Q. Why luxury eyewear?
A. It can increase your sales by 10% or more.
You have taken your surveys and received advice from friends, advisors and colleagues. You have hopefully written a mission statement and maybe started to put in writing the outline of an action plan (or maybe even started a more detailed plan). But we still have not answered one of the central questions asked and one of the central reasons I have started this blog – why is luxury product so important and why should it be included in your product mix and your overall retail strategy? Clearly this is an important topic – evidenced by James Spina’s recent and passionate 20/20 & U discussion.
So… today we will talk about WHY.
Today’s luxury market represents every marketers’ and retailers’ “sweet spot.” The top 25% of U.S. households (incomes of $75,000 and higher) have incomes two-and-one-half times larger than the nation’s average and they spend about two-times more than the average on most categories of consumer goods. In effect, the luxury consumer buys more of everything and they spend more every time they shop.
Light-bulb moment #1! These are the people you want to attract to your practice/retail establishment.
Bill Curtis, publisher of the Robb Report, further defines the concept of luxury: Luxury is not a matter of what something costs. It’s a matter of the entire visceral and emotional experience attached to it. It is about being inspired by products and services.
Light-bulb moment #2! This is WHY you need luxury product. It enables you to tell a unique story and offer a unique point of view at retail. In today’s retail world, experience rules and the consumer is in charge. Luxury product is the means by which you can tell your story and offer that unique experience.
It is important to back this up with actual numbers and facts. Here are two VITAL statistics proving WHY you need to offer luxury product as part of your overall strategy:
- Richard Baker of the Luxury Marketing Council states: the Luxury sector represents over $160 billion in retail sales and is growing in excess of 10% per year, DOUBLE the rest of the industry.
- According to fashion research firm NPD, Luxury Eyewear sales have been growing at about 10% per year on average for the past few years… far surpassing the overall eyewear market. And growing at a time when other price points and other accessories are seeing sales declines.
Light-bulb moment #3! What do the above definitions and statistics tell us? Luxury is where the affluent consumers are and affluent consumers still want luxury and still spend money – despite what we read in the paper and see on the news. If you are not catering to affluent consumers and trying to trade up your existing customer/patient base (affluent or not), you are missing an easy opportunity for sales growth.
Here are 7 key reasons luxury product should be part of your overall retail strategy:
- Luxury sales are growing at a faster pace than other price point categories.
- Luxury attracts affluent consumers – they are more loyal, they are wealthy, they are networked, and thus they tell friends about you if they like you.
- Luxury usually means local and NOT chain stores. Americans like to shop. They like to spend money (despite the current crisis). And they like to do it locally and not in chains. They want something special and they want it locally. Don’t give the business away to a chain.
- Luxury means generally higher margins on all sales.
- Luxury means higher retail price points which means greater sales volume.
- Luxury means higher sales per patient visit/transaction –All of this means you can increase your sales without even increasing your patient base or the number of people coming through your door. You can increase sales without increasing any marketing or outreach expenses (we will discuss this in more detail in a future post).
- Luxury product is the best way to stand out from the competition. It’s the best way to stand out from the chain stores that all look the same. And it’s the best way to fight the ever-present internet and all the discounts you can find there. In short, luxury product is the means to creating your own point of view at retail.
I hope you are finding these posts insightful and helpful. In the coming weeks we will explore the nuts and bolts of employing a luxury strategy. Stay tuned.
Last but not least – check out the Culture Corner for some new additions!