Luxury brands should focus on older consumer

In an era of volatile economies, rising interest rates and slowdown in consumer spending, luxury goods companies seem to remain largely unaffected. The simple reason being that affluent consumers continue to spend. Whereas the average citizen may find a tight squeeze on outgoings when the mortgage goes up, the wealthy consumer will shop as before. Luxury goods are said to have high income elasticity of demand: as people become more wealthy, they will buy more and more of the luxury good.

Even value retailers such as Argos are targeting the more affluent
shopper, having introduced a range of goods that will appeal more to the middle-class shopper who has greater expenditure and would typically shop in John Lewis than BHS.

This is a sensible strategy, according to The Retail Bulletin, and one that could work equally well for other retailers as attracting senior shoppers are less effected by changing economies and rising rates. Older shoppers have been a forgotten demographic for retailers over the years but in tougher times this could change – especially with the number of older people predicted to grow rapidly around the world.

According to the IGD the number of over 65-year-olds will grow by 153 per cent in the UK between now and 2050 and will have serious spending power.
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