Luxury Consumption Tendency: A Comparative Study Between Chinese and Portuguese Consumers

Abstract

A statistical model comparing national and cultural differences in luxury consumption tendencies is presented in this paper. The objective is to investigate the factors influencing luxury consumption tendency, such as social influence, conspicuous consumption, and brand image, and their impact on consumer purchasing behavior and life satisfaction. Specifically, the Tend and Befriend Theory, the Compensatory Control Theory, and the Technology Acceptance Model are utilized to analyze the model. The quantitative analysis is based on cross sectional data with 401 valid questionnaires from Portugal and 369 from China. Comparative analysis is conducted to evaluate attitudes toward luxury consumption tendencies in both Chinese and Portuguese samples. The results indicate that social influence, conspicuous consumption, and brand image have a positive effect on luxury consumption tendencies. Moreover, luxury consumption tendencies are positively correlated with life satisfaction, the urge to buy, and luxury spending. Differences between Portuguese and Chinese consumers are observed, attributed to cultural variations. This study enhances our understanding of consumer behavior in luxury markets by elucidating influential relationships that impact consumer decision-making and life satisfaction, while also highlighting cultural influences.

Keywords:

• Luxury consumption tendency
• social influence
• conspicuous consumption
• brand image
• life satisfaction
• urge to buy

Introduction

The global luxury market has experienced significant sales growth in the past decade, with a projected sales value of over 330 billion euros for personal luxury goods in the next ten years (Shahid et al., 2021). Rapid development and high profitability are key characteristics of the luxury industry (Dogan et al., 2020). The Covid-19 pandemic had a substantial impact on the global luxury market, resulting in an approximate decline of 86 billion euros in luxury goods sales. Notably, the Chinese luxury sector witnessed a pandemic boom, unlike other regions (Javornik et al., 2021). Portugal, as a classic European transition economy, was significantly affected by the pandemic’s impact on the luxury market as the most developed European countries (Javornik et al., 2021). Therefore, comparing China and Portugal regarding luxury consumption can provide valuable insights into different socio-economic factors and cultural dynamics, impacting consumer behavior and luxury markets in different regions (Ko et al., 2019). China and Portugal represent vastly different markets in terms of size and growth potential. China, as one of the world’s largest economies, has a burgeoning middle class and high-net-worth individuals (HNWIs) segment, contributing significantly to luxury consumption. In contrast, Portugal, while smaller in size, might offer insights into luxury consumption patterns in a European context and within a relatively smaller market (Javornik et al., 2021). Both countries have enormous cultural influences that shape consumer preferences and attitudes toward luxury goods. Understanding how cultural values, traditions, and perceptions impact luxury consumption can help luxury brands tailor their marketing strategies effectively (Shao et al., 2019).

Luxury consumption is closely linked to hedonic consumption, customer loyalty, and brand equity (Javornik et al., 2021; Truong & McColl, 2011; Wang & Tong, 2017). Research on luxury consumption can be categorized into three areas: consumer perceptions of luxury brands, consumer views and feelings about luxury, and reasons and effects of luxury goods purchases (Athwal et al., 2019; Leban et al., 2020; Shukla, 2011; Sung et al., 2015). Although pre-pandemic studies have examined the drivers of luxury consumption, there is limited research on luxury consumption during the pandemic period (Peng & Chen, 2021; Wang et al., 2022). Furthermore, there is a lack of research exploring the social factors and conspicuous needs that underlie luxury consumption (Verdugo and Ponce, 2023). The motivations behind consumer attitudes toward luxury consumption remain unclear (Dogan et al., 2020; Javornik et al., 2021). Therefore, understanding cultural differences and the social factors that influence luxury consumption is crucial for premium brands to comprehend consumer perceptions and cater to their needs (Chu et al., 2021; Dogan et al., 2020).

The “tend and befriend” theory (Taylor, 2012) suggests that individuals who feel socially isolated may engage in luxury consumption to gain approval from those who frequently indulge in luxury. While this theory sheds light on how social factors and brand image can impact luxury consumption, further exploration is warranted (Chu et al., 2021). Additionally, the compensatory control theory (Kay et al., 2009) offers an explanation for the impacts of luxury consumption, including the urge to buy, luxury spending, and overall life satisfaction, which are critical variables for market sustainability and growth (Chatzidakis, 2015; Mainolfi, 2020).

To address these gaps, this research focuses on three drivers of luxury consumption: social influence, conspicuous consumption, and brand image (Isaac, 2020). The "tend and befriend" theory (Taylor, 2012) suggests that social factors can contribute to understanding the democratization of luxury consumption. Social influence refers to an individual’s perception of others’ opinions on engaging in a particular behavior (Zhang et al., 2020), which may explain the differential effects of the pandemic on luxury markets in Portugal and China. Conspicuous consumption involves purchasing and displaying expensive goods to make a social impression (Goenka & Thomas, 2019). Luxury purchases serve self-expression purposes, and conspicuous consumption showcases the social status of luxury product owners (Isaac, 2020). Brand image reflects people’s perceptions of a brand based on associations stored in memory (Keller, 1993), which is a crucial indicator of consumer attitudes toward luxury brands. Understanding the relationship between brand image and luxury consumption is valuable for effective marketing and meeting customer needs (Iglesias et al., 2019). The compensatory control theory (Kay et al., 2009) offers reasons and explanations for the mediating role of luxury consumption in life satisfaction, urge to buy, and luxury spending (Chatzidakis, 2015; Mainolfi, 2020; Wang & Tong, 2017).

This study aims to address the following research questions: What are the dominant social attitudes toward luxury brands in China and Portugal, and how have social motivators influenced luxury consumption after the pandemic? Furthermore, how does it impact consumer well-being? Therefore, to fill these gaps our objectives are to investigate how social influence, conspicuous consumption and brand image may influence luxury consumption tendency and, through it, impact the luxury spending and urge to buy, as well as customer life satisfaction.

This study offers several innovations. Firstly, it identifies consumer characteristics related to luxury consumption tendency. Secondly, it assists luxury brand owners in better positioning themselves and meeting consumer needs. Thirdly, it provides insights for future research on social factors’ influence on luxury consumption tendency and its impact on daily lives and future sales. These results improve our understanding of the current situation and help luxury brands overcome the challenges posed by the global disaster.

This study compares cultural differences between Chinese consumers, who are relatively new to luxury markets, and Portuguese consumers, who have more experience . A quantitative method employing a structured questionnaire was used to collect data from two samples: 380 Chinese and 403 Portuguese luxury buyers. Structural equation modeling (SEM) was employed to test hypotheses and compare luxury consumption between the two groups.

Research background and hypothesis development

Luxury consumption tendency

The term “luxury” has roots in ancient Greek, Egyptian, and Roman cultures and retains its meaning and underlying motives today. Luxury is associated with superior quality, uniqueness, non-essential nature, and high price (Athwal et al., 2019; Beverland, 2004). Luxury products are known for their extravagant craftsmanship and materials. Scholars argue that luxury should be associated with high-end, non-essential products and services that are perceived as rare, prestigious, and authentic, providing high levels of symbolic and emotional/hedonic value through customer experiences (Bazi et al., 2020).

Understanding consumer tendencies in luxury consumption is crucial for studying luxury consumption. Bain and Forsythe (2012) highlight the significance of purchasing luxury goods and/or services in shaping modern lives in Western and developing cultures. Luxury consumption can have a profound impact on well-being and human life (Kastanakis & Balabanis, 2014).

Consuming luxury products offers various benefits, classified into social and psychological categories by Shukla (2011). Meanwhile, the benefits will impact on consumers behavior, preference and tendency as well. To enhance comprehension of luxury consumption tendencies, scholars have begun to investigate the motivational factors influencing such behaviors (Athwal et al., 2019). Prior to the onset of the Covid-19 pandemic, researchers developed several models rooted in political considerations and brand prominence (Han et al., 2010; Sun et al., 2014). However, the focus of research shifted toward consumer and product characteristics during the pandemic. Dogan et al. (2020) proposed a model based on luxury product attributes, encompassing uniqueness, expense, and symbolic significance. Additionally, some scholars have delved into the concepts of self-monitoring and self-construal (Lee et al., 2021). Nevertheless, previous studies have overlooked social factors and brand identities from the consumer’s perspective. Social influence can significantly influence various purchasing behaviors and trends (Zhan & He, 2012).

To fully grasp luxury consumption tendency, psychological theories are employed (Kastanakis & Balabanis, 2014). The “tend and befriend” theory (Taylor, 2012) provides an explanatory framework for luxury consumption tendencies. Luxury consumption tendency can serve as a means to gain social acceptance from groups engaging in such behaviors, reducing the risk of social marginalization. Ostentatious spending helps individuals overcome feelings of social rejection . In order to gain more benefits from luxury consumption tendency, conspicuous consumption will occur between luxury customers and influence luxury consumption tendency deeply (Truong & McColl, 2011). Furthermore, only if the luxury brands hold better brand image among the customers, the customer could get the benefits from their purchase behavior and tendencies (Chu et al., 2021).

The compensatory control theory (Kay et al., 2009) proposes that luxury consumption is driven by a need to compensate for a perceived lack of personal control (Rucker & Galinsky, 2008). When individuals feel their power is diminished, they may turn to external sources of control, including luxury consumption, to regain a sense of control. Luxury items’ potential to provide social influence further reinforces this behavior (Dogan et al., 2020).

Table 1 shows how tend and befriend theory suggests that in response to stress or threat, individuals seek social connections and support (tend) and engage in affiliative behaviors (befriend) (Taylor, 2012). Within this framework, luxury consumption can be viewed as a form of social signaling and affiliation, where individuals use luxury goods to enhance their social status and forge connections with others (Wan et al., 2014). Social influence (Schade et al., 2016), brand image (Chu et al., 2021), and conspicuous consumption (Truong & McColl, 2011) are key factors in this process. Social influence shapes individuals’ perceptions of what is desirable and prestigious, influencing their tendency to engage in luxury consumption (Truong & McColl, 2011).

Table 1. Construction.

Basis	Linked Construct	References
The Tend and Befriend Theory	Social Influence	(White & Simpson, 2013; Zhan & He, 2012)
	Brand Image	(Chu et al., 2021; Hackley & Hackley, 2015)
	Conspicuous Consumption	(Dogan et al., 2020; Truong & McColl, 2011)
The Compensatory Control Theory	Life Satisfaction	(Wang & Tong, 2017; Wang et al., 2022)
	Urge to Buy	(Georgia, 2019; Hagtvedt & Patrick, 2016)
The Technology Acceptance Model	Luxury Spending	(Mainolfi, 2020; Ki et al., 2017)

Compensatory control theory suggests that individuals seek to regain a sense of control and predictability in the face of uncertainty or threat (Kay et al., 2009). Luxury consumption can be seen as a means of exerting control over one’s environment and asserting status and identity (Rucker & Galinsky, 2008). Therefore, social influence may influence individuals to conform to societal norms and standards of success, providing a sense of predictability and control (Dogan et al., 2020). Brand image contributes to perceptions of quality, prestige, and exclusivity, offering a sense of control through association with desirable brands. Conspicuous consumption allows individuals to assert their status and identity, thereby regaining a sense of control in uncertain situations, impacting their life satisfaction (Wang et al., 2022) and buying behavior (Dameyasani & Abraham, 2013).

Culture dimensions

Hofstede’s Dimensions provide insights into how individuals from different countries and cultures perceive and interpret the world, based on six dimensions: power distance, individualism-collectivism, masculinity-femininity, uncertainty avoidance, long-term orientation, and indulgence (Hofstede, 2011). These dimensions will be used to explore the differences found in this study. The cultural positions of China and Portugal highlight significant disparities across these six dimensions (Hofstede, 2011). Therefore, Portuguese culture still present more similarities with the other western countries, which are far from the Chinese traditions (Moleiro et al., 2017). Therefore, Portugal is an interesting country to compare with China. Portuguese culture exhibits moderate power distance (Index = 63), low individualism (Index = 27), low masculinity (Index = 31), very high uncertainty avoidance (Index = 99), low long-term orientation (Index = 28), and low indulgence (Index = 33) (Motoki et al., 2022). Chinese culture demonstrates a very high-power distance (Index = 80), very low individualism (Index = 20), high masculinity (Index = 66), low uncertainty avoidance (Index = 30), very high long-term orientation (Index = 87), and low indulgence (Index = 24) (Kwon, 2012). It will help to explain the hypothesis as well. Figure 1 visually represents the differences in Hofstede’s cultural dimensions index between China and Portugal (Hofstede, 2024).

Figure 1. Hofstede cultural dimensions index.

Social influence

Societal factors influencing luxury consumption align with the self-determination theory (Schade et al., 2016), which proposes that social influence and brand image (Chu et al., 2021) drive luxury consumption tendencies. The compensatory control theory (Landau et al., 2015) suggests that luxury consumption leads to the urge to purchase luxury items, luxury spending, and life satisfaction. Individuals experiencing anxiety due to perceived unpredictability and disorder in their lives may seek beliefs emphasizing personal, social, or religious control. Social and political ideologies offering a sense of control can attract those desiring a predictable and organized luxury consumption experience (Taylor, 2012).

Social factors significantly influence long-term changes in customer behavior (Zhang et al., 2020). Social influence is defined as a person’s perception that important individuals believe they should or should not engage in a specific behavior (White et al., 2019; Zhang et al., 2020). Seeking both accurate information and approval from others or reference groups, social influence is a constant presence in consumers’ lives, shaping their consumption choices (White et al., 2019). Belonging to a higher social class may drive individuals to purchase luxury products that align with their status (Ryan & Deci, 2000). Consumers with luxury competencies, displaying expertise, taste, and sensitivity to luxury symbolism, hold credibility and influence. Those with authority derived from luxury competence exert significant social influence, known as “soft influence” (Wang, 2022).

Social norms, identities, and desirability also impact luxury consumption. Different social classes possess distinct norms, identities, and desirabilities, exerting social influence and shaping behavior within their respective groups (White et al., 2019). The visibility of purchasing actions further amplifies the influence of social norms (Zhan & He, 2012). As purchasing behavior reflects self-expression and social status display (Griskevicius et al., 2010), individuals strive to choose brands that align with the expectations and norms of their desired social groups. The tend and befriend theory suggests that luxury consumption enhances social acceptability and integration with desired social groups (Schade et al., 2016). In such cases, consumers prefer widely recognized and approved brands, such as luxury brands, as they aim to present themselves favorably (Zhan & He, 2012). Consumers perceive luxury products that offer socially visible benefits, such as attractiveness and brand reputation, as more important than normal products that provide private benefits like durability and taste. Social influence positively impacts luxury consumption tendencies (White & Simpson, 2013; Zhan & He, 2012). Besides, the influence may present great different based on culture difference. The degree of power distance and low individualism may amplify the social influence on luxury consumption tendency.

H1: Social influence has a positive influence on the luxury consumption tendency.

Conspicuous consumption

Conspicuous consumption, the act of purchasing and displaying expensive goods to create a social impression, serves as a signaling behavior to impress others through possessions and behaviors (Lee & Shrum, 2012). Bellezza et al. (2014) defines it as utilizing various signals, including status display, power demonstration, exclusive access, and activities, to establish a social image. Conspicuous consumption encompasses flamboyant and costly behaviors that communicate clear messages through the acquisition and utilization of possessions and actions (Goenka & Thomas, 2019). Luxury consumption can be categorized into conspicuous and inconspicuous luxury consumption (Shao et al., 2019). Some scholars argue that conspicuous consumption promotes emotional value and symbolic meaning (Tynan et al., 2010), while others consider it unethical (Han et al., 2010). Sociologists have labeled conspicuous consumption as immoral behavior (Shao et al., 2019).

According to the tend and befriend theory, conspicuous consumption encourages individuals to purchase more luxury items to fulfill their vanity and fit into a higher social class (Dogan et al., 2020). Consequently, luxury products become the easiest means of satisfying consumers’ conspicuous needs. Many recent studies on luxury consumption also utilize the concept of conspicuous consumption to explain consumer behavior (Truong & McColl, 2011). Therefore:

H2: Conspicuous consumption has a positive influence on the luxury consumption tendency

Brand image

Branding is a process that involves specific behaviors in disseminating, consuming, and developing a brand among organizational actors and consumers . Brand image refers to perceptions of a brand represented by associations stored in memory (Keller, 1993). Strong brands aim to establish a competitive position that reinforces consumers’ image (Chu et al., 2021). Lin et al. (2021) states that strong brands are essential as they convey consumer behaviors and demonstrate a company’s understanding of its target market. By intentionally managing identity, brands become vehicles for attracting attention and prestige. Elements such as logo, name, organizational culture, product and service offerings, advertisements, and corporate headquarters appearance shape a company’s corporate image (Lin et al., 2021).

Research by Husic and Cicic (2009) highlights the crucial role of brand image in customers’ purchasing decisions for luxury goods. Brand image can influence individuals’ perceptions of their own image, social status, and social recognition (Chu et al., 2021). There is a tendency toward isomorphic behavior, where individuals emulate the brand image to transfer it to their personal image (Iglesias et al., 2019). Luxury clothing, watches, and cars are often associated with the image of successful businessmen, portraying success through external conditions (Chu et al., 2021). Many customers purchase luxury products to emulate these success images, which are seen as having celebrity charm (Hackley & Hackley, 2015). Previous research has consistently demonstrated the importance of brand image in influencing consumers’ propensity to purchase luxury goods (Chu et al., 2021). Therefore:

H3: Brand image has a positive influence on luxury consumption tendency

Life satisfaction

Life satisfaction is a cognitive evaluation of overall life, based on personal preferences rather than external circumstances . It is a long-term trait factor that reflects a comprehensive evaluation of our lives, distinguishing it from short-term emotional reactions (Hill et al., 2012). Brand image has been found to play a significant role in consumer purchasing decisions for luxury goods (Husic & Cicic, 2009). Life satisfaction, a key aspect of well-being and happiness, has positive outcomes in various domains, including personal, psychological, behavioral, social, interpersonal, and intrapersonal factors (Hill et al., 2012). Therefore, to research how luxury consumption tendency will influence consumer long-term life satisfaction rather than one luxury purchase behavior is necessary.

Research indicates that individuals placing high importance on materialistic goods tend to have poorer interpersonal relationships, which can negatively affect life satisfaction (Richins & Dawson, 1992). Consumption has a significant impact on emotional and physical well-being. For individuals leading a better lifestyle, purchasing luxury items may enhance overall happiness (Wiedmann et al., 2009). The concept of “expensive happiness” supports the relationship between luxury consumption tendency and life satisfaction (Wang et al., 2022). This exemplifies the phenomenon known as “Luxury Consumption Behavior” (Wang et al., 2022). The link between the desire for luxury and overall happiness becomes stronger when the need for uniqueness through luxury purchases is fulfilled (Wang & Tong, 2017; Wang et al., 2022). The compensatory control theory explains how luxury consumption can fulfill needs related to a lack of power and personal control (Landau et al., 2015). The consumption or possession of luxury goods can influence and improve consumer life satisfaction in the presence of a luxury consumption tendency (Wang & Tong, 2017). Furthermore, this influence will be amplified by long-term orientation. This means luxury consumption tendency may improve Chinese life satisfaction rather than Portuguese. The inclination to consume luxury goods has an impact on life satisfaction as it can become a basic need waiting to be fulfilled (Wang et al., 2022). Therefore:

H4: Luxury consumption tendency has a positive influence on life satisfaction

Urge to buy

The urge to buy refers to a strong desire and impulsive behavior to acquire something immediately (Chen et al., 2019). Previously, studies primarily focused on impulsive buying, neglecting the concept of the urge to buy (Huang, 2016). Impulsive buying is a response to social stress, driven solely by the act of buying itself. Given its strength and persistence, the urge to buy triggers emotional, cognitive, and behavioral reactions that can lead to repetitive impulsive buying. Some scholars suggest that the urge to buy may be associated with hedonic consumption tendencies, driven by immediate desires and pleasure (Carroll & Ahuvia, 2006).

Several researchers have examined the role of the urge to buy in luxury and fashion consumption behaviors . Previous research indicates that the inclination toward luxury consumption can influence the urge to purchase (Chatzidakis, 2015; Hagtvedt & Patrick, 2016). However, to research the luxury consumption tendency is not only focus on one or two times of urgent to purchase luxury products, but also focusing on how the urge to buy will be impacted by luxury consumption tednecy. According to the compensatory control theory, individuals may turn to luxury consumption as an external source of control when they perceive a lack of personal agency, leading to an increase in the urge to buy (Mainolfi, 2020). This inclination can alleviate feelings of guilt (Chatzidakis, 2015) and facilitate impulsive buying decisions. The urge to buy may be driven by hedonic motivations (Carroll & Ahuvia, 2006), and luxury consumption can serve as a means to satisfy rather than suppress these desires (Hagtvedt & Patrick, 2016). However, urge to buy will lead uncertainty (Dameyasani & Abraham, 2013). Due to the fact that Chinese culture present very high level of uncertainty avoidance, luxury consumption tendency may not influence urge to buy effectiveness in China.

H5: The luxury consumption tendency has a positive influence on the urge to buy.

Luxury spending

Luxury spending refers to the desire to engage in exchange relationships with a luxury store, involving activities such as providing business information, maintaining contacts, and completing commercial transactions (Ma et al., 2019). It is synonymous with the intention to acquire or transact a luxury product (Ma et al., 2019). The Technology Acceptance Model (TAM) is a widely recognized and effective theory for predicting an individual’s intention to buy (Pavlou, 2003). The Technology Acceptance Model (TAM), introduced by Davis and Venkatesh (1996), has emerged as a predominant framework for examining the factors influencing users’ acceptance of technology. TAM posits the mediating influence of two variables, perceived ease of use and perceived usefulness, in the intricate relationship between luxury spending and luxury consumption tendency. Luxury spending may manifest even if customers ultimately opt not to make a purchase, encapsulating intentions throughout the decision-making process. Despite intentions spanning the decision-making process, actual actions frequently encounter barriers (Pavlou, 2003).

Previous research suggests that luxury brand consumption is positively related to the intention to buy (Mainolfi, 2020). A stronger luxury consumption tendency leads to increased luxury spending (Mainolfi, 2020), overcoming hesitations and guilt feelings (Ki et al., 2017) and driving decision-making. Thus, the luxury consumption tendency is expected to have a positive impact on luxury spending, which is particularly relevant as it closely reflects or predicts luxury sales (Mainolfi, 2020).

H6: The luxury consumption tendency has a positive influence on luxury spending.

Method

The main research question focuses on the luxury consumption tendency and its effects, and a comparison will be made between the Chinese and Portuguese luxury markets. Figure 2 depicts the research model with the hypotheses.

Figure 2. Investigation model.

Structural Equation Model (SEM) is particularly suitable for analyzing complex models that involve latent, non-observable variables and simultaneous regressions. Latent variables are constructs that cannot be directly observed but are inferred from observed indicators. SEM allows researchers to model the relationships among latent variables and observed variables simultaneously, providing a comprehensive understanding of complex theoretical frameworks. Additionally, SEM facilitates the examination of multiple relationships and pathways within a single analytical framework, allowing for the assessment of both direct and indirect effects. This approach offers a more nuanced and holistic understanding of the underlying mechanisms and processes governing the relationships among variables in complex models. Therefore, SEM serves as a powerful tool for investigating intricate relationships and testing theoretical hypotheses in various fields of research.

Sample and data collection

A self-administered questionnaire was utilized to assess the proposed research model and test the hypotheses. Data collection took place on the main streets of three cities (Lisbon, Porto and Coimbra; Beijing, Guangzhou and Tianjin), where individuals were approached and requested to participate in the questionnaire. We ask respondents to think on their luxury shopping, based on what they think luxury might be, and ask them to name a luxury brand they appreciate and could buy. To streamline the data collection process, respondents were asked to complete the questionnaire on-site once they finished answering the questions.

To avoid common method bias, we ensured clarity and unambiguous language by translating the questionnaire into standard Chinese and Portuguese. Furthermore, the pretest did not reveal any issues with questionnaire comprehension. Additionally, we utilized balanced scales; firstly, all scales underwent testing in prior research, and secondly, we incorporated an equal number of positive and negative response options to mitigate acquiescence bias or extreme responding. Finally, we omitted the names of each scale in the questionnaire and randomize the order of questions to minimize order effects and reduce the likelihood of respondents developing a pattern of responses. We ask respondents to think on their luxury shopping, based on what they think luxury might be, and ask them to name a luxury brand they appreciate and could buy.

Data collection occurred from February to May, 2020. During this period, both China and Portugal were grappling with the challenges posed by the COVID-19 pandemic. While the Portuguese government did not immediately implement lockdown regulations, there were already numerous COVID-19 patients in the country. Participants were asked about their luxury purchasing behavior in the previous year and were invited to complete the survey if applicable. The sample of respondents was diverse, encompassing various demographic characteristics such as age, gender, nationality, education level, and occupation, in order to ensure a comprehensive representation of the study population.

Mall-intercept surveys can capture a wide range of demographics, including different age groups, socioeconomic backgrounds, and lifestyles, providing researchers with a more representative sample compared to convenience samples from other locations (Nowell & Stanley, 1991). In-person surveys conducted in a mall setting often result in higher response rates compared to other survey methods, such as telephone or online surveys, as individuals are approached face-to-face and may be more willing to participate (Bush & Hair, 1985). Despite its diversity, the sample obtained from a mall-intercept survey may still suffer from sampling bias, as it may not fully represent the population due to factors such as individuals who frequent malls more often or those who are more sociable being overrepresented (Nowell & Stanley, 1991). However, our sample comes from 3 representative cities in both countries and the rejection rate is neglectable.

Table 2 presents the demographic data from both Chinese and Portuguese databases. Both databases feature a comparable number of male and female respondents, without gender differences. Moreover, our databases comprise over 50% of young consumers aged between 18 and 30 years old. This demographic composition may introduce sample bias on one hand, yet it aligns with current consumption patterns on the other. Young consumers tend to exhibit a heightened desire for uniqueness in self-presentation and experience lower familial stress, factors that are conducive to luxury consumption tendencies (Eastman et al., 2020). Additionally, it’s noteworthy that China and Portugal have distinct pre-higher education systems; hence, we only differentiate respondents based on whether they hold a high educational degree. Chinese respondents report a higher average family income per month compared to their Portuguese counterparts.

Table 2. Sample characterization data of the respondents in Portugal and China.

Category	Portugal	China
Total	401	369
Male	174	183
Female	225	186
Others	2	0
Age
18-30	363	216
31-50	31	121
over 50	7	32
Occupation
Student and unemployed	318	163
Work and retired	208	83
Family Members
1-3	213	227
Over 3	188	142
Highest Education Level
Higher education	136	330
Others	266	265
Income (with different standard)
Less than 500 €	37	0
500€–999€	83	71
1000€–2499€	201	151
More than 2499€	80	147
Extraction Total	7.278	12.964
Sums of Squared %of Variance	25.994	46.236

Measures

Table 3 depicts the outcomes of the multiple group confirmatory factor analysis (CFA) conducted under constrained conditions to examine configural invariance. The analysis yielded a χ² statistic of 1260.157 with 658 degrees of freedom. These findings correspond to a Comparative Fit Index (CFI) of 0.96 and a Root Mean Squared Error of Approximation (RMSEA) of 0.0036. Subsequently, metric invariance was assessed, resulting in a χ² value of 1326.286 with 679 degrees of freedom, a CFI of 0.957, and an RMSEA of 0.037. Notably, the observed delta values for CFI (0.003) and RMSEA (0.001) align with the recommended thresholds (Babin et al., 2016), affirming the adequacy of the model fit. Consequently, the comparison of relationships between groups is deemed valid.

Table 3. Fit indices of SEM model comparisons.

Model	Chi-square	df	CFI	RMSEA	ΔCFI	ΔRMSEA
Nationality
M0(configural)	1260.157	658	0.96	0.036
M1(metric)	1326.286	679	0.957	0.037	0.003	0.001

Validated scales were translated and adapted to measure the perceptions of Portuguese and Chinese customers. All items were adjusted to a seven-point Likert scale ranging from 1 (strongly disagree) to 7 (strongly agree). Table 4 presents the scales and sources of the variables included in the final questionnaire. Additionally, two direct questions regarding luxury spending were included: participants were asked to report their luxury expenditure in the previous year and their anticipated luxury expenditure for the upcoming year.

Table 4. Measurement scales.

Construct	Item	SRW	Source
Luxury Consumption Tendency	I would buy a product just because it is luxury.	0.885	(Pino et al., 2019)
	I am interested in luxury products	0.887
	I would pay more for a product if it is luxury	0.837
	A luxury product is relevant to me	0.858
	A product is more valuable to me if it is luxury	0.78
Social Influence	Would help me to feel acceptable	0.881	(Walsh et al., 2014)
	Would improve the way I am perceived?	0.884
	Would make a good impression on other people.	0.925
	Would give its owner social approval?	0.918
Brand Image	Colorless-Colorful	0.774	(Faircloth et al., 2001)
	Submissive-Dominating	0.893
	Calm-Excitable	0.882
	Modest-Vain	0.896
	Thrifty-Indulgent	0.822
Conspicuous Consumption	I buy luxury because I can gain respect.	0.926	(O’Cass & Frost, 2002)
	I buy luxury because I can get popularity.	0.933
	I buy luxury because of others.	0.88
	I buy luxury to show who I am.	0.902
Life Satisfaction	In most ways my life is close to my ideal.	0.9	(Slocum-Gori et al., 2009)
	The conditions of my life are excellent.	0.786
	I am satisfied with my life.	0.889
	So far, I have gotten the important things I want in life.	0.857
	If I could live my life over, I would change almost nothing.	0.653
Urge to Buy	I experienced a number of sudden urges to buy things.	0.915	(Verhagen & Van Dolen, 2011)
	I saw a number of things I wanted to buy even though they were not on my shopping list.	0.814
	I felt a sudden urge to by something	0.824

Confirmatory factor analysis (CFA) was performed using AMOS 22 to assess the psychometric properties of the scales. Inter-item correlations were examined, followed by CFA to determine the factorial structure of the variables. The results, presented in Table 5, indicate that the data fit the proposed model for both the Chinese and Portuguese samples, meeting the criteria set forth by Hu and Bentler (1999) and Steiger (2007).

Table 5. Global model fit China and Portugal.

	Sample
Index	China	Portugal
X²	2.233	1.945
Df	634.171	552.507
IFI	284	284
TLI	0.962	0.948
CFI	0.956	0.94
RMSEA	0.962	0.948

Standard deviation, composite reliability, correlation, and average variance extracted (AVE) were computed using AMOS 22. The results are summarized in Tables 6 and 7. In Chinese database, most of the alpha values exceed 0.9, except the alpha of urge to buy (0.887). In Portuguese database, the alpha values exceed 0.9. Furthermore, AVE values exceed 0.7, and CR values exceed 0.6. Discriminant validity is established as all correlations between variables are significantly below 1, and the squared correlations for each pair of constructs are consistently smaller than the variance extracted for the respective constructs (Shiu et al., 2011).

Table 6. Standard Deviation, Composited Reliability, Correlation and Average Variance Extracted from Chinese Sample.

	SD	BI	SF	CC	LCT	LS	UTB	LSP	CR	AVE
BI	1.452	0.93							0.931	0.731
SF	1.646	0.451	0.945						0.946	0.814
CC	1.789	0.542	0.888	0.951					0.951	0.829
LCT	1.334	0.502	0.71	0.756	0.928				0.929	0.723
LS	1.4	0.428	0.404	0.441	0.559	0.904			0.911	0.701
UTB	1.517	0.362	0.483	0.492	0.585	0.542	0.887		0.888	0.726
LSP	1.18	0.197	0.277	0.277	0.362	0.225	0.198	0.92	0.923	0.863

Table 7. Standard Deviation, Composited Reliability, Correlation and Average Variance Extracted from Portuguese Sample.

	SD	BI	SF	CC	LCT	LS	UTB	LSP	CR	AVE
BI	1.566	0.817							0.907	0.711
SF	1.688	0.117	0.89						0.894	0.701
CC	1.229	0.1	0.59	0.941					0.944	0.808
LCT	1.504	0.248	0.477	0.493	0.859				0.861	0.703
LS	1.637	0.233	0.011	−0.034	0.097	0.847			0.905	0.705
UTB	1.66	0.165	0.335	0.297	0.451	0.018	0.894		0.896	0.743
LSP	0.822	−0.042	0.135	0.199	0.254	0.104	0.115	0.81	0.823	0.7

To assess the potential for common method variance (CMV), we conducted a Harman’s single-factor test and a common latent factor analysis (Podsakoff et al., 2003). Exploratory factor analysis revealed a multifactor structure with 7.278 and 12.946 eigenvalues greater than 1. No single factor accounts for more than 50% of the explained variance in both Chinese and Portuguese data (Fuller et al., 2016). The first factor explains 25.99% and the second 45.236% of the explained variance. As a result, there is no common method bias and the data is ready for further analysis.

Findings

Comparing the Chinese and Portuguese data

T-tests were conducted to compare the differences between the two samples. As indicated in Table 8, the p-values for social influence, conspicuous consumption, luxury consumption tendency, urge to buy, and luxury spending were all below .005. These results indicate significant differences between the Chinese and Portuguese samples in these items. Meanwhile, it proves that culture different could influence consumer choice and luxury consumption tendency significantly.

Table 8. T-test differences among nationality.

Variable	Portugal	China	p
Social Influence	2.758	3.850	.000
Conspicuous Consumption	1.800	3.540	.000
Luxury Consumption Tendency	2.959	4.295	.000
Brand Image	4.047	4.216	.072
Life Satisfaction	4.327	4.541	.024
Urge to Buy	1.300	1.787	.000
Luxury Spending	2.728	4.573	.000

Cultural backgrounds can influence individuals’ attitudes toward social influence, conspicuous consumption, luxury consumption tendency, urge to buy, and luxury spending (Boonchoo & Thoumrungroje, 2017). In particular, luxury consumption tendency can serve as a means of displaying social status (Mi et al., 2018). The Chinese culture, with its historical power distance between social classes, places significant importance on conspicuous consumption.

On the other hand, cultural differences lead to distinct attitudes toward the urge to buy in China and Portugal. Online shopping is more prevalent in China compared to Portugal (He et al., 2018). The rise of digital marketing has also contributed to differing attitudes and behaviors toward the urge to buy (Sihombing et al., 2020). Digital platforms can directly influence consumer behavior by promoting luxury goods through online advertisements and facilitating online shopping (Huang & Wang, 2018), resulting in a greater impact on the urge to buy in China compared to Portugal.

Despite the greater impact of conspicuous consumption and the urge to buy in China, Portuguese consumers still exhibit higher levels of luxury spending. This unexpected finding contrasts with the unexpected increase in the Chinese luxury market during the COVID-19 pandemic (Javornik et al., 2021), although it can be attributed to Portugal’s higher GDP compared to China.

SEM results

Table 9 shows the results of model fits in both Chinese and Portuguese samples (Hu & Bentler, 1999; Steiger, 2007):

Table 9. Model fit of SEM.

	Sample
Index	China	Portugal
IFI	1.965	1.718
TLI	666.072	582.243
CFI	339	339
RMSEA	0.966	0.955
CMIN/DF	0.962	0.949

Based on the two samples and using SEM, the results of the hypotheses test are shown in Table 10. All the proposed hypotheses received support, except H4 in the Portuguese sample. Furthermore, the coefficients of the Chinese sample tend to be higher, indicating the dynamism of the Chinese luxury market (Mainolfi, 2020).

Table 10. Standardized regression summary.

Hypothesis		China					Portugal
		Estimate	S.E.	C.R.	p	Check	Estimate	S.E.	C.R.	p	Check
H1	SF→LCT	0.206	0.08	2.153	.031	Support	0.28	0.066	4.032	***	Support
H2	CC→LCT	0.497	0.075	4.826	***	Support	0.316	0.068	4.715	***	Support
H3	BI→LCT	0.151	0.052	3.253	.001	Support	0.187	0.059	3.301	***	Support
H4	LCT→LS	0.576	0.05	11.326	***	Support	0.097	0.066	1.564	.118	Not Support
H5	LCT→UTB	0.595	0.06	11.699	***	Support	0.464	0.074	7.515	***	Support
H6	LCT→LSP	0.367	0.049	6.066	***	Support	0.249	0.04	3.281	.001	Support

Discussion

Social influence and luxury consumption tendency

Social influence positively influences the tendency for luxury consumption, providing support for H1. The results for both Chinese (r = 0.08, p < .05) and Portuguese respondents (r = 0.066, p < .001) are consistent.

This finding aligns with the notion that individuals use luxury goods to signal their social status. The desire for status and social influence motivates people to purchase luxury products and engage in luxury consumption (Husic & Cicic, 2009). The self-determination theory (Shao et al., 2019) explains how extrinsic motivations, such as maintaining social status, can be fulfilled through luxury consumption (Ryan & Deci, 2000). Social influence may encourage individuals to acquire unnecessary items, while companies rely on influencers and social issues to reinforce consumers’ social positioning (White et al., 2019; Zhang et al., 2020). Even in cases where indulgence is low, social influence remains a strong driver of luxury consumption (White & Simpson, 2013; Zhan & He, 2012), which could explain the similarity between the two samples.

Conspicuous consumption and the luxury consumption tendency

Conspicuous consumption positively influences the tendency for luxury consumption in both the Chinese sample (r = 0.075, p < .001) and the Portuguese sample (r = 0.068, p < .001), providing support for H2.

However, the influence and impact of conspicuous consumption on the luxury consumption tendency are stronger in China compared to Portugal. This difference could be attributed to the rapid urbanization and the increasing desire for status and social recognition in China (Mi et al., 2018). Conspicuous consumption serves as a significant driver for the luxury consumption tendency and is closely linked to social factors. It involves using possessions and actions to communicate and impress others (Lee & Shrum, 2012), which can enhance self-esteem, the desire for uniqueness (Lee et al., 2021), and reaffirm desired social positioning (Goenka & Thomas, 2019).

Brand image and the luxury consumption tendency

Brand image significantly influences the tendency for luxury consumption, supporting H3. This relationship holds true for both the Chinese sample (r = 0.052, p = .001) and the Portuguese sample (r = 0.059, p < .001). Although the coefficients are similar between the two groups, they are slightly higher in the Chinese sample.

Brand image, fashion, store atmosphere, and status are identified as the main drivers of the luxury consumption tendency (Husic & Cicic, 2009). The level of consumer trust in a brand is associated with the quality of its brand image (Cho & Fiore, 2015). In the luxury market, brand image goes beyond trust and also contributes to the reinforcement of consumers’ self-image and social status (Iglesias et al., 2019). Luxury brands benefit from a higher level of social influence (White et al., 2019), and their association with conspicuous consumption further strengthens their role as key drivers of luxury consumption (White et al., 2019).

Luxury consumption tendency and life satisfaction

The findings of this study support the hypothesis that life satisfaction positively influences the tendency for luxury consumption in Chinese samples. However, in the Portuguese sample, we reject this hypothesis. The impact is significantly higher in the Chinese sample (r = 0.05, p < .001) compared to the Portuguese sample (r = 0.066, p = .118). This is consistent with the research suggests that life satisfaction is often considered a significant life goal and is associated with various factors such as improved health (Diener et al. 1985), stronger social connections and a sense of fulfillment .

However, in Portugal, the tendency toward luxury consumption fails to deliver genuine happiness or life satisfaction to consumers. Due to social influences and conspicuous consumption behaviors, Portuguese consumers adhere to this tendency, resulting in an increase in their cost-of-living standards. Moreover, when compared to the price of luxury products, conspicuous well-being alone does not adequately contribute to overall life satisfaction (Chen et al., 2021). Furthermore, luxury consumption may lead to potential guilty to some of consumers (Ki et al., 2017).

Luxury consumption may be linked to life satisfaction due to its potential to enhance feelings of achievement (Pavot & Diener, 2008), improve health (Hill et al., 2012), elevate social status and recognition (Iglesias et al., 2019; White et al., 2019), and boost self-esteem (Lee et al., 2021). Moreover, high levels of life satisfaction may lead to sustained or increased levels of luxury spending in the future (Wang et al., 2022).

Luxury consumption tendency and the urge to buy

The results support the hypothesis of a positive relationship between luxury consumption tendency and the urge to buy in both the Chinese and Portuguese samples, although the impact is significantly stronger in the Chinese sample (r = 0.06, p < .001) compared to the Portuguese sample (r = 0.074, p < .001).

The urge to buy refers to a strong desire to immediately acquire something, similar to impulse buying but without subsequent feelings of guilt (Rook, 1987). Luxury consumption tendency may enhance social recognition, self-esteem, and life satisfaction, which can subsequently increase the desire to acquire luxury goods (Georgia, 2019; Balabanis and Stathopoulou, 2021). Luxury brands can effectively leverage this tendency by emphasizing the pleasure and achievement aspects of luxury consumption and focusing on the hedonic aspects of consumption (Carroll & Ahuvia, 2006) as part of their marketing strategy to stimulate the urge to buy and promote their products.

Luxury consumption tendency and luxury spending

Our results support the hypothesis of a positive relationship between luxury consumption tendency and future luxury spending in both the Chinese (r = 0.049, p < .001) and Portuguese (r = 0.04, p < .001) samples, with a slightly stronger impact on the Chinese sample.

Participants were asked to report their luxury spending in the previous year and their plans for luxury spending in the upcoming year. When luxury consumption tendency increases, individuals are more inclined to allocate more money toward luxury products and services, driven by the desire to enhance life satisfaction, elevate social status and recognition, and fulfill psychological needs such as self-esteem (Mainolfi, 2020). This suggests that a high luxury consumption tendency is associated with a strong urge to buy (Balabanis, 2021), resulting in actual expenditures rather than mere intentions or expectations (Mainolfi, 2020). This finding is particularly significant as it aligns closely with real spending behavior rather than just intentions or expectations (Ki et al., 2017).

Comparing Chinese and Portuguese consumers

The results indicate significant differences between the Chinese and Portuguese samples regarding the variables examined in hypotheses 2, 4, 5, and 6. To gain a better understanding of these dif­ferences, we employed Hofstede’s Dimensions (Hofstede, 2011) to compare the two samples.

The Chinese sample demonstrates more characteristics associated with a masculine society, whereas the Portuguese sample leans toward a more feminine society. This divergence may result in Chinese society prioritizing self-assuredness over the enhancement of everyday life quality (Pan et al., 2022). Consequently, conspicuous consumption exerts a greater influence on luxury consumption tendency in China, while the impact of luxury consumption tendency on life satisfaction is stronger. Chinese consumers tend to value brand image and opulence, while Portuguese consumers prioritize environmentally-friendly values.

Moreover, Chinese consumers exhibit a long-term orientation, while Portuguese consumers tend to focus on short-term benefits (Duarte & Silva, 2020). This disparity may account for the variations in the relationship between luxury consumption tendency and life satisfaction. Chinese consumers may derive higher levels of life satisfaction over the long run through the consumption and possession of luxury goods (Wang et al., 2021). The Chinese luxury market, which has experienced rapid growth, exemplifies the traits of a "late arrival" market.

Contributions, implications and recommendations

Theoretical implications

In academic, this study contributes to the field of luxury consumption tendency research in three significant ways. Firstly, it adopts a multi-factor approach to investigate the luxury consumption tendency, which is an important contribution. Previous research predominantly focused on measuring consumer perceptions of luxury brands (Sung et al., 2015; Shukla, 2011), conceptualizing the concept of luxury (Hung et al., 2020), and examining the reasons and impacts of luxury goods purchases (Kastanakis & Balabanis, 2014; Leban et al., 2020). This study stands in a general viewpoint and do not use any specific luxury brand which may cause cognition. Furthermore, this study extends the existing literature by proposing that luxury consumption is not merely a singular consumer behavior but rather a tendency that evolves over time, influencing consumer attitudes and behaviors. The luxury consumption tendency is examined from the consumer’s perspective, considering the influence of social factors, conspicuous consumption, and brand image.

Secondly, this study explores the luxury consumption tendency in two culturally distinct countries: China and Portugal. The inclusion of samples from these countries provides evidence that social factors, conspicuous consumption, and brand image contribute to the luxury consumption tendency, thereby enhancing the validity and reliability of the theoretical framework and measurement. Meanwhile, this research established the understanding between luxury consumption tendency and culture differences with reliable evidence and tests.

Lastly, this study contributes to the advancement of theoretical understanding by operationalizing relevant concepts related to individual variations in luxury consumption behavior. By testing theoretical hypotheses that explain why individuals engage in luxury consumption, this study explores the relationship between luxury consumption tendency, social factors, conspicuous consumption, and brand image. The tend and befriend theory (Taylor, 2012) suggests that individuals may turn to luxury consumption during vulnerable times as a means of gaining social acceptance and security (Wang et al., 2012). This hypothesis implies that differences in the inclination for luxury consumption may stem from variations in levels of social isolation. In contrast, the compensating control theory (Kay et al., 2009) proposes that the desire for luxury spending may arise from a lack of personal control and unfulfilled power needs. This study presents a novel model that can potentially predict consumer behavior related to living standards and enhance understanding of actual expenditures on luxury goods.

Managerial implications

Our findings have significant implications for luxury brands. Firstly, luxury consumption is not simply a form of consumer behavior, but also a tendency that develops over time, influencing consumers’ attitudes and behaviors. This novel perspective can aid luxury brands in gaining a deeper understanding of their target consumers, the process of luxury consumption, and the driving factors behind the desire to consume luxury goods. Secondly, this research provides insight into how to follow the luxury consumption tendency. Our results highlight the importance of social influence, conspicuous consumption, and brand image as drivers of the luxury consumption tendency. By addressing these factors, luxury brands can maximize the influence of the luxury consumption tendency on their customers.

Thirdly, this research offers insights into how luxury brands can navigate challenges during the pandemic and war crisis era. By understanding the factors that drive luxury consumption, brands can design strategies that avoid stagnant luxury markets. Our findings, based on two different cultural samples, can be applied in various contexts, providing relevant results.

Limitation and recommendation for future research

It is important to acknowledge the limitations of this study. One limitation is the use of cross-sectional data, which prevents us from establishing causal relationships between life satisfaction and luxury consumption tendency. Longitudinal data would provide a more comprehensive analysis of the causal dynamics over time. Additionally, while this study includes relevant cultural data for comparing luxury consumption in different countries, further cross-cultural validation with a wider range of cultures would enhance the generalizability of the findings. Another limitation is the possibility of translation-related issues, as the measurement scales were translated from English to Chinese and Portuguese. However, we conducted a pretest of the final instrument before data collection, which demonstrated a high level of stability. Additionally, it is important to acknowledge the limitation of sample bias, as the respondents are excessively concentrated in very young age groups, and data collection is restricted to three cities in each country.

This study also opens up opportunities for future research. For instance, longitudinal data would allow for a more in-depth understanding of the process of luxury consumption and its relationship with life satisfaction over time. Additionally, considering the influence of value-behavior bias on consumption behavior (Henninger et al., 2016; West et al., 2021) could provide valuable insights. Future research should also explore consumers’ perceptions of luxury, as individuals may have different conceptions of what constitutes a luxury product (Ko et al., 2019), moving beyond solely examining their behavioral choices. Furthermore, the impacts of slow consumption and sustainability concerns are important to consider, as they may influence consumers’ preferences for luxury products.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

The research was supported by Centro Científico e Cultural de Macau (CCCM) and Fundação para a Ciência e a Tecnologia (FCT) [PRT/BD/153371/2021].

Notes on contributors

Marco Haozhe Ma

Haozhe Ma is a Ph.D. Candidate in Business Management in the School of Economics (FEUC) from the University of Coimbra. He holds a Master’s degree from the School of Economics (FEUC)—University of Coimbra (Portugal) and a Bachelor’s degree from the School of business—Macao Polytechnic University (China). Currently, he works on the research on sustainable consumption and consumer psychological characteristics.

Arnaldo Coelho

Arnaldo Coelho holds a Master’s degree from the Institute of Business Administration at the University of Poitiers and a PhD in Business Administration from the University of Barcelona. He is a professor at the Faculty of Economics of the University of Coimbra since 1987 and coordinates the Marketing programs of this Faculty. He also acts as a consultant in the areas of Organization, Strategy and Marketing and develops work in the area of Corporate Social Responsibility, Entrepreneurship, Human Behavior in the Organization (workplace spirituality, authentic leadership, …), Branding and customer behavior.