Hermès, Louis Vuitton attract US consumers

26 March 2010

NEW YORK: Hermès, Ferragamo and Louis Vuitton are among the most popular premium brands for wealthy US consumers, according to a study by the Luxury Institute.

The consultancy surveyed 1,265 people in the country with an average household income of $287,000 (€215k; £192k) and a typical net worth of $3.8 million.

Of the offerings assessed in the women's fashion category, Roberto Cavalli came out on top, with an index score of 7.89 points, ahead of Hermès on 7.81 points, and Balenciaga on 7.80 points.

Christian Louboutin headed the women's shoes category on 8.54 points, followed by Manolo Blahnik on 8.18 points, and Zac Posen on 8.15 points.

Among male respondents, Ermenegildo Zegna was the most favoured fashion label on 7.50 points, with Bironi in second on 7.44 points, and John Varvatos in third on 7.29 points.

Ferragamo took the honours for men's shoes, on a rating of 7.69 points, a total that reached 7.46 points for Hermès and 7.30 points for Louis Vuitton.

"Brands that might not be expected to be top-rated by the fashion experts have [often] made the top three," Milton Pedraza, the chief executive of the Luxury Institute, argued.

"While unexpected, we see consumers as the ultimate experts on brand prestige and this year they are voting on the entire perceived price/value equation of the brand as well as prestige."

Separately, the Luxury Customer Relationship Management Association – formed by the Luxury Institute in partnership with Ritz Carlton – polled 100 senior industry executives around the world.

It found that CRM would be a major priority for almost all companies in the sector this year.

In the wake of the global economic downturn, shoppers in many developed markets are keeping a close watch on their expenditure, heightening the importance of good customer service.

Overall, 90% of contributors stated that emphasizing CRM would help promote long-term growth.

For the two-thirds of participants that knew their current customer retention rate, this figure stood at just 57% at present.

Engaging with their target audience across a broad range of channels, and especially the web, was identified as being one key way that premium goods manufacturers could improve loyalty levels.

"Today it is essential for luxury brands to be customer-centric at every organizational level,” Felicity Lewis, senior global manager of interactive and direct marketing at Jurlique, the high-end skincare company, said.

"Delivering extraordinary customer experiences to drive sales is a must for every brand in 2010."

Data sourced from The Luxury Institute; additional content by Warc staff