Luxury Institute News

September 17, 2015

What The Apple Watch Hermès Tells Us About the Future of Tech and Luxury

By: Eustacia Huen
September 17, 2015

Last week, Apple unveiled Apple Watch Hermès, a new collection of Apple watches that links the tech giant with French fashion house Hermès for a striking opening act to fashion month. The new watches in stainless steel feature an etching of Hermès signature and a customizable face with three exclusive dial designs inspired by Clipper, Cape Cod and Espace Hermès watches.

Joined by the brands’ mutual focus on design, the Apple Watch Hermès is a result of what Pierre-Alexis Dumas, artistic director of Hermès called “an alliance in excellence; like horse and carriage, a perfect team.” Beyond the obvious strategic move of two companies at the top of their games, the partnership holds implications about the future of tech and luxury.

First of all, there is the obvious progression of tech products becoming more luxury-oriented, and luxury products becoming more tech-oriented. The Apple Watch is unique for having no visible Apple logo when the product is being worn. Giving Hermès the limelight, Apple is able to reach out to an affluent yet fashion-centric audience that was not previously reachable. Coupled with the fact that Apple shelled out for plenty of advertising pages in Vogue and delivered devices to models, the brand sends a clear signal that it’s trying to sell the Apple watch to the fashion world. As for Hermès, a 178-year-old brand famous for its iconic handbags and leather goods, entering any partnership like this is a rare yet strong statement that it wants to be viewed as contemporary.

With Apple wanting a luxurious edge, and Hermès hoping to branch out from their ‘wealthy grandmother and mother’ clientele, the Apple-Hermès partnership also informs us about the millennial demographic targeted by both companies, according to Milton Pedraza, CEO of the Luxury Institute.

Perhaps the best way to understand the demographic, as the luxury expert noticed, is the pricing of the watches. Ranging from $1,100 for the 38mm stainless steel case with the Single Tour (single band) to $1,500 for the 42mm stainless steel case with the cuff, the Apple Watch Hermès is not the most expensive watch for either brands.

While I think the Apple Watch Hermès could benefit from more refined elements from Hermès and more technological features from Apple, it’s a decent first attempt nonetheless. According to Pedraza, the collaboration is significant as it marks the transitional period before millennials become fully capable as primary consumers. And during this “period of positive disruption and innovation,” there are a few things he said we should expect: “Even fewer people will visit actual stores, and future products—whether they are in the tech or luxury market—will become more experiential.”


August 10, 2015

The Death of the Swiss Fine Timepiece Has Been Greatly Exaggerated

The Lilian Raji Agency
By: Lilian Raji
August 10, 2015

Late last month, Edward Faber, co-owner of Aaron Faber Gallery and author of  American Wristwatches: Five Decades of Style and Design,  Gary Girdvainis, editor of WristWatch magazine and AboutTime magazineand Jeffrey Hess, CEO of Ball Watch USAMilton Pedraza, CEO and Founder of The Luxury Institute, and Jason Alan Snyder, Chief Technology Officer of Momentum Worldwide reconvened Aaron Faber Gallery’s annual Watch Collectors’ Roundtable to debate the question, “Will Smartwatches Disrupt the Swiss Watch Industry?” The Roundtable was moderated by Eleven James CEO, Randy Brandoff.

With the recent  release of a report by market research firm Slice Intelligence announcing that Apple watch sales have declined 90% since their initial launch, the unanimous predictions of the Roundtable panelists has been proven accurate:  no, smartwatches will not disrupt the Swiss watch industry.

What the panelists couldn’t agree on, however, was if smartwatches would impact the industry in any way.

  • Jeff Hess, who also owns Hess Fine Art, noted his customers have been coming in wearing a smartwatch on one wrist and a fine Swiss timepiece on the other.  In this, there seems to be the possibility of harmony between the two types of watches.
  • Edward Faber asserted that a smartwatch will never seem as prestigious as walking into a boardroom wearing a Rolex Presidential or other high status watch.  Smartwatches will only be a gadget.
  • Milton Pedraza agrees on the novelty factor of watches, but didn’t dismiss that smartwatches could ultimately be more a fashion statement than a power statement.
  • Gary Girdvainis predicted that smartwatches would ultimately become gateways for the millennials who gave up watches for their smartphones to now begin entertaining the idea of wearing a watch.  When these same millennials reach their 30s, after spending the last few years wearing a smartwatch, graduating to a Swiss timepiece will be their next step.
  • For tech industry expert, Jason Alan Snyder, smartwatches are about functionality and features.  They are about advancing technology to make our lives easier. The debate shouldn’t be about smartwatches vs timepieces, they should be about smartwatches and all the major advancements going on in technology.

As Randy Brandoff moderated the panel, addressing such issues as the future of the watch industry for collectors, what future technological functions make sense for wristwear and Swiss watch manufacturers pursuing their own smartwatches, panelists made predictions and gave insights that will make many watch, technology and luxury industry people “wait and see” over the next few months as smartwatches set the stage for the evolution of how people tell time.

Click the link to watch the video of the roundtable for quotes by Milton Pedraza, CEO of Luxury Institute: The Watch Collectors’ Roundtable – Will Smart Watches Disrupt the Swiss Watch Industry?

To learn more about the Roundtable at or contact The Lilian Raji Agency at or (646) 789-4427.

November 22, 2014

Astronaut Mark Kelly talks watches at South Coast Plaza

By: Lisa Liddane
OC Register
November 23, 2014

The former Space Shuttle and combat pilot lends his credibility to Breitling’s timepieces.

As ambassadors of luxury timepieces go, Mark Kelly is as antithetical to the prevailing celebrity mold as it gets. He travels without an entourage, can walk into South Coast Plaza and blend into the crowd – as he did recently, and does not pose in any advertisements for Breitling.

Perhaps that’s a good thing.

The retired astronaut and decorated Navy pilot brings to the 130-year old Swiss brand two important things that actors Daniel Craig, Hugh Jackman and Leonard DiCaprio, for all their onscreen talent, bankable pulchritude and high-wattage glamour, cannot provide to the watch brands they represent: gravitas, authenticity and credibility.

Kelly’s résumé includes flying 39 combat missions during Operation Desert Storm and traveling more than 22 million miles through space, according to the National Aeronautics and Space Administration.

“Mark Kelly has such a great reputation for integrity – he’s an all-American space hero,” said Milton Pedraza, chief executive officer of the Luxury Institute, a boutique research and consulting company. Breitling, which calls its timepieces “instruments for professionals,” has had a long-standing relationship with the aviation industry, Pedraza said. Kelly is the ideal brand representative who appeals to a specific segment of luxury watch customers who prize accuracy, innovative technical features or aviation-related components.

Kelly visited the South Coast Plaza Tourneau boutique, which has a dedicated Breitling wing, to launch the new Cockpit B50, a chronograph specially developed for pilots. He sat down with the Register to discuss his history with Breitling and how watches are practical instruments of measurement for him. Here are highlights from that conversation:

Orange County Register: I understand you were wearing a different watch brand during your first space flight.

Mark Kelly: I wore a different one, which shall remain nameless, a pretty high-end watch that didn’t work.

OCR: What happened?

MK: It had a little issue. The second hand got stuck on the minute hand (chuckles), which is not a good thing when you need the second hand to time something at an important part of the space flight … that was the only time I wore that watch.

OCR: Did you buy a new one?

MK: I got a Breitling from a friend of mine.

OCR: What did you know about Breitling at the time?

MK: I always wanted one. I knew it was a watch for aviation and was very reliable and probably wasn’t very well known as some of the other brands, but it’s a product that’s really made for pilots.

OCR: The accuracy of the watches seems to be a big selling point, and I would guess that for you, it is.


MK: Yeah, it is, especially in my career as an aviator … time was incredibly important. In the airplane that I flew, you needed to be able to constantly do the math in your head, but use the watch, your distance and your airspeed to figure out, are you behind or are you ahead of getting the target on time … you would break it down into six second increments. Why six seconds? Do you know why?

OCR: Why?

MK: Because it’s a tenth of a minute, it’s easier to do the math. The accuracy of the minute hand and the second hand is key to being able to do your route. And it’s sort of like that for space flight, too. You need an accurate watch because you’re doing a lot of critical things on time.

OCR: You’ve worn Breitling since about 2006. As a veteran, pilot and an astronaut, did you ever imagine you would be a face of a luxury watch company?

MK: No (laughs). When I had my first Breitling watch I had no relationship with the company. I just wore them. Before my last flight (into space), the Association of Naval Aviation contacted me to ask me to fly a Breitling watch that was going to be given to President Bush “41″. It was the centennial year of naval aviation, so I took that watch into space, took a bunch of pictures in space.

The plan wasn’t set on who to give it to. There was a thought about giving it to President Obama, the current president. People went, well, President Bush is a naval aviator. At the end of the day, they decided to auction it off and they gave the money to a school in Pensacola that uses Naval aviation to teach kids math and science. It went to a much better cause. The watch went for like, $60,000.

OCR: As for the new Cockpit B50, are there any features in it that you find interesting?

MK: If I was flying in combat again, that’s the watch I would buy. It’s a SuperQuartz movement, thermocompensated … it’s incredibly accurate. If you turn your wrist, the light will come on. So imagine you’re flying an airplane at night, you don’t have to take your hand off the throttle … it has a regular alarm that’s a tone, but also has one that vibrates like your phone so you can feel it. It’s nice to use in space where it’s so loud – all the fans, pumps and everything.

OCR: How many Breitling watches do you have now?

MK: Oh, I don’t know. I have several … most are locked up in a safe.

OCR: Which one is your favorite?

MK: The one I’m wearing – right now. … This is a Navitimer 1461. It’s got dates, days of the week, the month and it’s got the moon phase. It’s really kind of cool. It has to be reset only once every leap year (or every 1,461 days). So you really have to adjust it only every four years.



March 17, 2014

Wall Street Shares Wealth, for Better or Worse

By: Martha C. White
NBC News
March 15, 2014

The $26.7 billion in bonuses that Wall Street hauled in last year will help fill city and state tax coffers, and certainly boost retailers when bankers sport Patek Phillipe wristwatches and slip into Maseratis. But all that green is a double-edged sword for New York City.

Wall Street bonuses grew by 15 percent in 2013, to an average of $164,530, according to the New York State Comptroller’s office. Milton Pedraza, CEO of research firm the Luxury Institute, estimated that Wall Streeters spend between half and three-quarters of their bonuses, then save or invest the rest, and about half the amount they spend is funneled into the local economy.

Because they spend an incredible amount of money in their jobs, “I think that spills over in their personal life,” said David Friedman, president of research and consulting company Wealth-X.

Click the link to read the entire article:

May 20, 2013

Richemont’s Asia focus drives full-year sales up 14pc

By Erin Shea
Luxury Daily
May 17, 2013

Richemont is attributing its full-year sales increase to demand in China and Asia-Pacific, contributions from currencies and exchange rates and the broad growth from its brands across all regions.

Luxury conglomerate Richemont reported a 14 percent increase in annual sales to approximately $13 billion in 2012, compared to last year’s sales of $11.4 billion.

Richemont also reported that its profits for the year are up 30 percent to $2.6 billion from $2 billion in the previous year, much of which can be attributed to the sales in Asia-Pacific. The conglomerate released its results May 16 for the fiscal year that ended March 31.

“The Chinese and the Asians have a very healthy appetite for jewelry,” said Milton Pedraza, CEO of The Luxury Institute, New York.

“I think that ready-to-wear products may be oversaturated [in Asia], and handbags may be oversaturated, so watches and jewelry tend to be valuable,” he said.

“There are some companies in luxury that continue to grow, despite the global economy.”

Mr. Pedraza is not affiliated with Richemont, but agreed to comment as an industry expert.

Richemont, which was not able to comment directly, owns a number of luxury brands including Vacheron Constantin, Jaeger-LeCoultre, Baume & Mercier, A. Lange & Söhne, Cartier, IWC, Piaget, Alfred Dunhill, Van Cleef & Arpels, Montblanc, Chloé and Roger Dubuis.

Asian expansion
Richemont attributes its sales results to an increased demand in China and Asia-Pacific, contributions from currencies and exchange rates and the broad growth from its brands across all regions.

The company said that it works on a long-term basis of benefiting from the prestige and heritage of its brands, which will continue in the future.

However in the short-term, Richemont said that economic troubles may impact consumer confidence in some markets. Overall, the conglomerate is cautiously optimistic about the future.

During this past fiscal year, Richemont reported that Asia-Pacific accounted for the majority of its sales, with 41 percent of the group’s total sales coming from that area. Hong Kong and mainland China are its two largest markets.

Europe, including the Middle East and Africa, was responsible for 36 percent of Richemont’s overall sales.The conglomerate says this area’s growth was a result of demands from tourists.The Americas region had a third consecutive year of double-digit growth. This year, it accounted for 15 percent of group sales.Compared to other regions, Asia-Pacific is the area that is leading Richemont’s growth.

“Asia-Pacific is still a vibrant part of the world and there are some companies that are doing well there,” Mr. Pedraza said.

“Some brands are doing a fantastic job in that area,” he said. “Richemont is doing a fantastic job.”

Retail v. wholesale
Another aspect responsible for Richemont’s growth is its individual brands’ focus on retail over wholesale.

Cartier boutique

For the Asia Pacific and Europe, Richemont reports that its brand’s own boutiques had the highest growth rates.

In Asia, the brand boutiques had higher sales growth than the company’s wholesale partners. This is in part due to the expansion of the boutiques in the region.

“Richemont has set out over the last few years to try to keep its own distribution,” Mr. Pedraza said.

“Retail is outselling wholesale, which can help a company grow faster,” he said. “You can have faster growth when you are de-emphasizing wholesale and emphasizing retail.

“Most luxury brands want to control their own distribution. Watch brands tend to be more retail-oriented.”

January 15, 2013

Tiffany Deal Whispers Buoy Value After Earnings: Real M&A

By Tara Lachapelle and Cotten Timberlake
January 14, 2013

In the eye of the investor, Tiffany & Co. (TIF)’s blue-boxed gifts are so alluring to potential suitors that not even the worst earnings stretch in at least a decade has put a dent in its valuation.

Even though the $7.6 billion company has missed profit estimates in four straight quarters and said last week that analysts’ fiscal 2014 projections were too high, the jewelry seller fetches 18.6 times earnings, according to data compiled by Bloomberg. That’s only 0.4 point lower than the multiple in March, when the shortfalls started, as takeover speculation helps support the shares, Ariel Investments LLC said.

LVMH Moet Hennessy Louis Vuitton SA (MC), PPR SA and Cie. Financiere Richemont SA could all boost their earnings by adding the company to their current stable of luxury brands, according to ISI Group and the Luxury Institute. Ariel says a buyer would have leeway to expand Tiffany in the U.S., Asia and Europe. A purchase at current prices would be the biggest of a retailer since Coles Group Ltd. more than five years ago, data compiled by Bloomberg show.

“Sooner or later someone will make a run at Tiffany,” Howard Ward, the chief investment officer for growth equities at Gamco Investors Inc., wrote in an e-mail. Gamco, which oversees about $37 billion, owns shares of the company. “It is a trophy property,” he added. “There are some obvious foreign luxury brand companies that would be interested.”

Swatch Group AG today said it agreed to buy the Harry Winston watch and jewelry brand for about $1 billion, adding a luxury label in the Swiss watchmaker’s biggest acquisition ever. Shares of Tiffany advanced 1.6 percent to $61.25 today.

Takeover Speculation

Mark Aaron, a spokesman for New York-based Tiffany, said the company doesn’t comment on speculation, when asked about the retailer’s takeover prospects. Chairman and Chief Executive Officer Michael Kowalski said in a 2011 interview with the Financial Times that Tiffany has been the subject of deal speculation “probably since we went public in 1987.” He added that his shareholders would be “best served” by the company remaining independent.

Representatives of LVMH, PPR (PP) and Richemont declined to comment.

Tiffany shares plunged 4.5 percent, the biggest drop in six weeks, on Jan. 10 when the company said earnings for the fiscal year ending this month will be at the low end of its forecast after holiday sales growth slowed in the Americas and Asia. Tiffany also projected earnings in the fiscal year ending in January 2014 of about $3.39 to $3.49 a share, compared with the $3.80 average of analysts’ estimates, data compiled by Bloomberg show.

Not Suffering

The company had already missed analysts’ income forecasts for four straight quarters, the longest stretch in at least a decade, the data show. Still, Tiffany’s price-earnings ratio hasn’t suffered much, only falling to 18.6 from 19 on March 19, the last close before its first profit shortfall. The valuation has held up even as Tiffany’s market capitalization dropped from last year’s peak of $9.3 billion.

The Tiffany brand may be alluring to potential acquirers, according to Tim Fidler, a Chicago-based money manager at Ariel Investments, which oversees about $5 billion including the retailer’s shares. In the luxury jewelry industry, Tiffany has the best-known brand among affluent consumers surveyed by the Luxury Institute. Despite falling short of earnings projections since early last year, the company’s fiscal 2013 revenue is forecast to be $3.8 billion, up $1.1 billion from three years earlier, data compiled by Bloomberg show.

Tiffany’s Consistency

“There aren’t many companies in the public markets today on the retail side that you can argue have all the positive attributes with the consistency that Tiffany has demonstrated,” Fidler said in a phone interview. “A lot of the big, European houses would love to own a brand of this type.”

Tiffany said this month that it signed a 20-year agreement to keep selling jewelry by Elsa Peretti, which accounts for about 10 percent of its sales. The accord lets Tiffany retain exclusive rights to the designs, which include “Diamonds by the Yard” and iconic heart- and bean-shaped pendants.

By renewing the deal, Tiffany removed an impediment that could have deterred suitors from considering a purchase of the company, Omar Saad, a New York-based analyst at ISI, wrote in a Jan. 8 note. He said Tiffany “would be a highly attractive asset to the large luxury conglomerates,” and argued that LVMH, PPR and Richemont could all boost earnings by purchasing it. Milton Pedraza, the CEO of the Luxury Institute, a New York- based research and consulting firm, agreed that those three European companies could fuel growth with Tiffany.

High Ranking

“Tiffany continues to have a high brand ranking and prestige,” Pedraza said. “Is it an interesting acquisition opportunity for somebody? Yes, presuming they will do something better and more interesting with it.”

Francesco Trapani, head of Paris-based LVMH’s watch and jewelry unit, said in November that he expects more consolidation in the industry. While the world’s largest maker of luxury goods always has “a window open on M&A,” the company won’t pay “stupid prices,” Trapani said. LVMH bought Bulgari SpA, the Italian jewelry maker, in 2011, and it also sells products including Louis Vuitton bags and Dom Perignon champagne.

PPR of Paris is reorganizing to focus on luxury, sports and lifestyle brands as it seeks to lift sales to 24 billion euros ($32 billion) by 2020 from 12.2 billion euros in 2011. The owner of the Gucci brand has said acquisitions will account for about 20 percent of that goal.

Coles, Wesfarmers

Richemont, the second-biggest luxury goods company, owns brands including Cartier and Van Cleef & Arpels.

A deal for Tiffany at current prices would be the largest takeover in the retail industry since Wesfarmers Ltd. purchased Coles for $15.8 billion in 2007, according to data compiled by Bloomberg.

Because Tiffany’s management knows it’s running an “iconic” brand, it may command a takeover price higher than acquirers are willing to pay, said Brian Yarbrough, a St. Louis- based analyst for Edward Jones & Co. Tiffany shares would be trading above $90 if they were meeting their historical relationship to forecast profit, he said. The company, which ended last week at $60.28, may seek something similar in a sale, he said.

“For a public company, it’s going to be hard to pay that kind of a premium and have it not be dilutive,” Yarbrough said in a phone interview. “Management is going to be very hesitant to sell down here when the business is struggling and not firing on all cylinders. There are reasons why buyers could be interested, but it’s all going to come down to price.”

‘Very Few’

The most likely buyers are the global luxury conglomerates that would buy Tiffany for strategic reasons and that “can afford to pay the most,” said Oliver Chen, an analyst at Citigroup Inc. in New York.

Tiffany is “an extremely attractive asset as an American brand,” Chen said. “They are one of the very few,” he added. “There is an opportunity for incremental product innovation, and Tiffany has an extremely attractive global presence and global awareness.”

Ariel’s Fidler estimated that Tiffany’s value to a buyer is in the “high $70s to low $80s,” based on past acquisitions by strategic buyers in the industry, a discounted cash flow analysis and the current valuations of its peers.

“Obviously if someone is interested in the company, much like management, you always want to listen,” Fidler said. “There’s enormous value at this company and it’s not hard to get to a number substantially higher than the current stock price for a potential transaction.”


October 19, 2012

Survey: Watch, Jewelry Sellers Forge Best Relationships

By: Rob Bates
JCK Magazine

Stores that sell watches and jewelry forge stronger relationships with customers than retailers of other luxury goods, says a new survey of affluent consumers by the Luxury Institute.

The survey found that 49 percent of affluent consumers have strong relationships with their watch retailers—the highest level for any category—and that 40 percent have similar relationships with jewelry sellers. Men’s ready-to-wear was third, followed by handbags and women’s ready-to-wear.

As to how jewelry sellers established relationships with consumers, the largest number of respondents (37 percent) said the jewelers “made them feel comfortable.” Some 35 percent said the retailer “demonstrated they were an expert,” and 30 percent said “they were not too pushy or overbearing.”

These relationships pay off: Two-thirds of respondents who have relationships with specific sales professionals at jewelry brands say they purchase more as a result.

Milton Pedraza, CEO of the Luxury Institute, tells JCK that, as impressive as these numbers are, they should be higher, noting the importance of relationships to upper-income consumers.

“There is no reason that we shouldn’t cultivate a much higher level for relationship building,” he says. “In the luxury industry, they should be your jewelers for life.”

The survey queried U.S. consumers with at least $5 million in assets and $200,000 in annual income.

October 17, 2012

High-Income Shoppers Talk Openly About Luxury Salespeople; Relationships With Wealthy Customers Blossom When Staff Shows Knowledge, Professionalism and Courtesy

(NEW YORK) October 17, 2012 – Wealthy shoppers with minimum annual income of $150,000 rank attributes they find important among people selling them high-end goods and services in the new Experiences With Luxury Salespeople WealthSurvey from the independent and objective New York-based Luxury Institute.

The most important attribute is knowledge, cited by 72% of respondents. Being professional (68%), and polite and courteous (65%), are also of high importance, followed by being honest (57%), helpful (56%), trustworthy (52%) and experienced (52%).

Relationships with individual salespersons are common, with 40% of shoppers reporting a primary point of contact for at least one luxury provider. Relationships are most prevalent in personal finance (11%) and jewelry (10%). Perhaps surprisingly, individual relationships are just as common in fashion (8%), as they are in autos, travel and beauty.

Respondents provided ratings of specific brands in ten categories with exceptional levels of sales service. Some of the standout performers are Lexus, Mercedes and BMW in automobiles, Marriott, Hilton and Ritz-Carlton in hospitality, Coach in handbags, Nordstrom in fashion apparel and Rolex in watches. Categories in which the highest proportions of wealthy customers cite exceptional service are jewelry and watches (31%), leisure travel (24%), and fashion apparel (24%).

“A strong Customer Culture has a halo effect on companies,” says Luxury Institute CEO Milton Pedraza. “More than 75% of high-end shoppers recommend brands to family and friends based on outstanding experiences that they’ve had with a salesperson.”

Respondents reported average income of $310,000 and average net worth of $3.6 million.

About the 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.

October 11, 2012

Ultra-Wealthy Shoppers Spend More On Luxury Where They Maintain Personal Relationships; Pentamillionaires most likely to be close with specific sales professionals at Barneys, Bergdorf Goodman

(NEW YORK) October 11, 2012 – U.S. consumers with at least $5 million in assets and $200,000 in annual income share detailed opinions and observations about their relationships with salespeople in six luxury categories in the new 2012 Luxury Customer Relationship Index survey from the independent and objective New York-based Luxury Institute.

High-ticket categories show higher rates of customers who deal with a specific salesperson.  Watches (49%) lead all categories in terms of proportion of customers who maintain relationships with salespeople, followed by jewelry (40%) and men’s ready-to-wear (38%). There is a noticeable drop-off in rates of personal relationships at luxury retailers (30%), handbag brands (27%) and women’s ready-to-wear (21%).

Across categories, 70% of ultra-wealthy customers who transact and communicate with a specific salesperson say that this relationship causes them to spend more on goods and services in stores and on the Web. The biggest positive impact on sales comes when customers maintain relationships with salespeople in luxury retail, and in both men’s and women’s ready-to-wear categories.

In luxury retail, Bergdorf Goodman (51%) and Barneys (49%) enjoy the highest rates of maintaining relationships with ultra-wealthy customers, with larger chains like Bloomingdale’s and Nordstrom seeing lower incidence of relationships. In the middle are Brooks Brothers (36%), Neiman Marcus (32%), Lord & Taylor (30%), and Saks (26%).

“Luxury retailers know that relationships drive sales,” says Luxury Institute CEO Milton Pedraza. “The right hiring, education programs and Customer Culture help to promote more productive relationships and higher sales.”

About the 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.

September 8, 2012

Internet finance: How to kick-start your bright idea

By Claire Adler
Financial Times
September 7th, 2012

A watch brand has emerged as the king of crowdfunding, a trend that allows creative people to connect online with the public for cash to fund their business ideas.

In April, after numerous rejections from venture capitalists and rapidly running out of cash, five 20-something men from Silicon Valley turned to Kickstarter, a site that allows creative companies, including many filmmakers and musicians, to raise money from individuals online.

The site does not charge to set up a campaign. But, if it is successful, the site takes 5 per cent of the final amount. Amazon, which processes the payments, takes 3 to 5 per cent.

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

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