Luxury Market's New Normal AFTER the Recession

STEVENS, PA, Jun 30 (MARKET WIRE) --
Everybody is asking it: What is the 'new normal' in the luxury market
after the recession? The answer is simple: The new normal won't be
anything like the old normal, according to the findings of a new research
study conducted by Unity Marketing and presented by Pam Danziger at the
recent Luxury Interactive conference held in New York City.

Danziger says, "Thanks to the recession, affluent consumers are taking
time out from their profligate, overspending ways to reassess, reevaluate
and reprioritize their lives. This will be bad news for luxury marketers,
some of whom maintain the illusion that the current recession is only a
temporary downturn in an otherwise rising luxury market. Unity Marketing's
research shows that affluent shoppers are starting to ask questions about
the luxury brands they once patronized, and those brands often come up
short with compelling and meaningful answers as to why they should buy."

"The new normal in the luxury market is going to be all about delivering
new values to the luxury shoppers who control the purse strings -- and the
fortunes -- of every luxury brand today," Danziger explains.

Results of New Research Presented at Luxury Interactive Conference

Unity Marketing recently conducted a series of focus groups among
highly-affluent and highly-engaged luxury shoppers in Beverly Hills. This
location was chosen because it is "ground zero" for the conspicuous
consumption lifestyle. The qualitative research was followed by a
quantitative survey in April 2009 among 1,041 affluent consumers (average
income $204,900).

The results of the research presented at the recent Luxury Interactive
conference give luxury marketers a view of their future after the
recession. It paints a picture of "The Good-The Bad-The Ugly" for the
luxury industry.

Danziger warns, "Unfortunately, the future will be very ugly indeed for
luxury brands that fail to listen closely to the opinions of what once
were their best customers, but many of whom today are disenfranchised and
looking for new alternatives to their conspicuous consumption lifestyle."

To assist marketers deal in the new normal luxury market AFTER the
recession, Pam Danziger has just published a white paper providing
highlights of her presentation at the recent Luxury Interactive
conference. A copy of the white paper is available here
http://www.unitymarketingonline.com/cms/Home/White_Papers/Luxury_Recession__The_
ood__Bad__Ugly.php

Among the key findings from the research:

-- The recession has brought wide spread changes in affluent consumers'
willingness to spend

The current recession has dramatically and sharply curtailed affluent
consumers' willingness to spend. This recession is unprecedented in its
negative impact on luxury marketers and retailers, who have catered
primarily to the wealthier segment of the population. This research shows
that a majority of affluent shoppers are changing their purchasing
patterns in light of the current economy.

80 percent agree with the statement, "I am thoughtful when I shop: I am
thinking more about whether I really need an item or just want to buy it
on impulse"

Affluents are widely responding to the current economic crisis by simply
sitting back and taking time off from spending haphazardly or impulsively.
A majority of affluents are taking concrete steps to change their shopping
and spending behavior in light of the recession. Among the most popular
money-saving strategies are to go shopping less frequently and to reduce
the number of times they dine out.

These changes in spending patterns are widespread. Further, the longer the
recession lasts, the more likely that affluents will learn new habits of
shopping that will carry over into the time after the recession. This
woman shopper explains how she is changing: "I am more thoughtful. I love
to shop. Now, I still love to shop, but I am trying to think more about
whether I really want and need this at this particular time, as opposed to
just getting things and have them sit in the closet and not wearing them."

-- Once the recession is over, the luxury market is never going to be the
same as it was -- A cultural shift is taking place in which people are
changing their priorities away from more and more consumption

In the focus groups, many people expressed the idea that the culture
is shifting and the times are changing. This woman sees a return to more
traditional values: "I am thinking that I should [make changes], there are
lessons to learn in this time and where our values are. So it is making me
think about that and priorities. And I think that it is a good shift in
consciousness that we are seeing in our own values."

Even after the economy improves, people aren't going to go back to buying
luxury like they used to -- 50 percent of those surveyed agree

Half of all luxury consumers surveyed, irrespective of gender, age or
income, agreed that people won't go back to buying luxury like they used
to.

Given the potential impact of a dramatic shift in affluent consumer
consciousness away from conspicuous consumption toward a more thoughtful,
reserved careful way of shopping and buying, the essential question for
luxury brands, luxury marketers and luxury retailers is "How do we make
the most of these changes in the mindset of our target customer? How do we
survive in a time of dramatic cultural shifts away from luxury indulgence
toward a more conscious, careful consumer mindset?"

Advice for Luxury Marketers about the Market AFTER the Recession

"The new normal for luxury marketers is simple: Once the recession is
over, the luxury consumer market is not going to go back to its
spend-thrift ways," Danziger advises.

"Affluent consumers are redefining, reassessing and reevaluating their
lives and their lifestyles. This is happening across the culture, not just
among a small segment of the affluent market and it will mean major shifts
in the way luxury brands can market their goods in the new economy.
Discounts and sales won't be enough. They will need to realign their
brands with the new values that more thoughtful, careful and selective
affluent shoppers hold," Danziger concludes.

To learn more about the 'new normal' and the research conducted for this
white paper, click here:
http://www.unitymarketingonline.com/cms_luxury/luxury/pr_main/After_Recession_5-
7-09.php

For media: Danziger available for interviews. Charts, tables and graphs
detailing major findings in the report also available.

About Pam Danziger and Unity Marketing

Pamela N. Danziger is an internationally recognized expert specializing in
consumer insights, especially for marketers and retailers that sell luxury
goods and experiences to the masses as well as the 'classes.' She is
president of Unity Marketing, a marketing consulting firm she founded in
1992.

Advising such clients as PPR/Gucci, Diageo, Google, Luxottica, Lenox,
Swarovski, Orient-Express Hotels, Italian Trade Commission, Marie Claire
magazine, The World Gold Council, and The Conference Board, Pam taps
consumer psychology to help clients navigate the changing consumer
marketplace.

Her latest book is "Shopping: Why We Love It and How Retailers Can Create
the Ultimate Customer Experience" (Kaplan, $27). Her other books include
"Let Them Eat Cake: Marketing Luxury to the Masses-as well as the
Classes," (Dearborn Trade Publishing, $27, hardcover) and "Why People Buy
Things They Don't Need: Understanding and Predicting Consumer Behavior"
(Chicago: Dearborn Trade Publishing, 2004).

Contact:
Pam Danziger
Unity Marketing
717-336-1600

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