Mass affluent and
emerging affluent are
marketingMarketing is the process used to determine what products or services may be of interest to customers, and the strategy to use in sales, communications and business development. It generates the strategy that underlies sales techniques, business communication, and business developments...
terms used to refer to the high end of the
mass marketThe mass market is a general business term describing the largest group of consumers for a specified industry product. It is the opposite extreme of the term niche market.-General:...
. It is most commonly used by the
financial services Financial services refer to services provided by the finance industry. The finance industry encompasses a broad range of organizations that deal with the management of money. Among these organizations are credit unions, banks, credit card companies, insurance companies, consumer finance companies,...
industry to refer to individuals with US$100,000 to US$1,000,000 of
liquid financial assetsIn business, economics or investment, market liquidity is an asset's ability to be sold without causing a significant movement in the price and with minimum loss of value...
, although the exact definition varies. It is also used by marketers of consumer products to refer to consumers with an annual household income of about US$75,000 and up. Mass affluent consumers are an important target market for sellers of
affordable luxuriesAffordable luxuries are goods that can be considered luxury goods according to the marketed image, but which cost less than proper luxury goods. As such, these goods are sold to a larger segment of the market...
.
Difference between upper middle income and mass affluent
There may be a high correlation between the households in the upper-middle reaches of the income strata and the mass affluent, but there are differences. Social class is the result of a person's function within society rather than merely the income of the household in which he or she resides. Both terms refer to people whose
wealthWealth is the abundance of valuable resources or material possessions. The word wealth is derived from the old English wela, which is from an Indo-European word stem...
or
incomeIncome is the consumption and savings opportunity gained by an entity within a specified time frame, which is generally expressed in monetary terms. However, for households and individuals, "income is the sum of all the wages, salaries, profits, interests payments, rents and other forms of earnings...
is above the average, yet below the top. As opposed to households with above average incomes the mass affluent are also defined through liquid assets such as stocks, bonds, cash, and mutual funds are counted. Fixed assets such as real estate are not commonly counted. This is because liquid assets provide more financial flexibility, which is a desirable trait in customers.
The mass affluent have been characterized as those who save more than they spend and invest for their future. While they worry about funding their children's college education, they realize other savings and loan options exist and they are not opposed to their children paying some part of their educational costs. The mass affluent generally may worry about replacing their paycheck in retirement, and may need to be encouraged to spend more money during their retirement years. They often wish to leave an inheritance to their children. The mass affluent will have between $500,000 and $1.5 million (USD) in investable assets upon retirement with a net worth between $500,000 and $2.5 million (USD). They spend between $4,000 and $10,000 (USD) per month in retirement.
Mass affluent in the United States
In the United States there are roughly 33 million mass affluent households, and they own roughly 37% of America's liquid financial assets. Among family households, approximately thirty percent could be described as being mass affluent.
2005 Wealth Distribution of Mass Affluent Households
| Asset Class | Percentage |
| Principal Residence |
23% |
| Investment Real Estate |
14% |
| Liquid Financial Assets |
22% |
| Pension and Employee Retirement Plans |
16% |
| Insurance and Annuities |
9% |
| Privately Held Business |
16% |
See also
- The Professional/Managerial middle class
- Six figure income
- Affluence in the United States
Affluence in the United States refers to an individual's or household's state of being in an economically favorable position in contrast to a given reference group...
- Income in the United States
Income in the United States is measured by the United States Department of Commerce either by household or individual. The differences between household and personal income is considerable since 42% of households, the majority of those in the top two quintiles with incomes exceeding $57,658, now...
- Income quintiles
- Wealth in the United States
Wealth in the United States is commonly measured in terms of net worth, which is the sum of all assets, including home equity, minus all liabilities....
- Luxury good
Luxury goods are products and services that are not considered essential and associated with affluence.The concept of luxury has been present in various forms since the beginning of civilization. Its role was just as important in ancient western and eastern empires as it is in modern societies...
- Status brand
Status brands are brands that, through association, inherently increase their owner's popularity in a certain community. Unlike luxury brands, status brands are usually available at different price points and thus are available to shoppers of various demographics.Trendsetters determine the...
Further reading
External links