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US The Black Premium Brand and Luxury Consumer market report

Black consumers over index vs the general market on buying luxury brands, but it’s not necessarily an exercise simply in conspicuous consumption. Several factors drive luxury brand purchase including the need to have agency of their identity, the desire for elevated status among their peers, and a connection to quality product craftsmanship.

This report examines the following issues:

  • Lower incomes not a barrier to premium item purchases
  • Nearly three in 10 Black consumers are heavy luxury buyers
  • Black consumers prefer the full in-store luxury buying experience vs online shopping
  • Middle and upper income Black households drive luxury purchases
  • Self-perception and social validation are the main drivers for buying premium brands

The concept of luxury goods is inevitably highly subjective. It is usually obvious where a product is luxury and equally obvious where it isn’t, but there is a gray area in between that is more subjective.

The term luxury usually carries with it the idea that a very high level of craftsmanship is involved and that the products carry a high price so that they are out of the reach of most mass-market buyers. Unfortunately, they can also carry connotations of ostentation and conspicuous consumption as a negative personal trait.

In Mintel’s analysis, there are three main categories of luxury goods, to which a miscellaneous group of smaller products is added:

  • Fashion and leather goods;
  • Fragrances and cosmetics;
  • Jewelry and watches;
  • Other (ie writing instruments, eyewear, furniture, home goods, and other miscellaneous items).

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

          • The issues
            • Lower incomes not a barrier to premium item purchases
              • Figure 1: Past 18 month luxury brand purchases, by total US and Black, June and August 2016
            • Nearly three in 10 Black consumers are heavy luxury buyers
              • Figure 2: How many types of luxury purchases Blacks made in the last 18 months, August 2016
            • Black consumers prefer the full in-store luxury buying experience vs online shopping
              • Figure 3: Where Blacks purchase luxury products, August 2016
            • Middle and upper income Black households drive luxury purchases
              • Figure 4: How many types of luxury purchases Blacks made in the last 18 months, by household income, August 2016
            • Self-perception and social validation are the main drivers for buying premium brands
              • The opportunities
                • Expand brand and retail communications to include Black consumers
                  • Figure 5: Von Maur/Lancôme e-mail featuring Lupita Nyong’o, February 2015
                • Extend exclusive designer event invitations to untapped Black buyers
                  • Figure 6: Carson’s invitation to private shopping and runway show, October 2016
                • What it means
                • The Market – What You Need To Know

                  • Population shifts to mirror total US
                    • Black households are economically rebounding from the recession…somewhat
                      • Black inclusion in the fashion industry remains elusive
                      • Black Population by the Numbers

                        • Modest Black population growth compared to other groups
                          • Figure 7: Population by race and Hispanic origin, 2011-21
                        • Age of Black population shifts older
                          • Figure 8: Share of Black population by age, 2011-21
                      • Market Perspective

                        • Black consumers often credited for driving fashion trends
                          • Some brands embrace Black cultural icons, while others shun the association
                            • Blacks’ sometimes strained relationship with designers and retailers
                            • Market Factors

                              • Black labor force participation nearing parity with total US
                                • Figure 9: Labor force participation, by Black and total US, January 2007-September 2016
                              • Black unemployment recovering slowly post recession
                                • Figure 10: Unemployment, by Black and total US, January 2007-September 2016
                              • Median household income 35% below total
                                • Figure 11: Median household income, by race and Hispanic origin of householder, 2008-15
                              • …but middle-class households see modest growth post recession
                                • Figure 12: Black median household income distribution, 2015
                                • Figure 13: Share of Black household with median household income $75K+, 2005-15
                            • Key Strategies – What You Need to Know

                              • Popularity of luxury brands and goods depend on Black consumer lifestage
                                • Black consumers expect the full luxury experience while shopping in store
                                  • Black-owned brands and designers receive recognition among the masses
                                  • What’s Working?

                                    • Black luxury buyers are not hindered by price
                                      • Luxury brands that embrace Black buyers move to the top of their favorites list
                                        • Brick and mortar locations rule with Black luxury buyers
                                        • What’s Struggling?

                                          • Black Millennials are abandoning categories that drive luxury purchases
                                          • What’s Next?

                                            • Black niche, bespoke designers gaining awareness
                                              • Fashion collaborations between underground artists and established brands
                                              • The Consumer – What You Need to Know

                                                • Black women are discount luxury consumers, Black men prefer the luxury experience
                                                  • Black Millennials are willing to pay any price to own coveted luxury goods
                                                    • Brands offering goods in Black consumers’ top categories are the most desired
                                                      • Self-perceptions overrule product descriptions in describing luxury items
                                                      • Number of Types of Luxury Brand Purchases

                                                          • Most luxury brand Black consumers buy within one to two categories
                                                            • Figure 14: How many types of luxury purchases Blacks made in the last 18 months, August 2016
                                                          • Black women are heavy luxury purchasers across multiple categories
                                                            • Figure 15: How many types of luxury purchases Blacks made in the last 18 months, by gender, August 2016
                                                          • Black Baby Boomers are the lightest luxury buyers across all generational groups
                                                            • Figure 16: How many types of luxury purchases Blacks made in the last 18 months, by generation, August 2016
                                                          • Affluent households drive luxury purchases, but low- to middle-income families not far behind
                                                            • Figure 17: How many types of luxury purchases Blacks made in the last 18 months, by household income, August 2016
                                                          • More singles buy luxury items, but married couples close the gap with heavy purchases
                                                            • Figure 18: How many types of luxury purchases Blacks made in the last 18 months, by marital status, August 2016
                                                        • How Blacks Define Luxury

                                                            • Black consumers give greater weight to self-perception vs product attributes
                                                              • Figure 19: How Blacks define luxury, August 2016
                                                            • Black men and women share the similar definitions of luxury with few stark differences
                                                              • Figure 20: How Blacks define luxury, by gender, August 2016
                                                            • As incomes rise, superficial definitions wane in importance
                                                              • Figure 21: How Blacks define luxury, by household income, August 2016
                                                            • External validation from luxury is mixed across generations
                                                              • Figure 22: How Blacks define luxury, by gender and generation, August 2016
                                                            • College degreed Blacks less likely to assign self-worth to luxury items
                                                              • Figure 23: How Blacks define luxury, by educational attainment, August 2016
                                                          • Blacks’ Luxury Purchases

                                                              • Less than half of Black consumers purchase luxury items
                                                                • … but they over index vs the total population
                                                                  • Figure 24: Past 18 month luxury brand purchases, by total US and Black, June and August 2016
                                                                • Luxury purchases among Black consumers skew male
                                                                  • Figure 25: Blacks' past 18 month luxury brand purchases, by gender, August 2016
                                                                • Black consumers with kids more likely to buy luxury products
                                                                  • Figure 26: Blacks' past 18 month luxury purchases, by marital status and parental status, August 2016
                                                              • Blacks’ Luxury Purchasing Habits

                                                                  • Black consumers will indulge in luxury purchases if discounted
                                                                    • Figure 27: Blacks' luxury purchasing habits, August 2016
                                                                  • Black women seek discounts, Black men want the experience
                                                                    • Figure 28: Blacks' luxury purchasing habits, by gender, August 2016
                                                                  • Millennials are not as price conscious in their luxury purchase behavior
                                                                    • Figure 29: Blacks' luxury purchasing habits, by generation, August 2016
                                                                  • Middle-income households willingness to buy luxury goods hinges on discounts
                                                                    • Figure 30: Blacks' luxury purchasing habits, by household income, August 2016
                                                                  • Heavy luxury buyers have lower purchase criteria
                                                                    • Figure 31: Blacks' luxury purchasing habits, by number of types purchased, August 2016
                                                                • Types of Luxury Products Blacks Purchase

                                                                    • Black consumers prefer personal wear vs other luxury categories
                                                                      • Figure 32: Types of luxury products Blacks purchased, August 2016
                                                                    • Black men buy more luxury personal wear than do women
                                                                      • Figure 33: Types of luxury products Blacks purchased, by gender, August 2016
                                                                    • Younger Blacks gravitate toward luxury items that express personal style
                                                                      • Figure 34: Types of luxury products Blacks purchased, by generation, August 2016
                                                                  • Where Blacks Purchase Luxury Products

                                                                      • Physical stores offer Black consumers the luxury experience
                                                                        • Figure 35: Where Blacks purchase luxury products, August 2016
                                                                        • Figure 36: Attitudes and opinions about shopping, by Black adults vs all adults, index to all, April 2015-June 2016
                                                                        • Figure 37: Where luxury items are purchased, by total US and Black, June and August, 2016
                                                                      • Black women seek luxury bargains, while Black men shop directly with preferred designers
                                                                        • Figure 38: Where Blacks purchase luxury products, by gender, August 2016
                                                                      • iGens and Millennials drive online luxury purchases
                                                                        • Figure 39: Where Blacks purchase luxury products, by generation, August 2016
                                                                      • City dwellers prefer to shop in store, but also dominate online shopping
                                                                        • Figure 40: Where Blacks purchase luxury products, by area, August 2016
                                                                      • Heavy luxury brand shoppers browse everywhere, light shoppers look for specific items where they are easy to find
                                                                        • Figure 41: Where Blacks purchase luxury products, by number of types purchased, August 2016
                                                                    • Luxury Brands Blacks Desire Most

                                                                        • Trendy brand names top Black purchasers luxury list
                                                                          • Figure 42: Luxury brands Black luxury good purchasers desire most, August 2016
                                                                        • Brands with items in category favorites for men and women impact their opinion
                                                                          • Figure 43: Luxury brands Black luxury good purchasers desire most, by gender, August 2016
                                                                        • Upper-income households drive purchases across the top brands
                                                                          • Figure 44: Luxury brands Black luxury good purchasers desire most, by household income, August 2016
                                                                      • Blacks’ Perceptions of Luxury Brands

                                                                          • Blacks’ perception of luxury brands span three dimensions: social validation, economics of luxury, and cultural considerations
                                                                            • Luxury brands contribute primarily to Black consumers’ social validation
                                                                              • Figure 45: Blacks' perceptions of luxury brands – social validation, by all and luxury purchasers, August 2016
                                                                            • Price not a deterrent for Black luxury brand purchasers to showcase their heighted image
                                                                              • Figure 46: Blacks' perceptions of luxury brands – Economics, by all and luxury purchasers, August 2016
                                                                            • Black women expect representation among luxury brands
                                                                              • Figure 47: Black luxury brand buyers' perceptions of luxury brands, by gender, August 2016
                                                                          • Appendix – Data Sources and Abbreviations

                                                                            • Data sources
                                                                              • Consumer survey data
                                                                                • Abbreviations and terms
                                                                                  • Abbreviations

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