Luxury Institute News

January 7, 2013

Audi Rated Top Luxury Automotive Brand in 2013 Luxury Customer Experience Index

Posted in Automobiles,LCEI,Luxury Brands,Press Releases,Wealthy Consumer
Tags: Audi, Audi AG, Jeri Ward —

Brad Stertz
Audi of America Communications
January 4, 2013

HERNDON, Va. – Audi today announced that it received the top overall ranking in the 2013 Luxury Customer Experience Index (LCEI), conducted by the independent and objective Luxury Institute. The LCEI is based on data collected from affluent customers who were asked to evaluate 10 different aspects of ownership and customer experience of the luxury automotive brands they have recently used on a 0-10 scale. Among the 10 brands evaluated, Audi received the highest overall score of 8.36, recognized by customers for its consistently superior design and quality materials, and trustworthiness and knowledge of dealership staff.

“We are very pleased to have been ranked first overall in The Luxury Customer Experience Index, and we are delighted to hear that nearly all Audi customers surveyed said they would recommend Audi to others and would purchase or lease an Audi again,” said Jeri Ward, Audi of America Director of Customer Experience. “Audi and our dealer partners are continuously striving to delight our current and future Audi owners through customer experiences that exceed their expectations, and the results of the Index prove we are making significant gains.”

In 2011, Audi created the Customer Experience Team, a new division within the U.S. organization, led by Jeri Ward, which focuses on strategy and programs for improving customer experience and loyalty across the company.

The LCEI is based on a nationwide in-depth survey of 1,234 luxury automobile owners, conducted in November 2012. Respondents – ages 21 and older and with a minimum gross annual income of $150,000 – evaluated levels of respect, knowledge and trust of dealership staff, dealership sales experience and service experience after purchase, among other factors.

ABOUT AUDI
Audi of America, Inc. and its U.S. dealers offer a full line of German-engineered luxury vehicles. AUDI AG is among the most successful luxury automotive brands globally. Audi was a top-performing luxury brand in Europe during 2011, and broke all-time company sales records in the U.S. Through 2016, AUDI AG will invest about $17 billion on new products and technologies. Visit www.audiusa.com or www.audiusanews.com for more information regarding Audi vehicle and business issues.

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

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December 10, 2012

Superior Craftsmanship, Materials and Customer Service Define Luxury Market and Drive Premium Pricing According To New Survey

Posted in Automobiles,Customer Experience,Customer Service/CRM,Luxury Brands,Luxury Leaders,Press Releases,Wealthy Consumer
Tags: Jim Farley, Lincoln, Milton Pedraza —

(NEW YORK) December 10, 2012 – In a new survey by independent New York-based Luxury Institute, superior craftsmanship, materials and customer service scored highest in terms of helping to define the luxury market while driving premium pricing. Additionally, survey respondents overwhelmingly favored a long-lasting, high quality product over one that merely enhanced status.

The survey, in cooperation with the newly relaunched Lincoln Motor Company, asked wealthy luxury automobile consumers to share their opinions that may have altered since the recession about buying considerations and luxury spending across a variety of product categories.

“High standards for the tangible quality of goods are to be expected from such refined buyers,” said Luxury Institute CEO Milton Pedraza. “Of particular interest is the growing leadership of U.S. firms as global luxury brand icons. Jewelry from Tiffany & Co., consumer electronics from Apple and handbags from Coach are among the world’s most prominent brands, giving consumers worldwide more reasons to pursue luxury in the States.”

Defining and Driving the Luxury Market

When it comes to what drives luxury and justifies premium pricing, 86% of affluent Americans surveyed say that superior craftsmanship is the deciding quality. Nearly as many (84%) say they also expect the use of superior materials in luxury products. The third most important consideration, cited by 76% of wealthy respondents, is a “superior customer experience both during and after the sale.”

A majority of wealthy consumers report enjoying their luxury purchases discreetly versus proudly showing their purchases to others. In addition, more than 90% indicate that acquiring a long-lasting, high quality product is more important than enhancing their status.

“What we see in this insightful Luxury Institute research is that during the recession, the U.S. luxury market changed and people changed,” said Jim Farley, Executive Vice President of Ford Motor Company Global Marketing, Sales and Service and Lincoln. “They want what appeals most to their desires and not what they believe will impress others and this is a trend we believe will continue to grow ever stronger. We also took good note that in the automotive sector the expectation of great service is still being underserved, something we intend to address with the new Lincoln.”

Other survey results highlighted the fact that half of high-income shoppers rely on user reviews and the recommendations of family and close friends, enabling quick sharing of opinions and influence. These top-two influencers of luxury consumers’ purchase decisions demonstrate how relative newcomers can quickly establish brands that compete with established stalwarts, and how traditional brands can reinvigorate themselves via digital media.

Added Milton, “What we hear consistently and loudly from wealthy consumers is that the manner in which the goods are sold, as well as the service provided after the sale, are nearly as important as the products themselves. With American brands growing in luxury influence, there is a clear eagerness on the part of the global consumer to embrace American luxury brands, making service a critical success factor for the future.”

Survey Methodology
The Luxury Institute conducted an in-depth online survey with 1,216 affluent U.S. consumers in cooperation with the Lincoln Motor Company. Half male and half female respondents were recruited and screened to only include those age 21 or older with a minimum gross annual income of $150,000 and ownership/lease of at least one luxury automobile.

About the 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.

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December 7, 2012

Mobile is the essential medium for 2013: Digital Luxury Group exec

Posted in Luxury Brands,Luxury Leaders,Luxury Market,Wealthy Consumer
Tags: Digital Luxury Group, Milton Pedraza, Morpheus Media —

By Tricia Carr
Luxury Daily
December 6, 2012

A Digital Luxury Group executive who spoke during a Luxury Daily webinar said that luxury marketers that do not incorporate convenience and speed on the mobile medium into a seamless marketing approach will likely miss out on wealthy, transactional shoppers.

Executives from the Luxury Institute, Digital Luxury Group and Morpheus Media discussed their expectations for the next calendar year as well as potential surprises that marketers will face during the “Luxury Outlook 2013: Up, Down or Flat?” webinar Dec. 4. It seems that the light at the end of a tunnel littered with global economic uncertainties is mobile.

Click the link to read the entire article which includes quotes from Milton Pedraza, CEO of Luxury Institute:
http://www.luxurydaily.com/mobile-is-the-essential-channel-for-2013-digital-luxury-exec/

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December 6, 2012

Customer relationships, seamless media approach vital for 2013

Posted in Luxury Brands,Luxury Leaders,Luxury Market,Uncategorized,Wealthy Consumer
Tags: Apple, Digital Luxury Group, Milton Pedraza, Morpheus Media —

By Tricia Carr
Luxury Daily
December 5,2012

Executives from the Luxury Institute, Digital Luxury Group and Morpheus Media who spoke during a Luxury Daily webinar said that marketers should focus on relationship-building through technology and moving away from a fragmented media approach in 2013.

During the “Luxury Outlook 2013: Up, Down or Flat?” webinar Dec. 4, the senior executives agreed that consumer segmentation by geographic and demographic factors can help brands distinguish the “who” and “why” of luxury marketing next year. Overall, the executives concurred that the outlook on luxury for 2013 is “up.”

“It is simple – long-term relationships build sales and profits,” said Milton Pedraza, CEO of the Luxury Institute, New York.

“Instead of looking at what the competition is doing, do what Apple is doing,” he said. “It had the product, but it created an even greater value proposition for the brand.”

Click the link to read the entire article which includes additional quotes from Milton Pedraza, CEO of Luxury Institute:
http://www.luxurydaily.com/customer-relationships-seamless-media-approach-are-keys-to-luxury-marketing-in-2013-luxury-daily-webinar/

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November 29, 2012

Wealthy Shoppers Reveal Spending Plans, Attitudes On Global Luxury Industry

Posted in China,Europe,Japan,Luxury Brands,Luxury Market,Press Releases,WealthSurvey,Wealthy Consumer
Tags: France, Germany, Italy, Milton Pedraza, U.S., United Kingdom —

(NEW YORK) November 29, 2012 – Wealthy shoppers from seven global luxury markets share opinions and observations on issues confronting providers of high-end goods and services in the new 2012 State Of The Luxury Industry Global Trends survey from the independent and objective New York-based Luxury Institute. Respondents are among the top 10% of earners in the U.S., United Kingdom, France, Germany, Italy, China and Japan, with minimum income of $150,000 in the U.S.

Despite an economic slowdown and a crackdown on conspicuous consumption, 43% of wealthy Chinese consumers still plan to spend more on luxury products in the coming year. This varies dramatically from the 10% of Japanese and 9% of American consumers who say they’ll boost luxury spending, while in Germany and Italy, where only 5% of wealthy shoppers plan to spend more.

Indicative of strength in U.S. luxury retail, wealthy Americans plan to increase spending in all surveyed luxury categories compared to last year. Notable areas where recoveries are underway: ready-to-wear , jewelry, and private jet travel. Yachting also has the wind at its back, with 22% of U.S. consumers planning to spend more on luxury boating in 2012.

Everywhere except for Japan, discounting has enhanced luxury goods’ appeal and stimulated spending. Wealthy Chinese (59%) and Italian (53%) shoppers are most likely to say that discounting has improved their view of luxury and prompted greater expenditures.

“Product differentiation and exceptional service are what keep luxury relevant,” says Luxury Institute CEO Milton Pedraza. “Especially in an uncertain economy, firms need to give wealthy shoppers reasons to buy more.”

About the 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.

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November 8, 2012

Industry experts project affluent spending habits based on election results

Posted in Finance,Luxury Leaders,Luxury Market,Politics,Wealthy Consumer
Tags: Barack Obama, Congress, Democrats, Fiscal Cliff, Milton Pedraza, Mitt Romney, Presidential Election, Republicans —

By Mathew Evins
Evins Communications
November 7, 2012

Do you think that Barack Obama’s re-election will have a major effect on affluent consumers’ day-to-day spending? Long-term spending?

I do not think the re-election of Obama will have a direct effect on the affluent consumer’s day-to-day spending in the near term.

If it causes a major downturn in the stock market, this will have a slightly negative impact on the spending of the affluent, especially for holiday gifts.
As for the general public, they are not likely to change their spending because of his re-election. The larger influence on spending will be the actions taken, or not taken, to avoid the “fiscal cliff”, i.e. the increase in taxes and the major reductions in government spending due to take effect in January.

Click the link to read the entire article which includes quotes from Milton Pedraza, CEO of Luxury Institute:
http://evins.com/aperture/?p=499

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October 31, 2012

Ecommerce, deferred purchases to lessen Hurricane Sandy luxury retail freeze

Posted in E-Commerce,Hotel/Resort,Luxury Brands,Luxury Market,Retail,Wealthy Consumer
Tags: Hurricane Sandy, Milton Pedraza —

By Tricia Carr
Luxury Daily
October 30, 2012

The hurricane brewing in the Northeast region of the United States has brought luxury retail and travel to a halt, but retailers are not likely to suffer as consumers shift purchases to ecommerce or are willing to wait it out for the in-store experience.

While luxury brand hotels in the affected regions could remain closed this week due to Hurricane Sandy’s arrival and after-effects, retailers can potentially sustain revenue during the storm through online and mobile commerce. However, affluent consumers and visitors to New York will likely postpone planned store visits and purchases in favor of storm preparation and only return to the in-store shopping environment that they prefer when they can.

“In terms of net, I do not think there will be much impact,” said Steven Dennis, president of SageBerry Consulting LLC, Dallas, TX. “Certainly, the next few days will be hit very hard, but that is likely just to delay purchases rather than eliminate them.

“I think we will see a minor shift toward ecommerce,” he said. “Most purchases will just be deferred several days or more depending upon how long stores are closed, but there will be some complete losses from the tourist business.”

Click the link to read the entire article which includes quotes from Milton Pedraza, CEO of Luxury Institute:
http://www.luxurydaily.com/ecommerce-deferred-purchases-to-lessen-hurricane-sandy-luxury-retail-freeze/

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October 19, 2012

Survey: Watch, Jewelry Sellers Forge Best Relationships

Posted in Customer Experience,Handbags,Jewelry,Watches,Wealthy Consumer
Tags: Milton Pedraza —

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.

http://www.jckonline.com/2012/10/18/survey-watch-jewelry-sellers-forge-best-relationships

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October 17, 2012

Luxury Institute exec: Humanize first, mobilize second

Posted in Clienteling,Customer Experience,Mobile,Wealthy Consumer
Tags: Luxury Interactive, Milton Pedraza —

By: Rimma Kats
Luxury Daily
October 17, 2012

NEW YORK – A Luxury Institute executive at the Luxury Interactive 2012 conference said that brands must understand the value and potential of personal sales associate communications versus mass emails from corporate.

During the “Optimizing Mobile Technology to Build Customer Relationships” session, the executive addressed how mobile technology is not a differentiator, but a utility. Moreover, it is how marketers use the technology that matters.

“It’s all about the human-to-human relationships,” said Milton Pedraza, CEO of Luxury Institute, New York. “The biggest opportunity to use mobile to drive profits is customer relationship building.”

Click the link to read the entire article which includes quotes from Milton Pedraza, CEO of Luxury Institute: http://www.luxurydaily.com/luxury-institute-exec-humanize-first-mobilize-second/

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

Posted in Automobiles,Fashion,Finance,Handbags,Jewelry,Press Releases,Travel & Leisure,Watches,WealthSurvey,Wealthy Consumer
Tags: BMW, Hilton, Lexus, Marriott, Mercedes-Benz, Milton Pedraza, Ritz-Carlton —

(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.

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