This month’s Trendwatching.com newsletter suggests that status is still the center of the consumer universe, but that status is no longer measured by simply “spending” or “owning.” Now, it is manifest in things like giving, doing well (to others), social responsibility, and more. Click here to read the issue.
Implications: This edition of Trendwatching is not all about luxury goods... but that's a category I'm thinking about right now. Purveyors of upscale or luxury goods had a particularly challenging time during the Great Recession, and they are likely most eager to see the economic recovery gain momentum. But even with apparent stability returning to many household economies, it might be a good idea to study how and why consumers spend on premium products.
For example, have you noticed any instances of “inconspicuous consumption?” That’s when people buy a Gucci or Coach handbag, and then ask the clerk to wrap it in a logo-less shopping bag. They want the nicer item… but they don’t want to be seen as spending too much when many other folks are cutting back. Another example might be the consumer who buys the flat-screen TV, but waits until the garage door closes before taking it out of the car and into their home. (In a previous life, perhaps that same consumer would have been happy to show-off the purchase to the rest of the neighborhood.) Earlier this week, one of my clients referred to this behavior as “Stealth Wealth.”
My personal hunch is that luxury goods will regain popularity as more and more people begin to prosper during the economic recovery. But there are many people who are ready to go upscale now… perhaps motivated by a different set of criteria than they were pre-recession. Which reasons motivate you?
Mike Anderson
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