Amazon Attracting High-Income Customers

December 17, 2013

This article is included in these additional categories:

Digital | Household Income | Retail & E-Commerce

Shullman-Amazon-Customers-Shopping-Frequency-by-HHI-Dec2013Amazon is in excellent standing among upscale consumers – and could be a strong force in the luxury and affluent marketplaces, according to [download page] new data from the Shullman Research Center. The research indicates that the Amazon customers’ average household income is roughly $89,000, compared to the $71,000 average for the US as a whole, using Census Bureau figures. Moreover, almost 1 in 5 of Amazon’s customers in the $500,000+ bracket claim to make a purchase on Amazon once a week or more.

The study also finds that the higher their household income (HHI), the more likely that customers are to be enrolled in Amazon Prime. Some 29% of respondents with HHI of at least $500k reported being enrolled in Amazon Prime, which equates to upwards of 45% of its current customer base in that income bracket. By comparison, 17% of US adults on average (or 29% of customers) have enrolled in Amazon Prime. (Prior survey research from Parago has also found that membership in Amazon Prime tends to be higher among higher-income respondents.)

The Shullman research also takes a look at Amazon customers’ attitudes, noting that:

  • While 71% of adults who have bought from Amazon in the past 12 months like to buy American products and services, that figure declines alongside rising household income, to 49% of the $500k+ bracket;
  • Tendency to buy based more on quality rather than price grows from 45% of customers on average to 72% among the highest-earners;
  • Although 35% of customers agree that they like to buy designer or luxury brands, that figure rises to 59% among customers in the top bracket;
  • Higher earners are also more likely to seek out superior service when shopping, an area in which Amazon is extremely well positioned; and
  • Celebrity endorsements (which don’t appear to carry that much weight) don’t matter much to Amazon customers (16% sometimes buy products endorsed by celebrities), but matter even less to the top-earners (8%).

In terms of Amazon’s potential standing in the luxury marketplace, one stat is singled out: 72% of its highest-earning customers have bought a luxury product or service during the past 12 months from a retailer.

About the Data: The insights and data presented in the report are based on the Shullman Luxury and Affluence Monthly Pulse, Fall 2013 Preview Wave, conducted online between August 20 and August 27, 2013, among adults age 18 or older. Five sample groups were surveyed: in addition to a representative national sample of adults (500 interviews), four household-income segments were targeted to obtain the following number of completed interviews:

  • $75,000 to $149,999: 256
  • $150,000 to $249,999: 253
  • $250,000 to $499,999: 253
  • $500,000 or more: 251

Results were weighted to bring these income groups, as well as other key demographics, into line with estimates from the March 2012 Current Population Survey as reported by the Bureau of the Census in the fall of 2012.

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