Luxury Institute News

April 4, 2012

Wealthy Smartphone Users Like Angry Birds and Facebook

By Robert Frank
Wall Street Journal
April 3, 2012

Millionaires don’t get to be millionaires by playing games on their phones right?

Wrong. According a new study from the Luxury Institute, 73% affluent smartphone users (with an average net worth of $2.8 million) used smartphone apps every day. The most frequently downloaded apps for millionaires included Angry Birds, Facebook and Words with Friends.

Of luxury consumers with smartphones, 28% of them own an iPhone, 22% own an Android, 16% own a BlackBerry and 2% own another smartphone, the study said.

Click the link to read the entire article:

April 3, 2012

Wealthy smartphone users less likely to play games, tweet

Wealthier smartphone users are less likely to play games or tweet and will opt for news, travel or finance apps, according to a new study.

By Natasha Baker
April 2, 2012

The research by The Luxury Institute focused on app usage among wealthy consumers, who earn an annual income of $150,000 or more. They tend to be older, with a mean age of 52.

“As you get older and have family and significant others, aging parents, and a lot more assets and investments, you’re going to need apps for far more relevant things than playing games and chatting with your peers,” said Milton Pedraza, CEO of The Luxury Institute.

The findings are in contrast to smartphone usage as a whole, which research firm Nielsen showed is dominated by games and social networking categories.

The wealthy use Facebook and Angry Birds, the two most downloaded apps of 2011, but overall, higher-income consumers use apps for entertainment far less than the average smartphone user, according to Pedraza.

While wealthy consumers are only slightly more likely to have a smartphone than the general population, Nielsen said the breakdown of devices owned differs considerably.

Forty-five percent of wealthy smartphone users own an iPhone, followed 35 percent with an Android device and a quarter who had a Blackberry. But Nielsen found that overall Android had 46 percent of market share, followed by the iPhone with 30 percent and Blackberry with 15 percent.

“Google’s strategy with Android is that they have multiple manufacturing partners,” explained Jonathan Carson, the CEO of digital at Nielsen. “There’s a broader choice with Android in the number of devices, and that may offer some opportunities for lower-end consumers.”

He added that the iPhone has always done quite well with high-income consumers.

Carson also noted an upswing in the number of smartphone users adopting iPhones within the last few months, which he attributes to the iPhone 4S, and Apple’s strategy to keep lower-priced models on the market at lower-price points to appeal to a wider range of consumers.

The study also showed that more than 80 percent of affluent consumers have downloaded apps and many have opted for paid apps and in-app upgrades. But on average, wealthier consumers download about half as many apps as the average consumer.

Among wealthy smartphone users, 67 percent have used their mobile device to shop for products or services online with tickets, gift cards, food or electronics the most popular purchases.

“There are a large number of people that still love to shop in the store, and I don’t think it’s only older people,” Pedraza said, adding apps can augment the in-store experience.

The marketing firm Plastic Mobile polled 603 consumers whose mean income was $295,000 and net worth was $2.8 million for The Luxury Institute study.

March 27, 2012

67pc affluent smartphone owners use mcommerce: study

By Rachel Lamb
Luxury Daily
March 26, 2012

More than two-thirds of affluent consumers who own a smartphone have used their mobile device to shop for products and services, but since they prefer the in-store experience, luxury brands have to start creating humanistic experiences on mobile.

Preference for the in-store experience, the cornerstone of luxury marketing, is the main reason why smartphone owners say they do not buy products through mobile. Mobile applications are the most common form of engagement for affluent consumers, indicating that luxury marketers need to step up the in-app experience.

“Consumers are becoming so much more mobile and we need to figure out how to translate that mobility into a humanistic experience,” said Milton Pedraza, CEO of the Luxury Institute.

“Apps are becoming ubiquitous, so it’s what we do with them that make the experience more extraordinary that will make the difference,” he said. “How the app is being used by the consumer or to contact someone who represents the brand is now where the real opportunity lies.”

The Luxury Institute study was conducted over the first quarter of 2012.

Respondents reported an average net worth of $2.8 million.

Complicated commerce
Of the 67 percent of affluent consumers who shop via mobile, 63 percent of them have made purchases in the past 12 months, according to the study.

Furthermore, wealthy consumers who made purchases spent an average of $628.

Event tickets, gift cards, food and technology/personal electronics are the most-common type of mobile purchase, according to the study.

Preference to the in-store experience is the most-used reason for not making a mobile purchase.

However, other issues include “privacy and security issues,” “it seems complicated,” “the brands I purchase from do not offer mobile shopping” and “I don’t know how.”

Of luxury consumers with smartphones, 28 percent of them own an iPhone, 22 percent own an Android, 16 percent own a BlackBerry and 2 percent own another smartphone.

Of the 60 percent of affluent consumers in the United States who have a smartphone, approximately 73 percent of them use apps at least once per day, according to findings from the Luxury Institute.

Affluent consumers are using apps including Facebook, Angry Birds and Words With Friends, making them a prime spot for luxury mobile marketing. However, most high-end brands are not fully grasping the urgency that they not only need to be in mobile, but the leading innovators.

Of affluent consumers who own a smartphone, 80 percent of wealthy U.S. consumers report that they have downloaded an app.

Navigational and entertainment apps are the types of apps most frequently downloaded, including Facebook, Angry Birds and Words With Friends.

That said, these apps provide opportunities for luxury marketing. In fact, some brands have already taken advantage.

For example, department store chain Nordstrom is targeting aspirational consumers through mobile banner advertisements for its Nordstrom Rack locations in the popular gaming application, Words With Friends.

In addition, New York-based department store Bergdorf Goodman used Words With Friends to drive foot traffic to its store with a location-based banner ad promoting an in-house event.

However, what these results are telling marketers is that it is not just young consumers who enjoy gaming apps. The respondents of the study – older, more affluent consumers – are still citing Angry Birds, Facebook and Words With Friends as their favorite apps.

However, there is a fine line between marketing to adults and aspirational consumers.

“Brands do need to be as engaging as social media, but they cannot be gimmicky – they must be honest and real,” Mr. Pedraza said. “It is surprising that Facebook and games have reached all consumers, not just the young.

“That said, it is hard to extrapolate data over the next few years when technology and behavior are spending so quickly,” he said. “The speed of change among all consumers, not just the young but the old and affluent, is very quick.”

March 23, 2012

Wealthy U.S. Smartphone Users Reveal Details on Shopping, Spending and Use of Mobile Apps; Facebook, Angry Birds and Words With Friends Top List of Favorite Apps

(NEW YORK) Mar 22, 2012 — For the newly released WealthSurvey, “Mobile Apps And Commerce Among Wealthy U.S. Consumers,” the independent and objective New York City-based Luxury Institute, in conjunction with mobile agency Plastic Mobile, interviewed U.S. consumers earning at least $150,000 per year about their smartphones and how they use them for shopping and entertainment.

Apple is the dominant smartphone brand for high-income users. Of the 62% of wealthy Americans who own a smartphone, 45% have an iPhone, 35% use an Android-based device, and 25% own a BlackBerry.

More than 80% of wealthy smartphone users have downloaded mobile apps to their phone, and the most popular categories of downloaded apps are weather (63%), news (51%), travel (42%), business/finance (39%) and sports (34%). Wealthy users have downloaded an average of 15 mobile apps and use half of them frequently. Almost half (48%) of affluent consumers use five or fewer apps on a regular basis.

Facebook is the app used most frequently by wealthy smartphone users, followed by weather apps, maps, Google and the Safari browser. Facebook is also the app that wealthy smartphone users say is their favorite. Nearly as popular are the games Angry Birds and Words With Friends.

Top reasons for not downloading apps are lack of interest (49%) and a desire to keep phone functionality simple (32%). Not wanting to pay is a reason cited for not downloading apps by 20% of wealthy smartphone users, but 59% have paid for applications and 55% of those who have downloaded free apps have upgraded to pay versions. Two in five wealthy users are willing to pay for apps priced between $0.99 and $1.99, while 23% are okay with paying between $2 and $4.99 for a mobile app. Only 18% would pay more than $5.

With regard to commerce, 67% of wealthy smartphone users shop on their devices and 63% regularly buy goods or services. Half of shoppers make purchases at least monthly, with almost 80% spending more than $100 on mobile phone transactions in the past year, and 25% spending in excess of $1,000. Event tickets (39%), gift cards (29%), and food and electronics (both 27%) are the top purchase categories.

The chief reason for not shopping on mobile phones is preference for the in-store experience, cited by 51% of users who do not use their device for commerce. Another 29% say that privacy issues keep them from making purchases on their phones.

“The study showed an incredible opportunity for mobile in luxury,” says Melody Adhami, president and COO of Plastic Mobile. “Not only are affluent Americans using mobile, but they are really taking advantage of its benefits, with more than 80% of consumers downloading apps.”

“Smart luxury firms recognize the potential of their mobile presence to boost sales and get closer to their customers,” says Milton Pedraza, CEO of the Luxury Institute. “Customers clearly view smartphones as part of the new shopping experience.”

Respondents reported an average net worth of $2.8 million.

For details from this WealthSurvey and others, visit

About Luxury Institute (
The Luxury Institute is the objective and independent global voice of the high net-worth consumer. The Institute conducts extensive and actionable research with wealthy consumers about their behaviors and attitudes on customer experience best practices. In addition, we work closely with top-tier luxury brands to successfully transform their organizational cultures into more profitable customer-centric enterprises. Our Luxury CRM Culture consulting process leverages our fact-based research and enables luxury brands to dramatically Outbehave as well as Outperform their competition. The Luxury Institute also operates, a membership-based online research portal, and the Luxury CRM Association, a membership organization dedicated to building customer-centric luxury enterprises.

November 3, 2011

David Yurman goes mcommerce after Web traffic jumps 200pc

By Kayla Hutzler
Luxury Daily
November 2, 2011

Jewelry designer David Yurman decided it was time to create a mobile commerce-enabled site after the New York-based Luxury Institute revealed that more than 20 percent of consumers with at least $5 million in net-worth were shopping through mobile devices.

The new site, powered by the Createthe Group CTS platform, allows consumers to browse, search and buy products as well as find nearby stores. David Yurman is confident that the mobile commerce site will deepen engagement with consumers since the brand has already seen a 200 percent increase in Web site traffic from its previous mobile efforts.

“By providing the mobile site, David Yurman can offer an ideal enhanced and optimized shopping experience for consumers by letting them shop from wherever they please,” said Allen Kung, cofounder and chief technology officer of Createthe Group, New York.

“Affluent consumers are increasingly using the mobile channel to find products and discover product information and good deals, as well as purchase products,” he said. “Therefore, luxury and premium brands are investing more heavily in mobile commerce experiences to keep them engaged.”

Register rings

While David Yurman did have a mobile-optimized site for the past five years, which was also powered by the Createthe Group platform, this marks the first time that consumers will be able to purchase products through their mobile phones.

Indeed, the brand saw the need to create a mobile site based on third-party research from the Luxury Institute and PayPal, along with its personal experience – overall Web site traffic jumped after implementing mobile channels.

The new site is easily navigated and can be found at

The homepage features a vertical bar with tabs for shop, style, stores and search.

Tapping on the style tab bring consumers two options – “celebrity and events” or “shop the campaign.”

Within these sections, consumers can shop the products they discover by tapping on a “view products” box in the image.

Back on the homepage, there is also an campaign picture, followed by a vertical navigation bar that lists seven options: women, men, timepieces, gifts, collections, eyewear and fragrance.

Within each of the vertical bar tabs are a number of subcategories such as new arrivals, best sellers, rings and bracelets.

Check it out
When a consumer is done browsing and has added her desired products to the shopping bag, the checkout process is smooth and hassle-free.

Consumers have a few options after they wish to check-out. They can sign-in to their accounts, register for an account or simply check-out.

Not requiring consumers to create a username is a smart move since many consumers are likely in a rush when they are shopping on their mobile phones.

The mobile site also features a location-based store locator for consumers who prefer to buy products in-store.

David Yurman wanted to launch the new mobile site just in time for the holiday season since many of its best consumers are busy executives with little time to shop, according to Carol Pennelli, the brand’s president.

The shift to a mobile commerce experience was relatively easy since the jeweler was already using the CTS platform, according to Createthe Group’s Mr. Kung.

“The David Yurman mobile commerce experience is not just another cookie-cutter mobile site experience,” Mr. Kung said. “The beauty and elegance of the David Yurman brand was not lost in the execution and creative interface design.

“[Consumers] will [now] enjoy the greater speed, ease and convenience of shopping on-the-go from anywhere they please at any time of the day,” he said. “It will make holiday shopping faster and easier for time-pressed shoppers as well as discriminating affluent consumers searching for the most unique and perfect gifts.”


May 4, 2011

The Tastemakers

How Generation Y is helping to save luxury brands

By Fiona Soltes
May 2011

In the first quarter of 2011 alone, the British luxury brand added more than 600,000 “likes” to its Facebook page. At that rate, it’ll reach 10 million by the middle of next year…

…Milton Pedraza, CEO of research firm Luxury Institute, says “legacy” products are key, and that’s where luxury brands are gaining ground. Millennials typically view expensive purchases as necessary investments in themselves – falling more into the “need” than the “want” category – but “people still don’t spend as much on luxury as they did before,” he says…

Click the link to read the entire article which includes several additional quotes from Milton Pedraza, CEO of Luxury Institute:

May 2, 2011

Is Twitter an effective traffic driver to luxury stores?

By Rachel Lamb
Luxury Daily
April 29, 2011

Twitter is often used as a forum where brands can communicate with consumers to inform them of special deals, in-store events and online exclusives. But does it actually do its job - drive sales to retail and online locations?

Brands, retailers and hotels such as Bloomingdale’s, Stella McCartney, Bluefly, Bergdorf Goodman and Four Seasons are actively tweeting messages that drive in-store or online conversions, which is the main reason these companies even use the social media site. The messages are short and to the point, with all signs pointing to sales.

“When we talk to luxury consumers, they consider Twitter the second-most prominent social media channel for them, aside from Facebook,” said Milton Pedraza, CEO of the Luxury Institute, New York.

“I think that consumers see a lot of a service or an opportunity to report to a brand and get an immediate response,” he said. “They usually don’t use it to get main brand information, but it’s a great source for product referral and product feedback, both to and from the brand and consumer.”

Some brands find that Twitter is the easiest way to link to products on Web sites or to tell their customers about online-only  finds.

For instance, Bluefly, an online retailer of discount designer accessories and apparel, enthusiastically tweeted about a must-have bag available on the commerce-enabled Web site.

An excited, cheery tweet could act as the fire lit under the customer that is on the edge of buying an item.

“The nature of Twitter is relevant and instant,” Mr. Pedraza said. “In that sense, it has its uses.

“It is not a place where you’re going send a lot of product information, but you will get influenced on a transaction, purchase, referral or review very quickly and that’s what the greatest use is going to be over time,” he said.

Meanwhile, Four Seasons uses Twitter to communicate to its customers about upcoming events.

To promote its Mother’s Day package, the hotel is encouraging its customers to look at details and possibly snag the deal.

By hitting a sweet spot for many consumers – humor and, of course, their mothers – Four Seasons succeeds in hooking potential guests.

Also, this could just be the brand’s way of reminding customers who could have forgotten about the package.

Either way, the possibility of money spent at the hotel or on its site is great.

Luxury brands that tweet can also benefit from consumers who check their Twitter accounts via smartphone.

If an on-the-go affluent consumer happened upon a Stella McCartney tweet encouraging her to shop the new collection, the brand could benefit from a last-minute mobile purchase.

This is also where having a mobile-optimized site comes in handy for easy access of products, which will lead to buying.

Bricks click
Brands can also use Twitter to send customers to retail locations.

Retailers such as Bloomingdale’s and Bergdorf Goodman  use the social network to alert customers about in-store events.

Bloomingdale’s woos Miami-based consumers with free makeup lessons from an executive at a popular brand, based on a recent tweet.

New York-based department store Bergdorf Goodman takes it a step further with an embedded image that shows products in the store.

The retailer also tweeted about an in-store event featuring these bags beforehand, further encouraging consumers to come to the store, shop and possibly meet a fashion industry icon.

This is appealing to the affluent consumer because Twitter is a personal experience, especially if a customer is directly messaged, is re-tweeted or mentioned by the brand.

Connecting personally with a brand will encourage loyalty in all mediums.

“Twitter allows the brand to communicate on a more personal level with the consumer, as well as to provide up-to-the-minute brand news,” said Isabella Josefsberg, community manager at Spring Creek Group, Seattle.

“Twitter can be used by brands to solidify the brand personality and reputation, as well as to help consumers connect with the brand,” she said. “Twitter also allows consumers who are fans of the brand, but may not necessarily have the means to purchase luxury items, to participate in the brand experience.”

December 14, 2010

Ralph Lauren is 2010 Luxury Marketer of the Year

By Peter Finocchiaro
Luxury Daily
December 13, 2010

…Ralph Lauren earned praise for the manner in which it weathered the economic storm of 2008 and 2009, emerging stronger than ever this year.

The brand opened new flagship locations, expanded its ecommerce and mobile operations, and maintained the quality of service that has helped distinguish its retail experience.

“Ralph Lauren creates in the mind-set of consumers a lifestyle that they feel they are attaining and accessing through its products,” said Milton Pedraza, CEO of the Luxury Institute, New York. “He’s done that for years, but really sharpened the focus to make it a wonderful art and science of luxury.

“[The brand] should be a wonderful example for luxury – especially during the recession – of how to manage the equity of a premium or luxury brand intelligently and in a financially powerful way,” he said.

“In the last two years, coming out the recession, Ralph Lauren has really shown the world how you can be resilient and how you can scale and how you can still do that and maintain your prestige and relevance as a brand.”

In the end, for Ralph Lauren, marketing is all about a narrative.

“This company was founded 45 years ago – it started with a tie,” Mr. Lauren said. “That tie was designed to tell a story about a world.

“The brand was called Polo because it gave you the feeling of a luxury world on and off the sports field,” he said. “Every aspect of our brand brings you into a world rich with imagery – like stepping into a movie.”

Click the link to read the entire article:

November 22, 2010


In contrast with their reputation as leaders on catwalks the world over, luxury brands have perfected the slow embrace when it comes to technology. Will it be to their detriment?

By Hannah Tattersall
The Australian Financial Review
November 19, 2010

It’s 1am in Sydney. A woman wakes up and turns on her iPad. She opens her Burberry app and goes to the latest catwalk parade live from London Fashion Week. She zooms in on a model sporting a trench coat, moving her cursor from the shoulder of the garment down to its belt. As soon as the show finishes, she logs her interest and waits for a customer service representative to call and take her details. 

In six to eight weeks – four months ahead of its arrival in store – she receives her product. 

This ecommerce initiative, which ran for a week after the recent London show, was a world first, the brainchild of Burberry chief creative officer, Christopher Bailey.  So excited was he by the move, after the show he tweeted that the fashion house was “now as much a media content company as a design company because it’s all part of the overall experience”. 

Burberry has 2 million fans on Facebook.  Conservative by nature, luxury brands such as Chanel, Gucci, Louis Vuitton and Bulgari have been slow to embrace ecommerce. They pride themselves on the store experience they offer customers. And that experience -with personal service (champagne at times), and a touch and look approach – cannot be recreated online. Furthermore, these brands argue, even if you could sell luxury online, the affluent consumer isn’t interested.

Until now.

In October, New York based Luxury Lab released its second annual L2 Digital IQ Index of 72 luxury brands, ranking websites and mobile applications, digital marketing strategies and social media initiatives to quantify brands’ digital competence. Coach ranked number one, Ralph Lauren two and Burberry six. 

A Luxury Institute survey found 34 per cent of affluent respondents have downloaded apps to their smartphones, with another 11 per cent saying they intend to do so in the near future. 

Luxury brands are now scurrying to be recognised as having the knowhow to compete in a digital world. “Today, nobody questions doing ecommerce,” Milton Pedraza, Luxury Institute chief executive says,”but a few years ago there was a silly debate in the luxury industry about whether they should sell online or not. That’s been put to rest.”

Pedraza says this is because luxury brands were in the “same constellation but not of the same planet as mass brands”.

They didn’t see the web as able to replicate the store experience, without which, they believed, luxury brands weren’t luxury.

“They weren’t like; they weren’t like,” Pedraza says.  “They didn’t quickly embrace the convenience factor of the internet. They were afraid of it.”

He says it’s time luxury brands moved away from Flash sites that take minutes to load and annoy users, to embrace mobile applications.

Sites such as Foursquare can inform sales staff when clients enter a store. “Luxury needs to use that as the centrepiece to groom relationships,” he says. “You’re using the mobile device to enhance the consumer and also to enhance the sales professional and make it easier to interact between the [two].” 

The biggest mover and shaker in the luxury market, Asia, has spurred the need for brands to recognise online mechanisms globally. A 2008 study by KPMG International found Asian respondents felt most comfortable making financial transactions on their mobile.

Luxury brand consultant Melinda O’Rourke says in China alone, 60 to 70 per cent of luxury consumers are 20 to 27 years old. “Luxury brands have to look overall at their strategies because for the first time there’s such a big youth market,” she says.

Many global brands are yet to view Australia as a profitable market – in critical mass terms, we are not as important as China or the US. But Australia proved it was a robust market when it came through the global financial crisis relatively unscathed. And with our dollar at parity with the US dollar, Australians are embracing online retail in droves. We are the third biggest users of luxury shopping site NetAPorter, where the average annual spend per Australian customer is £728 ($1190), when the international average is £313.

In a survey conducted by O’Rourke’s firm, MO Luxury, in Australia in September, 57 per cent of respondents claimed to have visited luxury beauty websites. O’Rourke says NetAPorter has increased confidence in the online luxury market. The Richemont Group bought a 33 per cent stake in NetAPorter in April.

Associate professor of marketing at Melbourne Business School and luxury brand consultant Mark Ritson says luxury brands like to break rules and push fashion forward.

“But when it comes to business strategy, that’s not the case,” he says. “In business strategy, most luxury brands take pride in moving very slowly . . . they think about things in a decade or double decade way.”

While other luxury brands might see Burberry as a shelf down from them in the luxury store, Bailey’s moves in the online world have not gone unnoticed.

Francesco Trapani, chief executive of Bulgari, says his luxury house has “made a massive leap in the scope and sophistication of its online initiatives” in the past few years. It has a Facebook page about its brand, products, events and activities around the world, shares campaign videos on YouTube, and uses Twitter in the US to engage with customers – it has about 4000 followers.

“We’re evaluating the roll out of Twitter to other markets, but to date we haven’t seen high demand for it elsewhere,” Trapani says. “Expect to see more mobile activity next year.”

His company has noted an increase in product research and brand engagement online, he says. For now, however, it has no plans to launch online shopping in Australia.

Juliet Fallowfield, Chanel Australia and New Zealand’s corporate communications manager, says the company has been streaming shows from Paris to Australia within 24 hours, allowing consumers to watch and zoom in on product detailing. But it has not yet embraced ecommerce and she is unaware of any plans to do so. Chanel has a Facebook page and uses its website to alert consumers to news and announcements.

One thing Facebook can’t provide is tangibility. “Our customers are aware they receive more than just access to the physical product when they visit Chanel,” she says. “They won’t just come in, have a look and hear about the price. They’ll have the expert advice, the tailored Chanel environment, which gives a complete luxury experience.”

Trapani agrees the luxury consumer expects more than what can be provided by mobile and online devices, particularly when it comes to the brand’s high end jewellery ranges.

“Each high jewellery purchase is a major investment from both financial and emotional perspectives, so the human touch is vital,” he says. “In comparison, customers who purchase our fragrances need an initial physical experience to learn about the scent, but once they’ve become a fan of a particular scent, they generally prefer the convenience of finding the product online.”

Critics, however, say by being so accessible, brands risk losing the exclusivity that comes with being a true luxury brand. “Brands have to compete and make sure they’re relevant,” Pedraza says. “But they still need to show they’re a luxury brand. The risk with moving online is that anyone can access the brand.”

With social media “anyone can be involved, have a dialogue,” O’Rourke says. “And although they’re very consumer focused these days, it’s still about coming to our house and respecting our rules. We’ll serve our clients but we’ll serve them in our own environment.

“What’s fundamental is luxury is very much about the experience . . . Luxury brands are all about control. They have beautiful stores you walk into, this seamlessness, whether it’s Tokyo, London, New York, Sydney or Melbourne. There’s a consistent look. They can control their environment, everything from product to the store’s look, staff, knowledge.

September 28, 2010

The Mobile Apps That Affluents Download

Wealthy smartphone owners use an average of seven apps on a regular basis

By Tobi Elkin
Monday, September 27, 2010

More than one-third of wealthy Americans have downloaded apps to their smartphones and another 11% plan to do so in the near future, according to the Luxury Institute‘s September 2010 “Wealth Report.”

The Institute polled smartphone owners earning at least $150,000 per year (the average income was $247,000) and found that 61% of them paid for at least some of their apps. Similarly to average smartphone owners, affluent users polled downloaded weather-related, news and gaming apps the most.

Leading Mobile Applications Downloaded by US Affluent* Smartphone Users**, 2010 (% of respondents)

The survey found that 40% of affluents downloaded travel apps and 39% business-related apps. The findings suggest that there are plenty of opportunities for luxury marketers to do in-app advertising and content sponsorships within apps. Interestingly, the majority of affluents were willing to pay for apps and spent an average of $84 in the past year on downloads. Further, the survey found 24% the affluents polled are willing to pay between $2.00 and $4.99 for an app.

Downloading apps is only part of the equation-wealthy smartphone users report using an average of seven apps on a regular basis, with 57% using five or fewer apps at several points during the day. Repeat usage is the key for luxury brands looking to get into the palm of their customers’ hands.

Mobile Applications Most Frequently Used by US Affluent* Smartphone Users**, 2010 (% of respondents)

The survey noted that nearly one-third of affluents who have downloaded apps have downloaded consumer brand apps for shopping and for product and store location information. Affluents are using mobile comparison shopping sites as well, Milton Pedraza, CEO and founder of the Luxury Institute, told eMarketer.

High-end brands such as BMW, Mercedes-Benz, Ralph Lauren, Louis Vuitton, Chanel and iLuxury were the top branded apps downloaded by affluents. The top three functions performed with these mobile apps, each cited by 63% of those who had downloaded them, are clicking through to a website, communicating with others and locating a store. More than half (53%) of users look up product or service information and 30% actually make purchases via an application.

Retailers and brands that have mobile apps create favorable impressions with affluents-56% of wealthy respondents said they view brands with mobile apps as “innovative” and “cutting-edge,” according to the survey.

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