Rock, paper, scissors. Affluent, rich or wealthy? What’s the difference? Does it really matter? Isn’t just attracting clients with lots of money to buy from you all that matters? Wrong. As a business coach who has successfully done business with all three groups, I am here to say that you do need to know the difference and here’s why.

You can only effectively market to a demographic you get to understand. There is a reason why marketers take a lot of time and energy to build an ideal client profile. Although the rules of luxury marketing are slightly different, for instance, luxury sets the price, the price does not set luxury, your ability to segment potential luxury clients will give you a deeper understanding of them in the long term.

A label by any other name

Affluents have enough money to live a comfortable enough lifestyle in the present. The rich have more than enough to have a great retirement and with the wealthy, their resources and assets are trans generational. It therefore makes sense that their buying power and buying motivations will be different.

The differential buying power between the three groups needs to be examined. Shall we assume that an affluent person may be more comfortable buying from an affordable or premium luxury brand, a rich person from a premium core brand and the truly wealthy from a bespoke, ultra high end brand? What actually counts most, when it comes to luxury consumption across the groups is the psychological, that is, feeling good, fitting in and in some cases being able to stand out and prove to the world that they have made it.

The ability to identify the psychological motivations of luxury clients is what makes the Luxury Business Emporium different and this is what many Business Coaches cannot teach.

For instance, the trauma of a pandemic led to revenge spending by some consumers particularly amongst affluents, when lockdown was lifted. Many of such consumers reportedly shopped with luxury brands who remained faithful to their identity. These were brands that did not try to compete with other brands as they recognised that their stability and confidence in their own identity was a great competitive advantage and a huge draw.

So you now need to ask yourself, who do you want to attract? The affluent, the rich or the wealthy. Whichever group you choose, get to know them.