How To Buy Luxury 3: What Rich People Want

The December issue of Ledbury Research's High Net Worth newsletter (subscription only) quotes a Barclays Wealth study about what rich people look for when buying luxury goods. Product quality and value for money top the list, though quality is slightly less important -- mentioned by only 60 percent -- to the really, really rich (with assets over $3 million) than it was to the just a little rich (with assets less than $1 million), 78 percent of whom thought it mattered. What was at the bottom of the list? Country of origin. Only 7 percent of the very, very rich care and only 5 percent of the less rich care. This hammers home something I've long argued. Luxury consumers want things that are made well, of fine fabrics and careful construction. And if manufacturers can find workshops in China or India where that kind of work is still being done, so be it. Luxury consumers don't really care where it is made so long as it is made as it should be, and that (before people start shouting sweatshop) includes taking worker conditions into account. WGSN, subscription only, reports today that in order to keep prices of European goods reasonable in the US, some producers have been switching materials. "At Saks Fifth Avenue, there has recently been some price resistance among customers for some European apparel, according to Saks Inc chief executive Stephen I Sadove, who said Saks was working more closely with suppliers who are either changing fabrics, absorbing costs or raising prices." Sadly they don't say which brands are changing fabrics, but whoever you are keep in mind the short-term gain could well lead to a long-term devaluation of your brand. □