Rise of the Precision Consumer

Two weeks ago, American Express Publishing and marketing consultants at the Harrison Group released the 2010 Survey of Affluence and Wealth in America. The report details changes in the spending habits of wealthy consumers since the beginning of the Great Recession. This latest survey is an excellent indicator of long-term effects of the contraction, since consumers have emerged from their foxholes and are spending again.

One important trend documented is the emergence of wealthy "Precision Consumers." Whereas four-five years ago, these folks loosened their wallets in every category – from apparel to electronics to autos, spending liberally on everything. The Precision Consumer is still interested in luxury products but is better researched and more careful to purchase. They spend liberally in select categories where they feel luxury delivers value and fulfills explicit needs and wants.

This week, a MasterCard Advisors Spending Pulse report showed further evidence of the rise of the Precision Consumer. Spending in the electronics category is growing while apparel spending growth is stagnant. Of course, if you saw the lines outside of Apple stores last month, you didn't need to read a bunch of spending surveys to come to the same conclusion.