Abstract
The primary objective of this study was to understand the U.S. consumers’ luxury value perceptions using Luxury Value Perception (LVP) model (Wiedmann, Hennigs & Siebel, 2009). The study replicated the procedure used in Wiedmann et al.’s (2009) article to validate the dimensions of the LVP model in the U.S. context. Data were collected using an online survey through Amazon Mechanical Turk. The findings revealed the applicability of the LVP model in the U.S. context and revealed interesting differences in luxury value perceptions among U.S. and German consumers. This study advances theory as it is the first to validate the latent luxury value construct as influenced by individual, social and functional luxury value perceptions in the U.S. context. The LVP model helped identify luxury value drivers of U.S. consumers and cluster them in homogenous segments. These findings may potentially help U.S. luxury brand marketers to know the needs and values of different customer segments, ultimately helping them to develop effective brand positioning strategies in a competitive marketplace.
Highlights
The luxury market continues to grow substantially worldwide
The global luxury marketplace is becoming highly competitive with consumers exposed to a variety of information from different channels
The purpose of this study was to understand value that U.S consumers attached to luxury consumption after global recession
Summary
The luxury market continues to grow substantially worldwide. According to Deloitte’s Global Powers of Luxury Goods report (2017), the global luxury market was worth US$212 billion in 2015 with an average luxury goods sales of top 100 companies equaling to $2.1 billion. The luxury market grew by 5% to an estimated $1.5 trillion in 2017 (Bain, 2017). Though the U.S is leading sales – approximately $85 billion in the global luxury market, it experienced a slow growth in 2016. Industry experts predict the U.S luxury goods market to increase by a further US$18.5 billion by 2021 (Danzinger, 2017; Roberts, 2017). Marketers have realized the importance of understanding the new luxury consumer, and will need to accommodate digital savvy consumers who increasingly lead on-the-go lifestyles
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