The head of America's leading wealth research institute has warned companies to hold off making changes based on speculation and trends.

Ron Kurtz, president of The Kurtz Group - parent company of the American Affluence Research Center, a well-regarded consultancy for the fractional ownership industry - wrote to subscribers with seven caveats cautioning against business owners being swayed by rhetorical forecasts and patterns.

Kurtz revealed:

1. 

   Ron Kurtz

   Affluent consumers are not prone to substantial changes in their basic behavior and values from year to year or even over an extended period of time. This is evidenced by the research that began in the 1970s by Thomas Stanley, author of "The Millionaire Next Door" and the more recent "Stop Acting Rich and Start Living like a Real Millionaire." Our research since 2002 has been consistent with that of Stanley's.

2. A change from one year to the next is not necessarily a trend, especially if it applies to a large increase in a very small percentage of the market. That is more likely to be a fad that may or may not become a meaningful trend over a period of two or more years. For example, a market segment that triples from 1% to 3% is not a trend but may be an indicator of an emerging market.
3. Affluent consumers are not necessarily luxury consumers. Of course the definition of "luxury" is in the eye of the beholder (which could be another important caveat when considering the forecasts of the trend pundits). Only the wealthiest 1% of U.S. households appear to be knowledgeable about the price points and brands of true luxury products. Before the recession, some luxury consumers were among the so called mass or aspirational affluent. These consumers have been largely shaken out of the true luxury market.
4. It is important to stay focused on the key marketing priorities of attracting new customers and retaining the loyalty and increasing the purchases of existing customers. One should avoid chasing emerging consumer market segments if that will cause them to be distracted and dilute their efforts targeting their existing primary consumer markets.
5. Traditional marketing communications channels should not be forsaken, especially if one is targeting affluent and luxury consumers. The conversations among marketing professionals seem to be exclusively focused on the opinions and statistics regarding the importance of the various forms of digital channels of communications. An "unintended consequence" of digital media is that the consumer audience has been substantially fractionated. While this provides the opportunity to personalize communications, it can also make it more difficult to reach large portions of the target market effectively and cost efficiently. Equally important, many in the large numbers of digital fans and followers of luxury brands are aspirational consumers and other "luxury curious" voyeurs who cannot afford the products.
6. The true affluent, who are typically careful spenders who live within their means, are the more knowledgeable and more sophisticated consumers. Their priorities have always been quality and value when making a purchase decision. In addition, the vast majority of the affluent have always avoided ostentatious or conspicuous consumption. These are not new priorities for the affluent.
7. There is no substitute for using common sense when thinking about how to be consumer sensitive in all aspects of the relationship, interaction, and communication with customers. Just put yourself in the shoes of your customers. This "golden rule" applies to product, pricing, service, post sale relations, communications, and all forms of interaction with the customer.

The American Affluence Research Center specializes in surveys and mailing lists of the affluent, and works in conjunction with The Management Resource Group, which provides strategic marketing consulting services to the travel and hospitality industries. Kurtz has specialized in and researched the affluent market since 1982, when he became the founding President of Sea Goddess Cruises. He holds an MBA from The Harvard Graduate School of Business and a BBA from The University of Texas and established The American Affluence Research Center (www.affluenceresearch.org) in 2001 to provide unique, highly effective marketing research, mailing lists, and consulting services to businesses and organizations targeting the affluent market.