Walmart: Retailers Target High-Income Shoppers Fashion Budgets


In a bid to cultivate loyalty among high-income consumers, retailers are setting their sights on capturing a share of their generous fashion expenditures.

Image Credits: pymnts

According to the February/March edition of the PYMNTS Intelligence series, titled “New Reality Check: The Paycheck-to-Paycheck Report: Why One-Third of High Earners Live Paycheck to Paycheck,” insights gleaned from a January survey of over 4,200 U.S. consumers shed light on spending behaviors across income brackets. Notably, the research revealed that affluent earners are willing to allocate a substantial portion of their earnings towards clothing and other fashion-related indulgences.

The study found that individuals earning over $200,000 annually devote the largest proportion of their income to clothing, accessories, and personal care items, amounting to 8.5% compared to the national average of 7.2%. Furthermore, those earning above $100,000 were most inclined to perceive clothing and personal care as having a significant impact on their budget over the past year.

In response, retailers are tailoring their apparel offerings to cater to this demographic. Luxury fashion eCommerce platform Mytheresa, for instance, disclosed during its recent earnings call a shift in focus towards affluent shoppers, emphasizing their superior economics and loyalty metrics.

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However, the trend isn’t limited to luxury brands alone. Mass-market retailers like Target and H&M are also adjusting their product assortments to include offerings that resonate with high-income consumers. Collaborations with upscale designers enable these retailers to offer elevated yet accessible lines, aligning with their value propositions.

Observing this trend, PYMNTS’ Karen Webster noted, “For Target, it’s a way to pay off its ‘expect more, pay less’ brand proposition and amplify the ‘Tarjay’ moniker coined by shoppers who like the idea of buying upscale designer products without the upscale designer price tags.”

Moreover, research from PYMNTS Intelligence indicates a shifting preference among affluent shoppers towards direct-to-consumer (D2C) channels. Luxury brands are ramping up their D2C efforts, while traditional retailers grapple with the evolving retail landscape.

This shift is underscored by data showing that individuals earning over $100,000 annually exhibit a greater preference for shopping directly from a brand’s online store compared to traditional retailers. The growing appeal of D2C channels among high-income consumers signals a transformative shift in the retail paradigm, posing challenges for traditional retail players.

As retailers adapt their strategies to appeal to affluent shoppers’ discerning tastes, the fashion retail landscape undergoes a notable evolution, marked by a convergence of luxury, accessibility, and digital innovation.

Data Source: pymnts

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