Luxury Institute News

January 10, 2013

Audi, Lexus And BMW Triumph As Leading High-End Auto Brands By Wealthy U.S. Drivers

(NEW YORK) – U.S. luxury automobile consumers rank Audi highest in the 2013 Luxury Consumer Experience (LCEI) survey conducted by the independent and objective New York-based Luxury Institute.  LCEI scores (1-10) are averages of wealthy respondents’ ratings across ten areas of consideration, including evaluations of the vehicles they own or lease, their dealership experience, and their overall brand buying and ownership experience.

In addition to earning the highest LCEI score (8.36) of the ten brands surveyed, Audi ranks first for the consistently superior design and quality materials of its cars.  In addition, Audi’s dealership staff is recognized for being the most trustworthy and knowledgeable.  Audi also leads other carmakers in terms of future repeat purchase intent, with 96% of respondents saying they would consider buying or leasing an Audi again based on their experience with the brand.

Lexus ranks closely behind Audi with an overall score of 8.34, based largely on the dealership experience and its positive representation of the brand.  The Japanese automaker earns top honors for superior sales and service experiences, respectful dealership personnel, and long term relationship building.  BMW (8.27) and Mercedes-Benz (8.06) rank third and fourth, respectively.

“Wealthy consumers’ perceptions of brand experience encompass everything from the physical quality of the car to interactions with the sales and service departments at dealerships,” says Luxury Institute CEO Milton Pedraza. “Especially at the high-end, luxury automakers must be aware of how people and products combine to affect a brand’s reputation.”

Survey participants reported $2.4 million average net worth and $283,000 average income.

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.

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 (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.

September 14, 2012

In China, Bikes Shed Their Working-Class Roots

By Debra Bruno
Wall Street Journal
September 13th, 2012

BEIJING — Yu Yiqun sees the bicycle as the ideal form of transformation — and not because he can’t afford a car.

In fact, the 40-year-old, who works as a creative director at Geogrum Advertising, owns 21 bikes, including high-end brands like Moulton, Cervélo and Colnago. “You need different kinds of bicycles to ride in different kinds of environments,” he says.

Mr. Yu has spent as much as 110,000 yuan (more than $17,000) on a bike and considers their versatility an advantage over cars. “People in Beijing should update their ideas,” he says.

Click the link to read the entire article including quotes from Luxury Institute’s CEO Milton Pedraza:
http://blogs.wsj.com/scene/2012/09/13/in-china-luxury-cycles-help-bikes-shed-their-working-class-roots/

June 26, 2012

Social Responsibility Is Nice But Not Worth Paying for in Today’s Economy, According to Wealthy Consumers Surveyed by Luxury Institute

(NEW YORK) June 26, 2012 — In a new survey by the independent and objective New York-based Luxury Institute, “Corporate Social Responsibility: The Wealthy Consumer’s Viewpoint,” U.S. consumers earning at least $150,000 per year define socially responsible corporate behavior, rate companies and divulge importance of socially responsible practices in shaping purchase decisions. Responses were compared to those from the same survey in 2007.

Most (82%) wealthy Americans define social responsibility by a company behaving ethically with employees, customers and suppliers. Environmental behavior and philanthropic actions are both named by respondents as an essential component of CSR (58%).

Almost half (45%) of wealthy consumers say they seek out brands with high ethical standards, but only 39% of these shoppers would be willing to pay a premium. That’s down from 56% who would pay a premium in 2007. Apple, BMW, Coach, Lexus, Mercedes-Benz, Nordstrom, Starbucks and Whole Foods are frequently cited as highly ethical standouts.

Twenty-seven percent of wealthy consumers learn about companies’ socially responsible behavior via Facebook or Twitter. That’s up from 8% who received their information from social media in 2007. Reading news articles is the most popular (52%) way to learn of CSR efforts, down from 64% five years ago.

“Even wealthy consumers have de-emphasized social responsibility as this economy focuses everyone on price/value and away from social issues,” says Luxury Institute CEO Milton Pedraza. “Nevertheless, we see that luxury and premium brands that are socially responsible do better even during recessions because doing well by doing good is a universal and timeless concept.”

Respondents reported average income of $307,000 and average net worth of $3.1 million.

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.

September 13, 2011

Supercar mania drives on among the wealthy


Mountains of economic uncertainty around the world would hardly seem to create the frothy time for automakers to roll out new, mega-expensive sports cars.

By Chris Woodyard
USA Today
September 12, 2011

Yet the automotive world finds itself awash in the kind of extreme two-seaters that are so quick, light and expensive that they are called supercars. More than a dozen choices, some costing upwards of $2 million, are here and more are on the way to cater to the fickle rich elite who seem largely immune to economic downturns…

Click the link to read the entire article which includes a quote from Milton Pedraza, CEO of Luxury Institute: http://www.usatoday.com/money/autos/story/2011-09-12/super-cars/50375454/1

June 8, 2011

Wealthy Millennials Define Luxury Brands In 16 Categories; Craftsmanship And Quality Still Count, But Loyalty Programs, Special Offers And Personalized Service Rise In Importance; Is Apple The New Dom Pérignon?

(NEW YORK) June 8, 2011 – High net-worth consumers 35 years of age and younger define luxury brands much more in terms of loyalty programs and unique offers than do their older wealthy cohorts, according to Luxury Brand Marketing to Wealthy Millennials,” a new survey by the independent and objective New York City-based Luxury Institute.  “Generation Y” individuals born in 1975 and later are also much more likely to have made a luxury purchase in the past year than 35+ wealthy consumers (83% vs. 66%).

Apple, cited without prompting by 45% of wealthy millennials as a luxury brand, tops all other brands, followed by Rolex, Coach and BMW, each offered by 30% of respondents as examples of luxury brands. Just 5.2% cited the iconic Dom Pérignon as a top-of-mind luxury brand, compared to 12% for those older than 35.  In spirits, the most popular brand is the relatively young Grey Goose vodka.

“Wealthy millennials view luxury much more for the experiential factors associated with it, rather than relying on brand heritage or residual prestige earned long ago,” says Milton Pedraza, CEO of the Luxury Institute. “The good news for luxury firms is that these tech savvy shoppers want to interact with them, not only in stores but also online and on mobile devices.  This builds richer experiences and deeper relationships.”

For greater details on brand perceptions, awareness and what matters most to wealthy millennials in each of 16 luxury categories, please contact Martin Swanson, VP of Luxury Institute.

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.

For Further Information, Please Contact:
The Luxury Institute, LLC
Martin Swanson
Vice President
(914) 909-6350
mswanson@luxuryinstitute.com

May 10, 2011

High Net-Worth Consumers Pick Luxury Leaders And Laggards; Wealthy Shoppers Rank Watches, Jewelry And Ultra-Luxury Autos In Luxury Institute WealthSurvey

(NEW YORK) May 10, 2011 – The independent and objective New York City-based Luxury Institute today releases the 2011 Luxury Brand Status Index (LBSI) survey of wealthy U.S. consumers, offering firsthand perspectives in three rapidly growing luxury categories: watches, jewelry and automobiles selling for $100,000 and up.

Consumers earning at least $200,000 a year rated each brand on quality, exclusivity, social status and overall ownership experience. They also rated brands’ price worthiness, their willingness to recommend it and the likelihood they’ll buy it next time they make a purchase in the category.

Here are the top brands in each category based on composite LBSI score (1-10):

  • Watches
    • Blancpain 8.35
    • Rolex 8.01
    • Vacheron Constantin 7.85
  • Jewelry
    • Graff 8.38
    • Buccellati 8.19
    • Asprey 8.05
  • Ultra-Luxury Autos
    • Maybach 8.44
    • Bentley 8.32
    • Bugatti Veyron 8.22

“Overall LBSI scores yield accurate measures of brand prestige but actual buying behavior and recommendations of wealthy consumers tend to favor brands that are more practical, even if less exclusive,” says Milton Pedraza, CEO of the Luxury Institute, “For example, BMW and Mercedes are the two most frequently owned auto brands and those most likely to be recommended to family and friends, but the $2.6 million Bugatti Veyron has far more exclusivity.”

More details from the proprietary Luxury Brand Status Index (LBSI) survey, broken down by respondents’ age, gender income and wealth, are available to journalists and upon request.

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.

For Further Information, Please Contact:
The Luxury Institute, LLC
Martin Swanson
Vice President
(914) 909-6350
mswanson@luxuryinstitute.com