The News Prestige Network has released findings from Ipsos World Luxury Tracking, a landmark study that has for the first time been brought to Australia, providing both a global and domestic lens on affluent consumers.
Every year, Ipsos World Luxury Tracking highlights the different trends within a key geographic zone and allows brands to better understand consumer expectations and local cultures.
Running for over 10 years, the study is conducted in 13 countries, surveying 1,000 affluent people, aged 18-64 who are in the top 20% household income bracket in each country, which in Australia is in excess of $130,000 per year before tax.
Managing Director The Australian, NSW & Prestige Titles, Nicholas Gray said: “We partnered with Ipsos to bring this global study to Australia because of their established expertise and knowledge of the luxury sphere. In conjunction with Ipsos, the News Prestige Network has set out to explore the mindset and behaviours of affluent Australian consumers across a range of key categories.
“Most research conducted in Australia focuses on measuring the average Australian or middle Australia, certainly with no global comparison either. News Prestige Network delivers a premium audience at scale, reaching more than five million Australians every month. Understanding our consumers has never been more critical and having exclusive access to specific research involving an elite local and global audience is an exciting opportunity to be able to present to our customers.”
When looking at some of the key luxury markets, the study identifies that each country has their own unique value system when it comes to their expectations from luxury brands.
Cultural values play a significant role in shaping consumers’ expectations from luxury brands. Different regions have different luxury needs and motivations.
Australian affluents are more likely to seek luxury for self-betterment. Compared to the global average, Australians over index on both social commitment from luxury brands as well as their focus on experiential aspects of luxury.
For affluent consumers in Europe and the UK, luxury is almost ubiquitous and ingrained into their culture and they desire to be courted and romanced by luxury brands – placing greater emphasis on escapism, rarity and exceptional service.
For affluent Americans, they expect to be engaged and immersed in the luxury brand story – being more likely to seek a sense of ‘belonging to an inner circle or club’ from luxury brands, as well as an experiential focus which is similar to Australia.
Affluents in the Asian market are more likely to seek validation through luxury. They are seeking status and confidence from luxury brands and also value the history, tradition and heritage.
These cultural differences are further seen in the product category that best represents luxury.
• For Australians, in the pursuit of betterment, travel is synonymous with luxury.
• For Europe and the UK, jewellery, cars and watches best symbolises luxury to them.
• For Americans, when they think of luxury, they think of high-end cars such as Tesla. They also yearn for the luxe experiential moments achieved through travel.
• For affluents in the Asian market they are seeking social validation through visual status, 53% consider jewellery as the best representation of luxury.
Ipsos ANZ managing director Liz Harley said: “The study has identified that Australia is a unique and highly nuanced luxury market comparative to other countries. Its proximity to emerging markets has made Australia a desirable travel destination for luxury experiences for visitors, furthermore, Australia’s social foundations are steeped in the Western and more mature, luxury markets, where Australians tend to follow their social and design cues.”
Luxury is seen as an investment, both emotionally and financially. In a climate of considered spending where home ownership is becoming increasingly unattainable for younger generations, the ROI expectations on luxury goods is high. 81% of affluent Australians expect their luxury purchases to represent a long term investment, this is higher than the global average of 76%.
Luxury purchases are well researched and are becoming less impulse driven. Luxury purchases are well researched before the point of sale, with affluent Australians less likely to make a luxury purchases on impulse. Nine in 10 luxury buyers in Australia will actively search for information before making a luxury purchase, consulting an average of 3.5 different media sources.
Experience is an integral part of luxury. The tactile nature of luxury means affluent consumers still prefer bricks and mortar stores over online in making their luxury purchases. Two in three affluent Australians prefer to make their luxury purchases in-store, to see, touch and feel the luxury item. One in three prefer online channels for its functional role, with 48% of respondents using online to access a better product range or a better price. Today, in-store experiences have evolved to deliver immersive hyper experiences for consumers and technology has played a key role in personalising the online retail experience.
Privacy protection is critical. Affluent consumers are opting for greater privacy and protection measures from luxury brands. Post GDPR, data security and anonymity is an expectation. Protecting their personal information and privacy is the number one factor considered very important by Australian affluents (43%) consistent with the global average.
News Prestige Network is presenting the Ipsos World Luxury Tracking to market via intimate briefings. To learn more about the study or for a category deep dive in travel, fashion, beauty, and more, clients can contact their News Corp Australia account manager.