If there’s one thing the recession has taught consumers, it’s to look for a bargain when shopping. Now that the recession is abating, consumers are buying more luxury goods. But, the rules of the marketing game have changed.
In the past few years, flash-sales websites satisfied the penny-pinching consumer’s need for luxury. And last year, several demographic groups upped their spending at these sites. The spending increases varied by age group but these double-digit growth rates show the popularity of these sites:
- Gen Y 31%
- Gen X 23%
- Seniors 28%
American Express Insights Data indicates that consumers are feeling better about the economy and may adjust their luxury buying tactics and shift somewhat from flash-sales sites to other online retailers. Edmond Jay, senior vice president at American Express Business Insights, notes that among younger consumers, Gen Y men are fueling the interest in luxury purchases and they spend “a higher proportion of their money” on these goods than women. And, Roseanne Morrison, fashion director at the Doneger Group points out the major change in shopping patterns since the start of the recession. She says, the “possession obsession” trend has turned instead to ‘surgical shopping’. The Gen Y group, in particular, is apt to buy one or two luxury items and pair them with less expensive pieces. As a result, the middle-market retailers are feeling the pinch.
Researchers have found that while older women tend to remain more brand loyal, younger shoppers are willing to experiment with different labels. This flexibility is an opportunity for retailers get creative as they aim to attract attention and increase sales. And perhaps, middle-market retailers will try to make the flash-sale trend work for their product lines.[Source: Little, Katie. Young and fashionable: Gen Y mixes luxury and cheap. Usatoday.com. 18 Feb. 2012. Web. 5 Mar. 2012]