Luxury marketing strategies for high-end art buyers and retention

Luxury Consumers in the Art Industry

Current Business Research Project

Define the business research and its purpose

How does one engage in a positive form of luxury marketing in today's increasingly uncertain economic climate, where luxury consumers seem to be growing increasingly scarce? To corner the luxury consumer, defined as a consumer who buy products not out of need but out of the perceived social amenities certain goods and services provide, may prove lucrative, and even necessary in such markets as the commercial art trade. Gregory Furman, the executive director of the Luxury Marketing Council in New York, said that the most successful luxury marketers concentrate their attention on the best customers, particularly those in the top fifth percentile of the indusry. He notes that forty to sixty percent of revenue in luxury goods invariable comes from the best return customers in the market. "The real meat comes from the top 10 to 15% of your customers, and whom one can be assured of a repeat business." (Tarateta, 2004)

By pleasing the luxury consumer says Furman, a luxury-oriented business can "create a buzz among a community of influence." In short, by acquring the top tier and the consumers of influence in the luxury market, lower-level luxury market customers are more willing to buy the good or service. (Tarateta, 2004)

Describe the method(s) used to conduct the research project

Both statistical and descriptive research was used over the course of this examination of luxury buying behavior. (Ryerson, 2005) Statistical research was used to determine the overall profile of the luxury market, such as the composition of the most loyal return customers. Research was also used to determine the advantage of soliciting certain luxury market segments for business owners in a quantitative fashion. However, descriptive and subjective data was also deployed to gather a more holistic profile of the customer in question. Also, individuals involved in the luxury industry were interviewed, and provided valuable anecdotal insight about their customer's buying habits. For example, one dealer noted, that the "main thing is to establish chemistry between these clients and yourself. It must seem like a friendship, rather than a trandaction. Sending a personal note if they do not return the phone call can create a rapport. "The perception is that these types of customers are unapproachable. But the reverse holds true. They are amenable and approachable." (Tareteta, 2004) by collecting such subjective data, the focus of the reseaerch becomes potentially translatable into forumlating marketing agenda rather than merely a record of high-end consumer behavior.