Luxury Linens Customers Prefer to Shop Online
With so many brands on offer, selling luxury linens is a challenging game, even more so now that internet-only brands are emerging intended on disrupting the traditional business of high-end bed linens, online brands like Parachute and Boll & Branch.
In any given quarter, about 15 percent of affluent consumers purchase high-end luxury linens and soft goods, propelling this to be one of the highest-demand luxury home goods categories in Unity Marketing’s Affluent Consumer Tracking Study. And demand for luxury linens is even higher for ultra-affluents, those heavy lifters in the consumer economy who earn in excess of $250,000 per year.
Obviously, linen brands want to target this group of ultra-affluent consumers. Not only do they purchase luxury linens at a higher rate than do HENRYs (with income $100K-$250K), but they also spend nearly twice as much per quarter.
But it’s clear that even the best-known and respected luxury linens brands are at risk, when upstarts like Parachute and Boll & Branch offer the same quality features at significantly lower cost.
Ralph Lauren Home Is the Number One Luxe Linen Brand, but Vulnerable
Take Ralph Lauren Home, for example. Even with the Ralph Lauren name recognition and reputation, only 7 percent of ultra-affluent consumers included in the most recent ACTS survey purchased Ralph Lauren Home brand luxury linens. And the other luxe brands in our study didn’t even do that well.
The latest ACTS survey reveals an opportunity for luxury linens marketers and retailers to take advantage of the buying power of the ultra-affluent market, but brands must give them what they want, where they want it, and at the price they are willing to pay. Our research reveals that bed linens, like sheets and pillowcases, are the most popular purchases in this category and that ultra-affluents prefer to shop in this category online, as compared with HENRYs that favor department stores for their linens purchases.
That puts internet-powered brands like Parachute and Boll & Branch in position to capture the ultras’ outsized spending power. This calls on the established luxury brands to beef up their e-commerce efforts to compete for these economic heavy lifters. But first, brands have to understand consumer behavior. Unity Marketing’s research can give brands the intelligence needed to be more successful.
Marketing success starts with understanding the affluent customers
Let Unity Marketing be your research partner
Helping brands understand and act upon independent, reliable and valid research data is our goal here at Unity Marketing. Unity Marketing’s Affluent Consumer Tracking Study which regularly measures what brands affluents are buying, what luxuries they are purchasing and how they feel about their wealth and finances is an essential tool for marketers that aim for the affluent consumer segment with discretion to spend on luxuries and high-end goods and services.
Success in the luxury market begins with understanding the needs and desires of customers who can afford the luxuries for sale. Stop focusing on the aspirational customers and pay strict attention to those affluents with money to spend and a willingness to indulge. By subscribing to the ACTS research you can track trends in:
- Brands: The brands luxury consumers are purchasing, and the key segments consumer segments that are driving purchases, including HENRYs (high earners not rich yet), ultra-affluents, HNW, men, women, young affluents and mature affluents, white or ethnic. While Ralph Lauren Home tops the brand list in luxury linens, it’s clear that there’s plenty of room for improvement – or for a new ‘top dog’ to emerge.
- Shopping: Where they shop for their favorite luxuries and which channels are trending and which falling out of favor. In the luxury linens market, department stores are the most popular retail outlet with HENRYs, but ultra-affluents prefer to shop online.
- Demand & Spending: Trends in demand and spending, two totally independent variables. In the luxury linens market, demand is increasing, while average spending is declining, indicating that consumers are becoming more price sensitive and so waiting for good deals on these items that are both necessities and luxuries. Or they are choosing less premium-priced brands, like Parachute or Boll & Branch, but which promise all the same features, quality and comfort of the luxury-priced brands.
- Consumer Confidence/LCI: Affluent consumer confidence and attitudes about their finances and wealth, which is highly predictive of how they will spend their money in the coming quarter. For example, the most recent ACTS study found that affluent consumer confidence rose in January 2015, but spending took a sharp fall. In the current economic environment, the ‘wealth effect’ is going in reverse. Positive changes in affluents’ perceived wealth is only making them hold tighter to their gains, rather than spend freely on goods and services. This reverse ‘wealth effect’ trend positions luxury-quality, but lower-priced brands like Parachute and Boll & Branch in the sweet spot for capturing the affluents’ business this year.
To capture the loyalty of the affluent consumer, you need to know exactly where your brand stands and what brands, price points and shopping habits are impacting your business. Is your brand being as strategic as it can be in today’s consumer marketplace?
Call Pam @ 717-336-1600 or email firstname.lastname@example.org if you’d like to get a list of the brands currently listed in the ACTS survey and to learn how to put the powerful consumer insights to work for your premium or luxury brand.