http://www.bloomberg.com/news/2011-08-12/luxury-retail-at-risk-as-stock-market-drop-rattles-u-s-shoppers.html?cmpid=
‘Totally Discretionary’
“Luxury goods are totally discretionary and nobody needs any of it, so it’s the easiest thing to cut back on,” said Pam Danziger, president of Unity Marketing in Stevens, Pennsylvania.
The recent stock-market turmoil will have a “direct impact” on future spending patterns because these consumers are already in a tenuous place, she said. As the value of their homes and investment portfolios rose before the 18-month recession that began in December 2007, high-income consumers were spending their perceived wealth rather than their real income, according to Danziger.
Even amid the economic and political uncertainty of the past several months, high-end department retailers reported strong sales. Same-store comparable sales increased 15.5 percent for the three-month period through July 30 for Saks, the biggest increase in at least four years, the company said Aug. 4. Same-store sales at Neiman Marcus and Nordstrom rose 11 percent and 7.3 percent, respectively, in the same period.
‘Totally Discretionary’
“Luxury goods are totally discretionary and nobody needs any of it, so it’s the easiest thing to cut back on,” said Pam Danziger, president of Unity Marketing in Stevens, Pennsylvania.
The recent stock-market turmoil will have a “direct impact” on future spending patterns because these consumers are already in a tenuous place, she said. As the value of their homes and investment portfolios rose before the 18-month recession that began in December 2007, high-income consumers were spending their perceived wealth rather than their real income, according to Danziger.
Even amid the economic and political uncertainty of the past several months, high-end department retailers reported strong sales. Same-store comparable sales increased 15.5 percent for the three-month period through July 30 for Saks, the biggest increase in at least four years, the company said Aug. 4. Same-store sales at Neiman Marcus and Nordstrom rose 11 percent and 7.3 percent, respectively, in the same period.
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