Global luxury brands survey shows one third of people feel guilty if they treat themselves and half prefer logos on their luxury goods
HONG KONG — Global market intelligence firm Synovate today released data from a global study on luxury brands that showed two in three people across 11 markets treat themselves to luxury every now and then, but one third feel guilty about it.
Synovate’s CEO for the UK and luxury research expert, Jill Telford, said people have an odd relationship with luxury.
"Some of us feel we deserve it and revel in unabashed luxury. Some indulge in it but feel they maybe should not have. Some cannot afford it, but want it. And for many, it’s simply not even a consideration... the basics in life are tough enough to obtain.
"Of course a recession makes luxury retail even more challenging. Selling things that arguably people do not need during a time when many are at least morally forced to examine their spending patterns makes for interesting times.
“The luxury marketers that are doing well are doing so by knowing their markets and positioning their products just so.”
This Synovate survey takes a look at luxe dreams, extravagance, indulgence and the finer things in life. What do people feel when they buy luxury? How do they treat themselves? And what is their luxury brand shopping style? The company spoke with over 8,100 people across 11 very different markets.
A lingering look at luxury
But first, what is luxury? Do people define it as the feel of cashmere on your skin, the joy of time to spend as you wish, or the pleasure of showing your success in life? The survey shows it depends where you live.
The top three results across all 11 markets were:
1. Luxury is everything over and above what you need – 35%
2. Luxury is a lifestyle – 17%
3. Luxury is time to do exactly what you want – 16%
But it’s far more telling to look at the market-by-market results.
Nearly half of all Dutch respondents (49%) took the practical view that luxury is everything over and beyond what is needed. Researcher Karen Oerlemans of Synovate in the Netherlands said: "Being a small country in the periphery of Europe, the Dutch have developed a strong critical attitude against everything that is bigger, better, more powerful, or just ’more’ than the norm.
“The Dutch dislike people with tons of attitude. People who do flash their wealth with big designer logos are frowned upon. This attitude translates to the way the Dutch look at luxury goods. They buy luxury because it makes them feel good. It is not about the reputation of the brand or to flaunt it to others. Luxury is not a way of life.”
Contrast this to Brazil, where luxury retail is relatively new and growing fast. Twenty-four percent of our Brazilian respondents (the second-highest) agreed that luxury is a lifestyle.
Jesus Caldeiro, head of client relationships for Synovate in Brazil, explained: “The luxury market here is expected to grow over 12% in 2009. More and more luxury brands are entering the country and, more importantly, the richest consumers are buying. As an example, it is expected that sales in the recently opened Hermčs shop in Sao Paulo will soon top those in some more established markets.”
Twenty-six percent of the United Arab Emirates (UAE) respondents agree that luxury is a lifestyle and director for client relationships in Dubai, Per-henrik Karlsson, said that media and advertising are geared towards luxury brands there.
“This creates aspirational behaviour among expats, tourists and locals alike. It starts even before you arrive, as the Emirates Airlines pre-landing video about Dubai is all about shopping, luxury cars and hotels. And once on the ground, it’s everywhere: the main highway is full of billboards advertising luxury brands. Even eating out in Dubai is part of this lifestyle, with some luxury brands operating their own food and beverage outlets in malls.”
Another possible answer was ’Luxury appeals to my senses... it is beautiful fabric, delicious food and so on’ which was chosen by 18% of respondents in both the United Kingdom (UK) and France, the top responses for that definition... possibly for quite different reasons.
Director of development for Synovate in France, Alain Denis, agreed: “The French people are certainly hedonistic; they love to enjoy ’small pleasures’ like a good smell, or the softness of a scarf, and of course cooking and eating.”
Telford suggested the British response is probably more to do with food and taste than the other senses.
“The UK can be quite austere about some luxuries but eating is a pleasure that is allowed and encouraged – much more than ’things’. London is a gourmet centre with every kind of food specialty you can imagine.”
The top answer in India was ’Luxury is more about quality than it is about price’ with 28% choosing that definition.
You could argue that the overarching purpose of luxury is to make you feel good. But not for 32% of our respondents.
Two in three people treat themselves with luxury every now and then, but nearly a third of people across 11 markets then feel guilty about it. So, who are the most conflicted consumers of luxury?
Telford said: "It’s the Brits of course. While 72% say they treat themselves with luxury ? and make no mistake, luxury is seen as a treat in Britain - the Brits were still the most likely to agree that they often feel guilty if they buy something luxurious for themselves (50% said they did).
“It’s a classic case of British guilt. It’s seen as much more acceptable to buy something ’needed’ for the home than it is to indulge yourself in any way.”
What’s more, it is British women who top the guilt scale, with 66% feeling bad after a luxury purchase versus 37% of British men. A similar pattern can be seen in the second-most guilty nation, the US... 58% of American women beat themselves up after a lavish buy versus 35% of their male counterparts.
Telford added: “It’s a real hangover from days-gone-by, but many women have difficulty putting themselves first. As a consequence they are more likely to quash the urge to spend by buying something for someone else, or if they do engage in ’stealth’ luxury buying for themselves, they don’t enjoy it as much as they should.”
Mark Berry, head of the consumer and retail industry sectors for Synovate in the US, said: “The luxury goods market in the US has been hit hard by the economy. Many retailers have now designed product and pricing strategies that appeal to a more austere, guilt-ridden consumer in search of the combination of premium products and value.”
At the other end of the scale, 74% of Indians and 71% in both Brazil and the Netherlands say they do not feel guilty after a luxury purchase.
Mick Gordon, managing director of Synovate in India, said a luxury purchase is a well-thought out purchase there.
“Indians will only splurge if there is money in the bank and they have considered all their options. There is less dependence on plastic money than in other nations and therefore no reason to feel bad afterwards.”
Similarly, Oerlemans said: “In general, the Dutch are sensible about spending their money: they are not living above their means. So if you can afford it, why feel guilty about it?”
Caldeiro added Brazilian hedonism prevents the possibility of guilt. “Brazilians take great pleasure in life, enjoying it and whatever they can afford whether it’s a big ticket item or not. The reward and pleasure of consuming a luxury (however big or small) far outweighs any negative feelings.”
For many, luxury just is. You should not show a logo. For others, it’s all about the logo. Overall, 47% across all 11 markets say they prefer to buy logoed items, 34% would choose non-logoed items and 18% don’t know.
Showing a classic divide in luxury attitudes, the markets that most prefer logoed items are all places where it is acceptable to flash purchases (and that’s sometimes the point!), topped by India (79%), Hong Kong (68%) and the UAE (58%).
The markets that are more likely to appreciate a subtle luxury purchase, preferring non-logoed items, are Brazil (51%), France (47%) and the UK (46%).
Gordon said of the India result: “Indians with deep pockets and those who have attained a certain social status splurge on luxury items to make a statement - flaunting labels enhances the perceived ’value’ of the individual among his peers and the society at large.”
The UAE is also all about the statement that an obvious brand makes. Karlsson said: “Showing off logos is not seen as bad taste; whether it’s old or new money doesn’t matter nearly as much as simply having money! In fact, another newly popular trend here is buying brands that sport oversize logos, like certain shirts - the more ostentatious, the better.”
Telford said: “The UK result doesn’t surprise me ? they don’t encourage showing off here. Of course, in Hong Kong, flashing your purchases and spending power is more than acceptable.”
“In France, there is no need to show others that you can buy brands. What is important is that you appear smart and elegant. Of course fashion is important, but no bling please,” Denis added.
Is it for pleasure or treasure?
So what do people most enjoy about buying and owning luxury? Do they see dollar signs and brands, or simply feel fabulous, or both? The Synovate survey showed that the top three overall pleasures in buying and owning luxury are:
1. It makes me feel special to own it – 28% across the 11 markets, led by the US at 45% and the UK at 44%
2. The way it is made or feels – 27%, led by the UK at 35% and the US and France, both 32%
3. The reputation of the brand – 14%, led by 28% in India and 20% in each of France and Hong Kong
Telford said: “UK people have fewer luxury items than say, Asians, as it’s not such a common thing here to buy luxury products, so they probably treasure them more.”
Hong Kong’s qualitative director, Salina Cheng, concurred: “Being able to buy and own something from a luxury brand is a symbol of status and wealth to Hong Kong consumers. Reputable brands such as Louis Vuitton and Chanel are most sought after and appreciated by the general public. They are preferred as they are considered a ’safe choice’ to impress other people.”
Other interesting findings:
* 20% of Indian respondents say they most enjoy the shopping experience (versus an average of 10%).
* 14% of people in the UAE most value the feeling ’that I have something my friends and colleagues do not have’.
Shopping and spending style
Once you have decided to buy luxury, do you buy on the spot, or research extensively, or land somewhere in the middle? Synovate asked people across 11 markets and the top shopping style, chosen by 28% of all respondents, was, “I research every other alternative and then buy the item of best value to me”.
Taiwanese and Brazilian respondents (both 37%) were most likely to research before buying.
Other prevalent shopping styles were:
* An overall 19% who “walk away and think about it; if I still want it I buy it”, led by Hong Kong at 29% and the UK at 24%
* 18% said “I ’visit’ my object of desire in the shop a few times before I purchase”, led by 39% in India and 22% in France
* 17% are very decisive saying “As soon as I decide I want it, I buy it”, led by 28% in India and 23% in the UAE
Gordon said: “Once the decision is made, there is rarely any dilly-dallying.” This is something that Karlsson echoed for Dubai: “Impulse buying is quite normal in Dubai, again linked to one-upmanship. If something new is released onto the market, people buy it immediately so they can have something no one else has.”
Cheng said Hong Kong people have not stopped spending on luxury but they are a little more circumspect in the process. “People are less impulsive because of the global financial crisis but that has not stopped them from buying luxury. If they see something they want, they still buy it, but they are more likely to have a grace period to make sure a wise decision is being made. The implication for retailers is that there is still a chance to convert purchases, even if it is later in the buying process.”
The top answers for “I find and look at it online and then either buy online or in the store” come from the Netherlands at 21% and France at 17%.
Luxury with all the money in the world...
Pretending for a moment that money was no object, Synovate asked people what one luxury brand item would give them the most pleasure to purchase.
Obviously a ’big ticket’ boosts the chance of someone choosing an item. With that in mind, the top four choices were:
* Pretending for a moment that money was no object, Synovate asked people what one luxury brand item would give them the most pleasure to purchase.
* Car - 31%, chosen by 57% in Brazil, 51% in the US and 50% in Canada
* Fine jewellery - 11%, led by 28% in the UAE and 24% in India
* Designer clothing ? 11%, topped by 25% in India
* A great gadget - 11%, led by 20% in Hong Kong and Spain
Rob Myers, Synovate’s head of Motoresearch in North America, said: “People may talk up the troubles of the automotive market but it remains the number one status in luxury items in most markets.”
Hong Kong’s Cheng added: “A great gadget is probably something people can show off to friends during gatherings; it creates conversation and makes a statement in Hong Kong.”
Other interesting answers were:
* Luxury watches were topped by 15% in the UAE and 13% in Hong Kong
* 13% of Taiwanese chose designer leather goods like shoes or bags
* 22% of Dutch respondents said ’Nothing, I would not purchase any of these items’, despite this being a ’money no object’ question
Telford, who is UK-based but lived for many years in Asia, added: “There is a big tradition of luxury watches in Hong Kong, so this is not surprising. It’s something you can show off - even the ticket collector on the local Lamma ferry has managed to buy a gold Rolex so if money were no object this would be an even more popular choice.”
...and luxury within your means
The survey also asked about ’little’ luxuries that people are most likely to purchase, finding that food and beverage luxuries topped the list.
The top three overall choices were:
1. Food or beverage item - 19%, topped by 33% in the UK, 31% in the US and 30% in Brazil
2. Sporting equipment or clothing - 18%, led by 32% in Taiwan and 25% in Hong Kong
3. None of these - 14%, led by 28% of the Dutch respondents
Managing director for Synovate in Taiwan, Jenny Chang, put the sporting equipment choice down to the LOHAS (Lifestyles of Health and Sustainability) trend. “In Taiwan, it’s now quite fashionable to be healthy and ’outdoorsy’. A great many people are into bike riding on the weekends and many splurge out on bicycles and accessories.”
Other interesting snippets:
* Perfume or after-shave was the top ’little luxury’ in France (21%), Spain (20%, as well as 20% for sporting equipment) and India (19%).
* Leather accessories was the top answer for the UAE (16%), plus 19% of Hong Kong people chose this category.
* The top answer for lingerie or underwear came from 13% of French respondents.
* The top answer for cosmetics came from 14% of Indian respondents.
Denis said: “Little luxuries help the French to feel good and smart. It is typically French to indulge in perfumes, leather or underwear. After all, these accessories fine-tune your appearance. It is not important that they be expensive, simply that they are elegant.”
* Practical luxury... four in ten would buy secondhand luxury, topped by 59% in the US and 51% in the UK.
* Seventy-three percent of Indians and 70% of Taiwanese love to give the gift of luxury, partly due to the obvious value.
* An overall 37% look at or read about luxury brands on the brand’s own website, led by 54% in the UK and 53% in the US. Shop windows still rule though (66%).
* Seventy-nine percent of Indians look at or read about luxury brands via pictures of celebrities in magazines or on TV. Least likely to do this were 70% of Dutch, 65% of French and 64% of UK consumers.
About the Synovate In:fact global study on luxury brands
This In:fact survey on luxury brands was conducted in October 2009 across 11 markets – Brazil, Canada, France, Hong Kong, India, Netherlands, Spain, Taiwan, the United Arab Emirates (UAE), the United Kingdom (UK) and the United States of America (US). It covered over 8,100 urban respondents.
Synovate, the market research arm of Aegis Group plc, generates consumer insights that drive competitive marketing solutions. The network provides clients with cohesive global support and a comprehensive suite of research solutions. Synovate employs over 6,400 staff across 62 countries.
For more information on Synovate visit www.synovate.com.
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