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A lack of customer-centricity mimicking the customer service of elegant boutiques keeps wealthy consumers from buying more online, says a Luxury Institute survey.
Wealthy consumers research and buy online-with 69% in a recent survey, for example, preferring to make hotel and resort reservations directly on the Internet. “The only remaining obstacle preventing wealthy consumers from purchasing a multitude of luxury products online appears to be the lack of customer-centricity on the part of some luxury firms,” says Milton Pedraza, CEO of survey and research firm The Luxury Institute.
The Luxury Institute surveyed 1,000 consumers with average household income of $288,000 and average net worth of $2.5 million. It determined that 96% of them buy products and services online, with 55% doing so frequently; and 99% of wealthy consumers use the Internet to research before they buy. According to the survey findings, more than half of the wealthy consumers surveyed prefer to make purchases of women’s apparel online while 43% prefer to use the web when buying men`s apparel.
Attracting wealthy consumers to a site is in large measure a function of effective search engine strategies, according to survey findings. 73% of those surveyed said finding a company through Internet search was an effective way to create a positive impression for a site. The second most effective way was finding ads in offline media, with 10% of the wealthy consumers surveyed saying this was an effective method, and 43% saying it’s somewhat effective.
Once wealthy consumers arrive at a web site, privacy and security were the top concerns in deciding to buy, closely followed by ease of navigation, according to the study report. Useful content, a liberal return policy and the ability to track shipments online also were cited by wealthy consumers as effective in getting them to purchase from a site.
“Companies should refrain from using pop-up or banner ads on-site as they are a turnoff for the wealthy, especially at the highest levels of income and net worth,” according to the survey findings. Surprisingly, survey respondents rated having a physical location as not key in their decision to buy from a retailer online. On a scale of one to 10, survey respondents gave having a physical location only a 4.8 in importance.