday shopping season is starting very early… which bodes a most merry bonanza for luxury marketers.