Nielsen Study Reveals Emergence of Wealth Market Even in the Midst of an Economic Downturn

Los Alamos, NM Has Highest Percentage of High Income Households, California Has Six of 20 Most Affluent Markets

New York, May 20, 2008-  Despite the economic downturn, the population of affluent Americans–defined as those with household income and income producing assets (IPA) in excess of $100,000–has grown so large that it now makes up the top 19 percent of all U.S. households, according to a recent Nielsen Company analysis.

Deemed the New Mass Affluent, this group’s numbers are rising, with some 22 million households now earning over $100,000, a 23 percent increase from a decade ago after adjusting for inflation, the study showed.

“Earning $100,000 may seem modest compared to the salaries of the big-city elite, but it is more than double the national median income of $49,280,” said Jane Crossan, Vice President of the Financial Services Group at Claritas, Nielsen’s marketing information provider, which conducted the analysis. “There are more higher-earning Americans than ever, signaling a growing opportunity for many business sectors to capitalize on reaching this market. This group controls $22 trillion in assets.”

Crossan documented these and other findings in a recently-completed report titled “Affluence in America,” an in-depth look at America’s changing wealth landscape, that she co-authored with Mike Mancini, Claritas Vice President of Data Product Management.

The report further locates the New Mass Affluent geographically by ranking the top 20 Core Based Statistical Areas (CBSA) based on $100,000-plus in IPA, or liquid financial assets including checking accounts, savings accounts, certificates of deposit, IRAs, mutual funds, retirement accounts, stocks, bonds and securities. A CBSA includes both metropolitan areas of at least 50,000 population and micropolitan areas with a population between 10,000-49,999.

The ranking showed that the New Mass Affluent are increasingly turning up beyond the nation’s beltways in “second cities” like Los Alamos, N.M., the number one ranked market, number three Torrington, CT and number six Naples-Marco Island, FL.

“Now more than ever, companies need a sophisticated understanding of the New Mass Affluent class—who they are, where they live, what products they prefer and how best to market to them,” said Crossan. “To win over the New Mass Affluent, marketers need to develop new products and services, differentiated messages and varied channels to reach these under-the-radar customers.”

Some of the other unlikely upscale markets on the list include number nine Trenton, NJ (due to pockets of gentrification), number 10 Juneau, AK (a thriving state capital) and Easton, MD, a small town rapidly evolving into a retirement community, at number 20.

Unlike traditional power centers like New York and Chicago, where residents possess large incomes and lavish homes, these high-IPA hotspots skew older than average, having attracted many Baby Boomers still adding to their nest egg and active retirees who haven’t begun to crack theirs, Crossan said. (See Table 1 in Full PDF Download Version of release).

Overall, California led the list with six markets, followed by Connecticut with three and Maryland with two. The largest market in California was number five San Jose-Sunnyvale with 593,262 households. The Washington D.C. CBSA was the highest ranking major metro, at number four. The only other major market on the list was Minneapolis at number 15.

About The Nielsen Company

The Nielsen Company is a global information and media company with leading market positions and recognized brands in marketing information (ACNielsen), media information (Nielsen Media Research), online intelligence (NetRatings and BuzzMetrics), trade shows and business publications (Billboard, The Hollywood Reporter, Adweek). The privately held company is active in more than 100 countries, with headquarters in Haarlem, the Netherlands, and New York, USA. For more information, please visit www.nielsen.com.

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