• US consumers like luxury if it’s good value
  • They make their smartphones last longer
  • And they like sustainable products

What would US citizens do with extra money? Around 40 per cent would save for a long-term goal and a similar proportion would pay down debt. But more than half would take a holiday, while others prefer luxury purchases such as shoes, watches, jewellery or clothes.

That’s the message 2,000 US consumers with shared household income above USD100,000. Our survey asked 50 questions on their spending, investment and attitudes towards environmental and social issues.

It’s not a representative view of the entire population: about 60 per cent of respondents were millennials aged 21 to 34 – the generation most likely to drive luxury consumption – with another 60 per cent women, and we focused on New York, California, Florida and Texas.

But we found that while US consumers are not opposed to spending, particularly on technology and luxury, value for money is a key driver. And local brands are often preferred, including for jewellery, technology and sporting goods.

Americans are even more confident than when we first surveyed them in January 2018, but 10 months later this new survey shows that translating into increased spending. Some 46 per cent expect wages to grow by more than 2 per cent over the next 12 months, compared to just 28 per cent in January 2018.

On investment, while Baby Boomers bought their first mutual fund when they were almost 35, millennials and Generation X buy them before they reach their late 20s. Investors have a home bias however: 49 per cent buy no international shares and only 10 per cent invest in emerging markets.

Some 22 per cent of millennial investors include environmental, social and governance funds or theme funds, compared to just 8 per cent of over-55s. But the concern extends to spending too: 55 per cent of respondents bought a product advertised as sustainable in the last year.

Men are just as keen as women but while 61 per cent of the under-34s had purchased sustainable products, only 34 per cent of over-55s had. And while 73 per cent of men claim they were likely to purchase an electric car, just 50 per cent of women agreed.

Over 80 per cent of our respondents had purchased a luxury item in 2018 or planned to in 2019, with 74 per cent increasing their spending - millennials and men most eager .

Some 43 per cent of respondents purchase luxury primarily for the quality and 19 per cent like the ‘feel good’ factor. Only 5 per cent buy because celebrities use the product. Styles and designs are considered most important by 75 per cent, price and promotions by 59 per cent, and the prestige of the brand by 51 per cent.

While about 40 per cent of respondents said they’d spend less than USD750 on smartphones, another quarter would go up to USD1,000, and 20 per cent up to USD1,250 with 14 per cent prepared to pay even more. That said, about half would prefer to spend the same as last time – but expect some upgrades.

The proportion of users replacing smart phones every year dropped from 22 per cent to 18 per cent since our first survey.

Elsewhere, 82 per cent of our respondents drink wine and a quarter do not consume beer, most beer drinkers – including 45 per cent of women – want more craft beers. Three-quarters of beer drinkers would like to drink more higher-priced, premium products.

Disclaimer

More, collapsed
Join the conversation?

Join our Linkedin group to get an unparalleled view of macro and microeconomic events and trends from a bank that is a leader in both developed and emerging markets.