Roy Morgan: Brands look to premium customers to recession-proof

Challenging economic times call for brands to focus on the premium customers says retail research institute

In challenging economic times, brands need to look to the premium end of the market to find growth, according to the Roy Morgan Research Institute.

The research firm has conducted a national survey of Australia’s high-spending premium consumers to identify their favourite brands. Three retail brands featured in the top 10, which the Institute said tells the story of the economy’s current woes.

Roy Morgan found Vintage Cellars to be the standout premium brand both nationally, while the David Jones brand appeared to retain attractiveness to premium spenders, despite its recent challenges.

Roy Morgan ranking of Australia’s top-10 premium brands

1. Vintage Cellars (Coles Group)

2. Audi

3. American Express

4. Qantas (international)

5. Harris Farms Markets

6. David Jones

7. UniSuper

8. Zara

9. Emirates

10. Lexus

Overall, Roy Morgan noted the economy is slowing, with consumer spending in decline. The proof is in the numbers as ABS data released last week showed consumer spending was outstripped by household saving for the first time in five years, while the retail sector has slumped to its weakest level since the 1990s. Yet that's not the only story.

Roy Morgan CEO, Michele Levine, noted consumer spending is being cut in some areas, while going up in others - the feature of a two-speed economy, driven by premium and budget consumers. In line with this, the term 'premium' applies not only to brands and experiences, but also to consumers, she said.

“The word ‘premiumisation’ is on the lips of business leaders eyeing off the economic fast lane while, at the same time, the slow lane is becoming even more commoditised. In today’s slowing economy the premium market is thriving,” Levine commented.

Roy Morgan said its research found there are 10 million Australian consumers in the economy’s ‘slow lane’, and 4.7 million premium consumers in the ‘fast lane’. Furthermore, 91 per cent of premium consumers are in the top-third of elective spenders in the economy.

To harness growth in challenging economic times, particularly with the prospect of a potential period of recession, brands need to be sure they appeal to premium customers, Levine said.

“Business leaders are now recession-proofing their brands by recognising (a) there is a two-speed economy, and (b) they can now reach, motivate, and acquire these truly premium consumers as their most valuable customers,” she added.

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, follow our regular updates via CMO Australia's Linkedin company page, or join us on Facebook: https://www.facebook.com/CMOAustralia. 


Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Blog Posts

Sustainability trends brands can expect in 2020

​Marketers have made strides this year in sustainability with the number of brands rallying behind the Not Business As Usual alliance for action against climate change being a sign of the times. While sustainability efforts have gained momentum this year, 2020 is shaping up to be the year brands are really held accountable for their work in this area.

Ben King

CSR manager & sustainability expert, Finder

The trouble with Scotty from Marketing

As a Marketer, the ‘Scotty from Marketing’ meme troubles me.

Natalie Robinson

Director of marketing and communications, Melbourne Polytechnic

How do we break out of our marketing echo chambers?

Clients and agencies can get stuck into a particular way of behaving and viewing the world, but there are ways to break out of our marketing echo chamber.

Steve O'Farrell

Managing Partner, The Royals

Instagram changes algorithms every time you get used to them. It really pisses me off. What else pisses me off? The fact that Instagram d...

Nickwood

Instagram loses the like in Australia; industry reacts positively

Read more

I tried www.analisa.io to see my Instagram Insight

Dina Rahmawati

7 marketing technology predictions for 2016

Read more

The saying is pretty tongue in cheek. It's not saying that marketers are bad people, nor that they don't take themselves seriously. There...

LYF Solutions

The trouble with Scotty from Marketing - The CMO view - CMO Australia

Read more

Given Scotty's failed track-record in the marketing realm the memes and the ridicule is very apt and is in no way a reflection on marketi...

denysf

The trouble with Scotty from Marketing - The CMO view - CMO Australia

Read more

alone quotes

RB Forever

5 CMOs reflect on 2019, achievements and lessons learnt

Read more

Latest Podcast

More podcasts

Sign in