Survey Shows One in Three Consumers Made a Luxury Purchase Within the Last Six Months

The Empathica Consumer Insights Panel also found a large variation among income groups in how much consumers would need to earn to consider themselves wealthy.

Toronto, Ontario, Canada – January 12, 2012 – Empathica Inc., a leading provider of Customer Experience Management (CEM) solutions to some of the world’s most respected brands, announced today that its Consumer Insights Panel survey found that one in three consumers purchased a luxury product or service within the last six months.

The dominant reason consumers made a luxury purchase was to reward themselves, followed by the fact that they had delayed making the purchase for some time. Others bought something for a significant other, or simply stated they had extra money to spend. Regardless of the reason behind the purchase, these generally aren’t quick decisions with three in four consumers saying they spend considerable time thinking through a luxury purchase before committing to it.

“The notion of luxury is very subjective, but we typically have certain brands we automatically deem as ‘luxury’ products,” said Emmanuel Probst, VP of Retail at Empathica. “Interestingly, even in the luxury space, getting a good deal is still a major part of the overall customer experience. Though consumers appear willing to spend on luxury retail, we’re seeing more continue to move from conspicuous consumption to conspicuous value.”  In fact, while most consumers were hesitant to boast about a luxury purchase they made, a third did say they bragged about getting a good deal.

In the survey, the majority of men said their most expensive purchase over the past six months was between $1,000 and $2,500. For women, the majority indicated their most expensive purchase had been between $100 and $500. One in 10 consumers said they had purchased something between $25,000 and $50,000. Clearly, what defines luxury depends on the individual shopper who is making the purchase, added Probst.

The definition of what constitutes being “wealthy” also varies widely between income groups.  Almost half (45%) of consumers with household income between $50,000 and $60,000 indicated that they would consider themselves wealthy if they earned $100,000 per year, while only 16% of those actually making $100,000 per year said the same. For those earning more than $100,000, perceptions of being wealthy stretches out even further. A third indicated that they would need household income in excess of $250,000 per year to consider themselves wealthy.

Canadians Prefer In-Store Shopping; Americans Are More Divided

Despite the growing trend toward online shopping, 61% of consumers still prefer to shop in-store for luxury products — with the majority indicating they like to personally examine a product before they buy it.  For those who prefer online shopping, one in three indicated it was because they wanted to avoid crowds; one in four said they liked the convenience of shopping from home.

Canadian and American sentiments differed widely in regards to shopping preferences, however, with 80% of Canadians opting to shop in-store versus only 52% of Americans.

In terms of technology to enhance the shopping experience, 32% of consumers indicated tablet PCs were a valuable tool.  Results were divided, however, with 39% indicating they were not valuable and 29% expressed they were unsure.  While the value of this technology is clear for some consumers, interestingly, a full 82% of consumers across North America indicated they don’t actually use a tablet PC. In describing their pre-purchase interaction with the retailer or brand, the vast majority of consumers indicated that they utilized the company’s website (87%) with only 13% saying that they used their mobile phone.

“Luxury retailers need to understand how their consumers prefer to shop, and then determine how they can make that experience more rewarding,” added Probst. According to survey results, three in four consumers said there are the same or more luxury brands available today than there were two to three years ago, making the marketplace more competitive than ever.

For more information on the results of this study, visit

About the Empathica Consumer Insights Panel:
The Empathica Consumer Insights serves as an authoritative voice on consumer based economic indicators; the retail, financial services and restaurant industries; consumer shopping intentions and customer satisfaction as reported by thousands of consumers in the U.S. and Canada. Results from Empathica’s Consumer Insights, led by Dr. Gary Edwards and Empathica’s Consumer Insights’ team, are published several times a year. The results are based on outbound Internet surveys with Empathica’s growing Insights Panel, derived from more than 30 million consumer surveys per year. Results have been weighted to reflect latest Census distributions in the U.S. and in Canada, including Region, Gender, Age and Income.

Aforementioned data is reported by the Empathica Consumer Insights Panel – Wave 2 2011, Issue 1.

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