By Robert Frank, WSJ.com
The rage in the luxury world these days is “back to basics.” Wealthy consumers don’t want flash and sizzle, they want authenticity, low-key practicality and craftsmanship. Conspicuous consumption is dead, we hear. No one wants to be pay to be noticed anymore. They want stealth wealth and comfortable shoes. Or do they?
A new study from the Affluence Collaborative and Agency Sacks finds that wealthy consumers (those with $500,000 or more in income) are far more likely than others to want respect and attention from their purchases. When asked what needs are met by their favorite brand, nearly a third of the wealthy consumers agreed with the statement that “It allows me to feel a sense of accomplishment.”
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Fully 28% agreed that their favorite brands “allow them to stand out from the crowd” and 20% said the brands “command respect from others.” Of course, that is a minority of respondents. But what is surprising is how the responses of the wealthy differ from the lesser-wealthy.
The affluent, or those with $200,000 to $499,000 in income (in light of the latest tax debates, we also could call them the “Obama wealthy”), were far less likely to spend to stand out from the crowd or get respect. Only 8% of the affluent said they shopped to command respect from others, compared with the 20% for the wealthy.
Across the board, the wealthy needed their favorite brands to fill far more needs in their life compared to the affluent–from “providing me with a sense of adventure” to “making me feel reassured in a changing world.”
That is a tall order for a handbag or a watch.
Andrew Sacks, president of Agency Sacks, said the reason is that the wealthy have become consumer “separatists,” who want to be treated differently, need special products and special service, and crave very personal recognition.
Even though many of them grew up middle class and built their own fortunes, they have quickly developed a strong sense of entitlement. Mr. Sacks calls it “earned entitlement.”
“Just because they have middle class values and may not dress the part of wealth of old, their needs and demands are every bit as intense, and perhaps even more so as the value of the dollar is that much more important to them,” he said.
Why do you think the wealthy have so many emotional needs from the stuff they buy?