Posted on 12/11/2004 1:51:03 PM PST by wagglebee
As the silver-lined elevator at Bergdorf Goodman lifted the woman with the carefully manicured hair to the couture level on Thursday afternoon, she spoke into her cellphone: "I've finished shopping - almost," she said, looking down at her bags. "No, not a van. I think a Town Car will be quite big enough, thank you."
On East 57th Street, two young Englishwomen were bustling along the crowded sidewalk, carrying Burberry bags. Debbie Drake, 20, a personal assistant at a British Ford plant, said she had never defined herself as a luxury shopper - until she came to New York. With the dollar weak against the British pound, the $200 for three Burberry T-shirts for her brother for Christmas, and $30 for a plaid hair "bubble" to go around her ponytail were exceptional bargains. "It would have been triple in London," she said.
The luxury market, which, only a few years ago, was struggling, has come back with a bang for the holidays. "Right now, luxury is the only game in town," said Dana Telsey, a retail analyst with Bear, Stearns, who tracks the performance of high-end merchandise.
With the weaker dollar, tourists from Paris, London and Tokyo have descended upon the United States market for their holiday gift shopping, retail executives say. And even many Americans in the market for gifts with an elegant label seem unfazed at the higher prices they have to pay, merchants say.
Robert H. Frank, the author of "Luxury Fever" and an economics professor at Cornell University, talked about the cascade of influence from high-income luxury shoppers "down to people like us." And this Christmas, Americans he surveyed about their choices, no matter what their incomes are, said they wanted to buy "special" gifts for Christmas. Luxury is no longer a matter of price if it is a $1,000 handbag or a $200 jar of face cream or a $50 dog collar with the right brand stamped on it. For some, it just must be the most expensive thing of its type - witness the $30 hair scrunchie.
This holiday season, shoppers and merchants say, it has become ever more apparent: the face - and faces - of luxury are changing in the United States.
As traditional department stores like Lord & Taylor and Macy's struggle to push sales slightly ahead of last year's holiday season, merchants like Bergdorf Goodman and Neiman Marcus, along with brands like Gucci, Louis Vuitton and Chanel, are prospering. A few months ago, it was a case of extremes: Wal-Mart on one end of the yardstick of success, Neiman on the other.
Since Thanksgiving, however, Wal-Mart's shoppers, stung by high gasoline prices, failed to buy as much as expected, and analysts started worrying about the future of the mass-marketers. Only Target, with its status tea kettles and cheap designer fashions, has lived up to expectations - but only just.
At Bergdorf's, meanwhile, sales climbed 15 percent for the three months ended in October, and executives said, are strong in the current quarter. Sales at Neiman Marcus were up 8.3 percent in November. Nordstrom's, a midpriced department store that has successfully managed to label itself a luxury emporium, has also done well. Six months ago, analysts were worrying about the luxury sector, but those fears seem to have subsided for now. "Tell me where the stock market will be in a year," said one, "and I'll tell you whether luxury is vulnerable."
Two years ago, even the wealthy were not in the mood to buy. Now, high-end designers say, customers queue for one-of-a-kind embroidered jeans for $400. Also standing in line are shoppers who, five years ago, might never have walked through Tiffany's stainless steel doors.
At its Manhattan flagship store on Fifth Avenue, Myron Miller, 60, a retired photographer, bought a Tiffany silver key chain with a frog on it as a holiday gift for his wife - for $258. "Not that the key rings from Tiffany's are any better," he said, bringing smiles to the luxury marketers' hearts, "but a gift from Tiffany's just makes people feel good."
Jewelry items, especially $40,000 watches and bracelets with emeralds and sapphires, are soaring this holiday season, as are furs. Dennis Basso, a furrier based in New York, seemed surprised that, so far this season, a dozen customers have clamored to buy his Russian broadtail coats with beaded and feathered hems, for $55,000. And the weather has been warm.
Gucci has bounced back as its operating profit rose $221 million from February through July 2004 over the same period in 2003.
Barneys New York, which specializes in selling designer names like Armani and Balenciaga, has also turned around. And if anything, Barneys' buyers underestimated the demand for certain items. The other day, the Madison Avenue store was sold out of $225 cashmere-lined leather gloves - except for size 7½.
Last Thursday, Allison Lester, an executive with Citigroup in Knoxville, Tenn., bought a pair of $165 sunglasses - and a fur coat at Macy's. "I'm rarely extravagant," she said, "but the coats were on sale at a good time."
Around the holidays, some people come to New York just to shop for luxuries for presents and for themselves. While Manhattan has streets of high-end boutiques, "we have Mall of America," grumbled Tracy Cronin, 29, a leasing agent from Minneapolis. She just bought a $415 plaid handbag. "I view it as a treat for myself," she said.
The demand for fripperies, from $165 sunglasses to $24,000 sable scarves, seems to surprise even their makers. Richard Lambertson, a partner in Lambertson Truex leather goods, spent three hours last Thursday chatting with customers in the Neiman Marcus in Boca Raton, Fla. From 1 to 4 in the afternoon, he sold 25 handbags, seven made of alligator, starting at $2,500.
Vivian Van Natta, the vice president of Chado Ralph Rucci, a Seventh Avenue fashion house, said that trunk show clients in Palo Alto, Calif., were arriving "in their yoga clothes, and they buy duchess satin infanta gowns" for close to $30,000.
In Chicago last week, Wright, a five-year-old auction house that specializes in 20th century decorative arts, held its first "Branded Luxury" sale, featuring Hermès handbags, gold cigarette boxes, E. Goyard steamer trunks and Vuitton valises, all made from 1900 to 1970. The auction, said the owner Richard Wright, brought in more than $500,000.
Estimates of the world's luxury market range from $90 billion to $200 billion, but retail analysts agree that the United States has about a 20 percent share. In America, the luxury market is growing 4 percent to 6 percent, according Marshal Cohen of the NPD Group, a researcher, who pegged the United States market at $42 billion, excluding food and cars.
This rise comes at a time when the rest of the retail environment is stagnant, or in certain sectors, losing ground. "The luxury business is rising faster than the general economy and faster than the apparel business," said Richard E. Jaffe, a retail analyst with Legg Mason.
Luxury is growing, he and other analysts said, in part because the baby boomers are beginning to inherit money - and boomers have demanding taste. "It's the pervasiveness of the brands," he said.
Daniel LaLonde, the chief executive for watches and jewelry in North America for LVMH, the world's biggest luxury conglomerate, said business is booming in the United States. Still, Mr. LaLonde said luxury watches - those that cost more than $500 - make up only 10 percent of the total watches sold in America; in Europe, it is twice that percentage. At the same time, sales of Tag Heuer watches, one of the company's brands, is up 40 percent here.
While the gray-haired woman in the elevator at Bergdorf's can be said to represent the traditional wealthy shopper, less-affluent, often younger shoppers, are on the prowl for brands like Coach, Burberry and Cole Hahn.
Just five years ago, Coach, identified with the kind of heavy leather shoulder bags, and Burberry, with its trademark trench coats lined with plaid, were both moribund brands. But under the leadership of Lew Frankfort at Coach, and Rose Marie Bravo at Burberry, both brands have become what the marketers call "accessible luxury."
Instead of the $3,000 paid for a Louis Vuitton handbag, or the $9,000 for a Hermès Birkin bag, shoppers are seeking a $368 Coach bag, or a $195 Pucci print hat.
This concept, of accessible, or affordable luxury is driving the high-end market now, analysts say.
Tory Burch, a New York society figure, has just introduced her own line of clothes, which have been bought by Bergdorf's, Neiman's, Saks Fifth Avenue and other retailers, she said. But she did not choose to sell her collection at designer prices - she chose a "sweet spot" from $175 to $600 for the bulk of her collections. "My friends don't consider themselves luxury shoppers," she said this week, "although they like a lot of luxury brands. They have a lot less loyalty to one designer. They like mixing price points and designers."
Sometimes, Mr. Frank said, merchants deliberately advertise something that is so expensive they don't sell any - and don't plan to. One example may be the his-and-hers robots Neiman Marcus featured last Christmas, luxuries with price tags of $450,000 apiece. They didn't sell any - but the robots got a lot of publicity, and shoppers then must have thought a $125 box of candy was a bargain.
"They did the same thing at Victoria's Secret," Mr. Frank said. "One year they had Claudia Schiffer with a $1 million diamond-encrusted brassiere," he said. "A guy might have said: 'Isn't that ridiculous!' But that made the holiday special, the $150 bra, seem prudent."
So this Christmas, shoppers who can't afford the $4,860 leather Pucci print suit, may fancy instead the $195 Pucci printed hat.
I gave up "Xmas" years ago and rejoice Christmas. I am not a humbug. Rather, I know the true value of the day, and so do all who choose to spend it with my wife and I. There is no "Xmas Shopping" here...just fellowship with like minded people, who know the difference between "Xmas" and Christmas.
FMCDH(BITS)
"...carefully manicured hair...."
WTF!?!
It's the New York Slimes, what do you expect?
Could have been worse, she might have had "flawlessly pedicured teeth."
"...carefully manicured hair...." WTF!?!
Don't be such a philistine and an ignoramus: it must be the latest fashion, and that woman surely is a high society trendsetter. It's strange you were not able to recognize it immediately.
That's been going on for ages, women have been shopping at BG and other stores, buying the pricey items and then returning them within the week. Sometime just after the last ice age, women in NYC disovered that if you put masking tape on the bottom of shoes -- carefully trimming around the side -- you can wear the shoes once, remove the tape and return them as unworn.
I wouldn't call BG trensetting. Nobody under 60 shops there...BG bonus trivia: It was Veronica Lake's last career stop...as a sales girl. (Not that anyone knows who Veronica Lake is, anymore).
Not that anyone knows who Veronica Lake is, anymore
My father fell in love with my mother in Tuscany in 1945 becasue she looked just like Veronica Lake.
Veronica Lake was a looker. She had that hair thing going on...there is a rock band where the female lead looks like Veronica, though can't remember the name.
She was attractive and so was my mother.
I wish I could remember the name of that rock band. The video has the lead female vocalist killing off the other members of the band in a variety of B-movie scenarios.
I do . . . I used to be a huge classic film fan, not so much anymore, but enough. That woman had the most gorgeous hairstyle in Hollywood history . . . more than made up for her plain-pretty face and for-the-most-part unimpressive acting.
I just remembered the name of the rock band -- No Doubt.
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