Luxury Institute News

July 3, 2013

Survey: Wealthy Women Prefer Jewelry From Tiffany & Co.

Tiffany & Co. is the jewelry brand most widely purchased by ultra-wealthy women, according to a study by The Luxury Institute.

By Daniel Ford
JCK Online
July 2, 2013

The institute surveyed ultra-wealthy U.S. consumers with minimum net worth of $5 million about luxury brands they buy and the relationships they have with luxury sales professionals.

David Yurman and Cartier followed Tiffany on the list. The women surveyed said they have a preferred salesperson at all three jewelers. And never underestimate the power of the pen: 
More than half of ultra-wealthy women who purchase from both jewelry and fashion brands say they appreciate handwritten thank-you notes.

“Relationship selling is not something exclusive to markets like high-end automobiles, real estate and wealth management services,” said Luxury Institute CEO Milton Pedraza in a statement. “Even in luxury jewelry and fashion, relationships cultivated by trust and an understanding of customer preferences can help boost both the frequency and size of sales.”

July 2, 2013

Tiffany Leads Purchases for Ultra-Wealthy Women

By Danielle Max
International Diamond Exchange (IDEX)
July 1, 2013

(IDEX Online News) – Forget Breakfast at Tiffany’s, ultra-wealthy women are ordering lunch, dinner and a midnight snack at the luxury jeweler. According to the latest survey by the Luxury Institute, Tiffany & Co. is the go-to jewelry brand for individuals with a minimum net worth of $5 million.

David Yurman and Cartier follow Tiffany in the spending stakes. And it’s not just because of product offering. The survey found that the three market leaders are also the top three jewelers where ultra-wealthy women have a preferred salesperson.

“Relationship selling is not something exclusive to markets like high-end automobiles, real estate and wealth management services,” said Luxury Institute CEO Milton Pedraza. “Even in luxury jewelry and fashion, relationships cultivated by trust and an understanding of customer preferences can help boost both the frequency and size of sales.”

The survey also found that ultra-wealthy men are less likely than women to build relationships with salespeople.

Pentamillionaire men and women both agree that the top ways salespeople build lasting relationships are by making them feel comfortable, communicating honestly, earning their trust and recognizing them on store visits.

More than half of ultra-wealthy women who purchase from both jewelry and fashion brands say they appreciate handwritten thank you notes.

http://www.idexonline.com/portal_FullNews.asp?id=38312

June 27, 2013

Wealthiest U.S. Women Find Jewelry And Relationships At Tiffany, David Yurman And Cartier; Ralph Lauren And Brooks Brothers Suit Pentamillionaire Men

(NEW YORK) June 27, 2013 – The Luxury Institute surveyed ultra-wealthy U.S. consumers with minimum net worth of $5 million about luxury brands they buy and the relationships they have with luxury sales professionals.

Tiffany & Co. is the jewelry brand most widely purchased by ultra-wealthy women, followed by David Yurman and Cartier. These three leaders in market share are also the top three jewelers where ultra-wealthy women have a preferred salesperson.

In the women’s fashion and accessories category Michael Kors holds a commanding 36% market share, followed distantly by Prada, Burberry, Louis Vuitton, Chanel, Gucci and Marc Jacobs.  These top seven brands vary widely in their ability to build relationships with ultra-wealthy women, with Marc Jacobs falling behind the rest while Prada leads the pack.

Among pentamillionaire men, Ralph Lauren and Brooks Brothers hold the largest market share in the men’s fashion and accessories category.  Overall, ultra-wealthy men are less likely than women to build relationships with salespeople.

Pentamillionaire men and women both agree that the top ways salespeople build lasting relationships are by making them feel comfortable, communicating honestly, earning their trust and recognizing them on store visits. More than half of ultra-wealthy women who purchase from both jewelry and fashion brands say they appreciate handwritten thank you notes.

“Relationship selling is not something exclusive to markets like high-end automobiles, real estate and wealth management services,” says Luxury Institute CEO Milton Pedraza. “Even in luxury jewelry and fashion, relationships cultivated by trust and an understanding of customer preferences can help boost both the frequency and size of sales.”

About Luxury Institute (www.LuxuryInstitute.com)
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 LuxuryBoard.com, a membership-based online research portal, and the Luxury CRM Association, a membership organization dedicated to building customer-centric luxury enterprises.

June 3, 2013

Can the Tysons malls stay on top?

By Abha Bhattarai
Washington Post
June 2, 2013

Fourteen years after Spanx was founded, company executives began scouting locations for their first-ever retail store.

The answer, they say, came quickly: Tysons Corner Center in McLean.

“We needed somewhere where we could reach mothers, daughters and grandmothers all in one place,” Spanx founder Sara Blakely said at the time of the store’s opening, late last year. “The [Tysons] area already had a strong customer base online. It was a very good location for our first store.”

It was the same model Apple had followed more than a decade earlier, when it picked the mall as the site of its inaugural retail store. In the years since, Tysons Corner Center and its upscale sibling, Tysons Galleria, have become coveted launch pads for big-name brands entering the Washington market.

Click the link to read the entire article which includes several quotes from Milton Pedraza, CEO of Luxury Institute: http://www.washingtonpost.com/business/capitalbusiness/can-the-tysons-malls-stay-on-top/2013/05/31/f47ea49a-c7c9-11e2-8da7-d274bc611a47_story_1.html

March 25, 2013

Forget Tupperware parties. Local trunk shows offer exclusive access.

By Abha Bhattarai
Washington Post
March 22, 2013

Forget the mall. Your next clothing purchase could take place in a local hotel, hair salon or art gallery.

Washington area businesses such as the Four Seasons and the Northern Virginia Art Center have played host to designer trunk shows in recent months, as businesses look for new and unconventional ways to bring in money.

For clothing and accessories companies, the short-lived events provide an easy way to rack up sales without investing in store fronts or pop-up locations.

Click the link to read the entire article which includes several quotes from Milton Pedraza, CEO of Luxury Institute:
http://www.washingtonpost.com/business/capitalbusiness/forget-tupperware-parties-local-trunk-shows-offer-exclusive-access/2013/03/22/20a54950-8ff5-11e2-bdea-e32ad90da239_story.html

March 22, 2013

Affluent women control 68pc of household purchases: Luxury Institute

By Erin Shea
Luxury Daily
March 21, 2013

Affluent female consumers are making 68 percent of their household’s purchases, while more women are becoming the bread winners of their families, according to a new survey from the Luxury Institute.

Women are now more involved in purchasing and financial decisions for the family than ever before. Since this trend is likely to continue, luxury marketers should look to target affluent women to drive sales.

“This means that [marketers] need to pay more attention to how they are marketing to women in a respective and relative way,” said Milton Pedraza, CEO of the Luxury Institute, New York.

“A lot of companies are doing a good job of marketing to women, but we will see more companies and more services that will begin to market to women,” he said.

The Luxury Institute’s WealthSurvey: Marketing to Wealthy U.S. Women study surveyed 800 U.S. women who are 21 years or older and have a minimum gross annual income of $150,000. The survey took place in the last quarter of 2012.

The bread winners

Two-thirds of women surveyed earn at least $150,000 per year from their own salaries. This group of women has a median annual income of $181,000 per year.

More than 40 percent of working women in married or coupled households report being responsible for the majority of their total household income.

Seventeen percent of women surveyed said they provide support for additional familiar members other than their spouse or children. A quarter of these women said they spend at least $100,000 per year on providing support.

In addition, approximately 25 percent of working women are owners or partners in organizations. These women say that the flexibility in schedule and desire to “be my own boss” drove them to this situation.

The number of women in high-leadership roles and entrepreneurial positions will continue to increase.

This could mean an overall shift in corporate atmosphere, which could help marketers reach female consumers.

“We see a growth in women in the highest level in entrepreneurial and leadership positions that will make corporations more collaborative internally and externally,” Mr. Pedraza said.

“Most women understand the needs of other women, women consumers and other consumers.”

Purchasing power

Affluent women are most likely to control the food and clothing – such as apparel, shoes and accessories – purchase decisions for their household.

This group makes approximately 68 percent of the purchases on behalf of their household.

When purchasing, these women have a decided preference for products that are made by established and well-known brands.

Many luxury marketers target this group of affluent women because of their buying power, but some industry sectors are sending a stronger message than others.

The survey found that fragrances and cosmetics, clothing, shampoo and conditioner, shoes, department stores and jewelry and watches are categories that most effectively market to women.

Also, 65 percent of women in married or coupled households are making investment decisions jointly or in consultation with their spouse or partner.

Twelve percent of affluent women surveyed said that someone else makes these decisions for them, so there will likely be more financial services and similar companies that will begin to market to female consumers.

“We’ll see a lot of brands in the financial services and brands that are at the bottom try to understand how to develop and brand products to women,” Mr. Pedraza said.

http://www.luxurydaily.com/women-control-68pc-of-household-purchases-luxury-institute/

March 18, 2013

Women Earn The Big Money In Wealthy Families, And Decide How It’s Spent

(NEW YORK) March 18, 2013 – The independent and objective New York-based Luxury Institute surveyed wealthy women from U.S. households earning at least $150,000 a year about their economic situation, personal aspirations, family responsibilities and companies and industries successfully marketing to them.

Wealthy women are economic engines within their families, with 67% employed or running their own businesses; 41% report earning more than half of their family’s total income, up sharply from 27% who were bigger breadwinners in 2008. Women have been earning college degrees at higher rates than men since 1985, and educational attainment has produced economic muscle: median salary of the working women surveyed is $181,000; 66% earn more than $150,000, and 20% have annual incomes of $300,000 or more.

“Luxury executives should know that given the trends we see now, we predict that the Millennial women will achieve parity or surpass the achievements of their male counterparts in managerial, entrepreneurial, income and net worth levels in the next 2 decades,” says Luxury Institute CEO Milton Pedraza.

Despite career prowess, 90% of women 35 and older say that their most important aspect of life is family, and 34% say that their long-term career goal is to retire and enjoy more family time. Women control a majority of spending in 78% of households, with food (85%), clothing (78%), shoes (78%), and vacations (62%) also especially dominated by women.

“Shifting gender roles require brands in traditionally male dominated industries to connect with strong, successful women, but new marketing campaigns are not enough,” says Pedraza. “Companies must drive engagement through channels like social media and one-to-one communication with empowered sales professionals who serve as brand ambassadors.”

About Luxury Institute (www.LuxuryInstitute.com)
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 LuxuryBoard.com, a membership-based online research portal, and the Luxury CRM Association, a membership organization dedicated to building customer-centric luxury enterprises.

February 18, 2013

Chris Burch Becomes a Billionaire as Fashion Stock Surge

By Seth Lubove
Bloomberg
February 15, 2013

J. Christopher Burch, the former husband of designer Tory Burch, has become a billionaire amid a bull market for fashion companies.

Burch, 59, controls a portfolio of fashion and technology companies through investment firm Burch Creative Capital. His biggest asset is a 15 percent stake in Tory Burch LLC, the New York-based retailer that sells high-end women’s clothing and accessories, including popular ballet flats adorned with the company’s double-T logo.

His stake in Tory Burch is valued at $530 million, according to the Bloomberg Billionaires Index, giving him a net worth of more than $1.2 billion. He is at least $200 million wealthier than his ex-wife.

“There’s a sense of optimism out there,” said Milton Pedraza, chief executive officer of Luxury Institute LLC, a New York-based research and consulting firm, in a phone interview yesterday. “All these companies have a very robust market to draw from.”

Fashion stocks have surged in the past year. Italy’s Prada SpA (1913) is up 67 percent and New York-based Michael Kors Holdings Ltd (KORS). shares have risen 47 percent. Germany’s Hugo Boss AG (BOSS) is up 23 percent.

Burch declined to comment on his net worth, said Devon Spurgeon, a spokeswoman for him at H&K Strategies in New York. Frances Pennington, a spokeswoman for Tory Burch LLC, didn’t return an e-mail message seeking comment.

Disputes, Divorce
Burch also owns stakes in Poppin, an online office supplies retailer; Powermat Technologies Ltd., a maker of wireless chargers for electronic devices; and Jawbone, which makes Bluetooth headsets, wireless music speakers, and wristbands that track its wearer’s physical activities.

His first success came with Eagle’s Eye, a designer sweater company he started with his brother Bob in 1976, with a $2,000 investment. The brothers sold the company in 1998, at a value of $60 million, according to the Burch Creative Capital website. He reinvested the proceeds into more than 50 startup companies.

The couple opened the first Tory Burch retail store in New York in February 2004. They divorced two years later. Burch sold about half of his stake in Tory Burch on Dec. 31, settling a three-month legal dispute between the couple.

In the suit, Burch alleged his ex-wife impeded the success of C. Wonder, a fashion retailer he started in 2011 that sells blouses, blazers and shoes at 10 retail stores and four pop-up shops in the U.S. Burch accused her of sending staffers to interrogate C. Wonder employees. She responded in a counter- claim that C. Wonder produced a “cheapened, lower quality” knockoff.

‘Strategic Asset’
Women’s Wear Daily reported on Feb. 5 that Burch sold 10 percent of C. Wonder to FMR LLC, the parent of Fidelity Investments, for $35 million, valuing the company at $350 million. Sophie Launay, a Fidelity spokeswoman, declined to comment.

Burch also owns homes in New York, Southampton on Long Island, Nantucket, and on the Indonesian island of Sumba.

Omar Saad, an analyst with International Strategy & Investment Group LLC, says Tory Burch could sell shares in an initial public offering in the future. He wrote in a January research report that the retailer could also be “a highly prized strategic asset” to a buyer such as Coach Inc.

“Look at the economic power of women,” Pedraza said. “Accessories, even more than clothes these days, make the statement of who you are. They help define you.”

http://www.bloomberg.com/news/2013-02-15/chris-burch-becomes-a-billionaire-as-fashion-stock-surge.html

Consignment site helps ‘snobs’ swap high-end goods

By Abha Bhattarai
Washington Post
February 15, 2013

The search for a used Chanel bag led Elise Whang out of her job as an attorney and into a new career as co-founder of Snob Swap, a Web site that allows users to buy, sell and swap pre-owned designer goods.

Whang was pregnant with her second child when she had the idea for an online consignment shop. She decided to quit her job at the Federal Trade Commission to start Snob Swap with her sister.

“I got a little tired of chasing the mythical work-life balance,” said Whang, 37. “I just thought, it’s time for a change. I was tired of that flea-market feel of consignment sites. And I was also tired of half the stuff in my closet.”

Click the link to read the entire article which includes a quote from Milton Pedraza, CEO of Luxury Institute:
http://www.washingtonpost.com/business/capitalbusiness/consignment-site-helps-snobs-swap-high-end-goods/2013/02/15/c2d429c4-749f-11e2-aa12-e6cf1d31106b_story.html