Louis Vuitton has a handle on the market. Image courtesy of Louis Vuitton. Credits: Landowski Paul, Le Christ Rédempteur © Adagp, Paris, 2016
NEW YORK ? Acquisition of new ultra-high-net-worth (UHNW) consumers will be key to building sales for luxury brands as they adapt to the new normal of annual growth in the 3-5 percent range, down from 8-10 percent during the halcyon days of the past.
The fastest-growing demographic for buying luxury is at the top of the pyramid, according to a presentation by The Boston Consulting Group held last month for Luxury Marketing Council members held in New York.
Households with a net worth of $20 million or more are expected to increase purchases of luxury goods and services by a whopping 80 percent by 2022.
At the same time, aspirational consumers, defined as having a net worth of less than $5 million, will only grow buying by 4 percent per annum in that same period. ?The top of the pyramid will be the driver of luxury growth over the next five years as aspirational consumers take a back seat and marketers come to understand there?s no new China,? BCG managing director Robbin Mitchell told the audience of marketers.
Over-investment in current customers

To increase sales, brands will have to look for new super-rich clients.
Ms. Mitchell said during the past five years brands over-invested in existing customers at the expense of spending to acquire new UHNW customers.
?After 2008, a lot of luxury retailers focused on the top of their file...