The summer is behind us. The good news is our government avoided default. The bad news is the stock market continues its rollercoaster ride. Today’s query: Are we still in an economic funk? Evidently not for the privileged affluent.
High end shoppers are spending again. The luxury category has posted 10 consecutive months of sales increases versus a year ago. Analysts indicate that the rich are not spending at the same level as they were before the recession, but close. This group could lead our economic recovery – the top five percent of income earners account for close to one-third spending, the top twenty close to sixty percent of spending. July was an exceptionally good month for luxury spending, consequently exhibiting the largest gain in a year, +11.6%. It helped that Mercedes-Benz reported they sold more cars in the U.S. in the month than it had in any previous July in five years.
What is driving luxury sales? The leader of one luxury retailer labeled it the “snob factor.” Higher prices are considered a mark of quality. SpendingPulse also reported recently that there has been a significant decline in the number of promotions in the luxury sector. People are paying full price again versus at the peak of the recession. Luxury consumers also are willing to pay for something that exhibits individualism, one-of-a-kind and rare.
So what vogue items are the privileged affluent buying besides a new S-Class Mercedes-Benz sedan?
• Christian Louboutin “Bianca” pumps @ $775 a pair. Neiman Marcus reported they sold out almost every size. A bargain given Jimmy Choo is advertising in their back to Autumn/Winter 11 collection Enfield, leopard print pony boots for $1,495.
• How about a Gucci coat selling for approximately $12,000 at Bergdorf Goodman. While you are at Bergdorf Goodman, why not pick up a 16 ounce container of Crème da la Mer (facial cream) for $1,650.
• A Louis Vuitton Nomade leather work bag for your laptop @ $3,825.
• $250 Ermenegildo Zenga ties.
• Top off your shopping spree by stopping at New York’s Wall Street Burger Shop for chef Kevin O’Connell’s 10 ounces of Kobe beef, foie gras, exotic mushrooms, cave-aged Gruyère cheese, with truffle mayonnaise (mixed with some gold flakes) on a brioche bun with a sprinkle of gold on top. $175. Tasty. Priceless.
My last query of the day: Does a dribble of mayonnaise spot a $250 tie any differently than a $10 tie bought on sale at Macy’s?