Income Inequality and Its Impact on Brand Preference Shifts

Abstract

Income inequality has become an increasingly critical socio-economic issue that influences consumer behaviour globally. This research explores how widening income disparities reshape brand preferences across luxury, mid-range, and value-based categories. Using theoretical frameworks from behavioural economics, social comparison theory, and consumer psychology, the study highlights three major shifts: (1) polarization between luxury and budget brands, (2) the decline of mid-tier brands, and (3) the rise of experiential, ethical, and purpose-driven consumption among socio-economically sensitive consumers. The findings demonstrate that income inequality reshapes perceptions of value, aspiration, brand loyalty, and purchasing motivations. The paper concludes with strategic implications for marketers and directions for future research.