The Effects Of Identity Threats On Luxury Consumption Intentions

Although the traditional virtue of thrift is still being emphasized, consumption of luxury goods has become a social phenomenon in China. Chinese consumers differ significantly from their foreign counterparts in their group characteristics and purchase habits. Prior research shows that luxury goods can function to acquire conspicuousness, uniqueness, quality, hedonism and bandwagon. These motivations, however, are not enough to explain the unique motivation of Chinese luxury consumers. With rapid social transformation, especially from 1978 to 2008, income, prestige, power and other social resources have been restructured, resulting the most widespread social mobility. Individual’s social identity and status have also been changed dramatically. Based on these social background, this article explores the unique luxury consumption motivation of Chinese using theories from social phycology and consumption sociology.This article first reviews past research on luxury goods consumption and social identity theory, and then put forward an assumption that the luxury goods also have important functions in coping with identity threat. The article test the assumption with four studies. Study 1 and study 2 focus on the effect of social identity threat on the luxury consumption intentions and the mediational role of outer-directed symbolic value. Study 3 focus on the effect of personal identity threat and the mediational role of self-directed symbolic value. Study 4 further explores the mechanism.The data reveal that identity threat has a significant positive effect on the luxury consumption intentions. When consumers’identities are threatened, no matter social identity or personal identity, their intentions to purchase luxury goods are stronger versus no identity threat. Particularly, when the social identity is threatened, consumers have higher willingness to buy luxury goods with dominant outer-directed symbolic value, while when the personal identity is threatened, the purchase intention for luxury goods with significant self-directed symbolic value is much stronger. The current investigation makes contributions to social identity theory and research on luxury goods consumption. It also provides some practical implications for market segmentation, target market selection and promotion strategies.