Googling Luxury

Posted on | July 17, 2008 |

Luxury Institute Survey Finds Wealthy Americans Flocking to The Web for Luxury Shopping, Search Engines are a Popular First Stop

by Milton Pedraza

Advice from friends or family carries considerable weight in shaping spending decisions, but many wealthy consumers are turning to the Web for much of their education on potential high-end purchases, findings which we have published in our latest Luxury Institute Survey of Americans with annual incomes of at least $150,000 on the key factors driving buying decisions in seven categories of luxury goods and services.

Nearly two-thirds of the wealthy (64 percent) go directly to websites of known providers for information on luxury goods and services; slightly more than the 57 percent who say that they solicit input from friends and family. Survey households had average annual income of $287,000 and average net-worth of $2.9 million.

Search engines, in particular, rank just behind company websites and advice from friends and family as the best sources of information when researching luxury purchases. Ratings and review sites attract the eyeballs of 38 percent of wealthy consumers.

At this stage, most luxury players are quickly awakening to the power of gateways like Google to drive customers to their sites. But now is the time to get processes in place to measure the efficacy of various search optimization strategies and other traffic and sales driving tools.

Google -recently earning top ranking in the Luxury Institute’s 2008. Luxury Brand Status Index survey for the search engine category, comfortably ahead of Yahoo! and Microsoft’s MSN- has carved out a dominant position within the luxury niche. Google was named specifically as a favorite ‘first-stop’ website for gathering information on luxury goods and services by 13 percent of wealthy consumers. The closest, but still distant, competition comes from Consumer Reports, a favorite of three percent of respondents.

Some items are still an easier sell in person. Nearly three of four wealthy shoppers (73 percent) say that they are only comfortable closing automobile transactions at a showroom, while 61 percent would only buy real estate or luxury jewelry in person. More than one-third insist on choosing fashion apparel (38 percent) and wealth advisors (35 percent) in person.

These highly tactile, big-ticket luxury items are generally better experienced rather than simply presented on a website.
Asked for a dollar threshold up to which they alms spending more than $10,000 on a single Web purchase. The average comfort threshold for online purchases by wealthy consumers is $3,294.

This latest WealthSurvey, along with 10 new surveys annually, a database of dozens of consumer surveys, the Wealth Report newsletter, plus networking with trusted qualified peers, are available to members of the Luxury Board, an online community for Luxury Professionals who wish to learn how to best serve luxury consumers, for $995.00 per year.

Contact us at Luxury Institute for details on all purchase drivers and their relative importance to the wealthy in all seven luxury categori.