The following chapters in Part II provide details about consumer purchases of 37 discretionary/luxury product categories. They are divided into three broad categories: entertainment, recreation, and hobby products; home and home decorating products; and personal luxuries, such as jewelry, apparel, and personal care.

These sections are designed for readers' grazing and skimming, rather than for careful reading page after page. They provide basic reference material about the size and growth of the market segment, as well as a summary of consumer research into each of the 37 product categories.

Yet while I advise skimming coming sections, it is important to recognize that competition for what people buy has suddenly gone horizontal rather than vertical. In business we are trained to think of our competitors within a narrow band of vertically defined categories, so a candle company competes with other candle companies, a traditional department store competes with other traditional department stores. But companies and retailers today compete horizontally across many different industries and product categories for the only true measure of success: the consumers' discretionary dollar. That means companies that sell home products compete with apparel companies and entertainment companies. Retailers that sell clothes compete with home retailers and entertainment retailers for their sales. Everyone everywhere is competing with everybody else for a limited resource—the consumers' discretionary spending. Today marketing and retailing executives must learn how to function in this immeasurably more complex competitive environment.

Connecting means you place the consumer's needs, desires, priorities, and concerns first.

In this new horizontally oriented competitive landscape, companies will achieve success only in so far as they tap into the hearts, minds, and desires of their target market. The consumers' discretionary pocketbook has never been larger. Consumers will ultimately decide the fate of companies that don't hearken to their needs and desires. Therefore, the coming discussion of the 37 different products takes on important implications for all marketers and retailers who seek to really connect with their consumer. Every consumer product company ultimately is in the consumer satisfaction business and the coming sections will help everyone understand the depth and scope of consumers' desires more completely.

These sections are designed for readers' grazing and skimming.

Chapter 6: What People Buy: Personal Luxuries


The business of looking good is a major contributor to the U.S. economy. The market for clothes, jewelry, and fashion accessories and fashion services, such as dry cleaning, totaled $405.5 billion in 2002, while consumer expenditure on personal care articles including cosmetics and spending on beauty parlors, barbershops, and health clubs reached $97.2 billion. While food, clothing, and shelter are thought to be basic necessities of life, the reality is most clothing purchases are driven by fashion (i.e., a luxury desire) not need. For most Americans today, our closets are full and we simply don't need to shop for clothes. Because we don't need any more new clothes, we tend to look for justifiers that give us permission to buy, such as needing a new outfit for a special occasion, or finding something really great on sale. Clothing is no longer part of the basic necessities of life. For most of us, clothes and fashion are luxuries that make our lives more pleasurable, more fulfilling, more exciting, more rewarding, and more fun.

While most consumers recognize the importance of dressing right for every occasion and presenting a good self-image when out in society and at work, many of us are simply not willing to devote the time, energy, and money that dressing more stylishly or fashionably requires. Just over 40 percent of personal luxury shoppers agree with the statement: I would like to dress more stylishly, but I don't have the time and/or money that it takes to achieve it. Dressing fashionably is sort of like taking vitamins. We all know it is good for you and we should do it, but only the most passionate minority makes it a point to take vitamins every day.

Clothes and fashion are luxuries that make our lives more pleasurable, more fulfilling, more exciting, more rewarding, and more fun.

So most Americans are satisfied with their fashion and style sense, even if they know it is not quite up to par. Being unwilling to invest the effort necessary to dress better, we tend to think that everybody else spends more time, money, and effort to look better than we do.