As brands and marketers pave the way for a new year, it’s always a powerful resource to tap the knowledge of industry veterans who can add perspective about the landscape. Today, we share perspective from Bob Shullman, Founder & CEO of the Shullman Research Center.
We have now made it through January and, all things considered, the first month of 2018 has gone very well based on what we have both heard and have seen regarding the luxury, affluent and wealth-related markets. The two organizations that track consumer confidence and sentiment (The Conference Board and The University of Michigan) both published glowing, month-end reports regarding consumer’s expectations for the coming months. Recently, I have been a panelist at a number of industry forums, including Luxury Daily’s Sixth Annual Luxury FirstLook 2018 and The Luxury Marketing Council’s Looking Forward to Luxury in 2018-Part Two. Both discussions unveiled great optimism in the marketplace. Not to our surprise, we also heard some concerns and pessimistic remarks about what may take place during 2018. Here’s what they had to say.
Big picture ̶ virtually everyone at the events were very optimistic about 2018. That said, there were some mixed emotions.
- “Based on 2017, things are going very well and should improve barring any global events causing otherwise”
- “Intense preparation”
- “I am an optimist, but also a realist and manage my expectations”
- “Confidence in my own abilities to manifest what I want”
- “Both luxury and local business are not recovered yet and the business is changing faster than we can keep up”
- “Political uncertainties”
- “General short term growth but long term-worry”
So, what keeps them up at night?
- “White House!”
- “Unexpected financial or world event”
- “New tax laws”
- “Clients spending money”
- “Attrition of customers. People investing in equities but not luxury goods or real estate”
- “Big Data interpretation and related strategies”
Moving into the year, we look forward to the remainder of 2018…and so should you as brands and marketers. Barring no catastrophic world events, the expectations of American consumers remain neutral. Value, worth and authentic experiences all play a major role in what brands must deliver and consumers expect.
Who to watch…and target?
It’s simple. Millennials.
The millennial market is worth $17 trillion in private wealth, a figure that will multiply by 1.4 by 2020. Also, millennials have massive spending power, with the global value coming in at $2.45 trillion, which will triple by 2025. Millennials’ spending power has resulted in true luxury aspiration. Currently, millennials are responsible for 20 percent of the luxury goods market. By 2025, millennial consumers’ spend will triple and the demographic will control 40 percent of the luxury goods market.