luxury goods companies, including Apple: changes in the wind background Luxury goods customers fall into two camps: the truly wealthy, and aspirational buyers. The difference is this: For the truly wealthy, price isn’t a determinant of what they buy. The truly wealthy choose, say, a Bentley rather than a Hyundai because they like the way the motor sounds or because the seats are comfortable, or because it’s what they’ve always bought. The fact that the Bentley costs 5x+ what the most expensive Hyundai sells for makes no difference. Why? It’s because the amount of money involved is–for them–insignificant. It’s the same as the choice between buying a so-so $5 t-shirt vs. a cooler $15 one as a travel souvenir might be for most of us. Aspirational buyers, in contrast, are conscious of the price they’re paying. And it may well be more than they can really afford. But they buy the luxury brand anyway, as a way of announcing to the world that they have the wealth, or good taste or high social standing they aspire to. For luxury goods companies, the wealthy remain steady customers through thick and thin. Aspirational purchases ebb and flow with the economic cycle.
Posted on: Sat, 20 Jul 2013 20:29:57 +0000
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