Luxury Consumption Index Reaches 104.8 Points as Luxury Consumers Express Confidence in Economy

STEVENS, Pa.--Jan. 25, 2006--Luxury consumers' confidence rose 10.4 points to reach an all time high at the end of fourth quarter 2005, according to Unity Marketing's exclusive Luxury Consumption Index. This comes after it dropped to 94.4, its lowest point ever, at the end of the third quarter 2005. The index measures luxury consumer feelings about their personal financial status and the prospects for the country as a whole.

"Luxury consumers' attitudes about the economy and their personal financial status have sea-sawed over the last six months, but ended 2005 with a strong upward trend," said Pam Danziger, president of Unity Marketing and author of Let Them Eat Cake: Marketing Luxury to the Masses -- as well as the Classes. "Significantly more luxury consumers feel their personal financial situation is better now than three months ago and that the country overall is better off. But while they feel better, the residual effects of the ups-and-downs they experienced in the recent past makes them a little tighter when it comes to luxury spending. In other words, they are more likely to take any windfalls to the bank, rather than to the store."

In a survey of 1,126 luxury consumers (average income $139.2k and age 41.1 years) conducted in association with Unity Marketing's quarterly luxury consumer tracking study, the typical luxury consumer spent $14,614 on luxuries in the fourth quarter, virtually the same level of spending ($14,534) as reported in the third quarter.

Commenting on the increase in this quarter's Luxury Consumption Index, Thomas Bodenberg, Unity Marketing's economic forecaster said, "The strong increase in the index this quarter reflects a belief that the economy has 'weathered' the effects of Katrina. Also the mild winter has lessened the impact of rising oil prices on heating costs. In addition, the growing opposition to the Iraq War indicates a strong belief that U.S. involvement has a finite limit, given the mid-term election cycle."

Unity Marketing publishes its Luxury Tracking Study quarterly with the next due in March 2006. For more information, visit http://www.unitymarketingonline.com/reports2/luxury/luxury3.html or call Pam Danziger at 717-336-1600.

About Pam Danziger and Unity Marketing

Pamela N. Danziger is a nationally recognized expert specializing in consumer insights for luxury marketers, whether they sell luxury to the masses or the 'classes.' She is president of Unity Marketing, a marketing consulting firm she founded in 1992.

Advising such clients as Lenox, Cartier, Herend, Remy Amerique, Stearns & Foster, Department 56, The World Gold Council, The Conference Board and American Express, Danziger taps consumer psychology to help clients navigate and master the changing luxury marketplace. Her latest book, Let Them Eat Cake: Marketing Luxury to the Masses--as well as the Classes, (Dearborn Trade Publishing, $27, hardcover) is in book stores now. She is the author of the recent book, Why People Buy Things They Don't Need: Understanding and Predicting Consumer Behavior (Chicago: Dearborn Trade Publishing, 2004). She is currently working on her next book about shopping.

She has appeared on CNN's In the Money, NBC's Today Show, CNBC, CNN International, CBS News Sunday Morning, Fox News' Your World with Neil Cavuto, ABC News Now, NPR's Marketplace and is frequently called upon by the Wall Street Journal, New York Times, American Demographics, USA Today, Associated Press for commentary and insight.