One of the key takeaways from the Commerce Department's
report for May was that the luxury market was exempt from the woes that beset department stores.
Estimated monthly sales at non-luxury department stores dropped 0.6% from a year earlier. Compare that to Neiman Marcus, which saw same-store sales jump 7.8% as part of an 8.8% overall improvement from last year. Nordstrom also improved same-store (3.7%) and overall sales (7.8%) while Saks' stores (5.8%) and brand (6.9%) experienced similar sales growth last month.
What do they have that their lead-weight competitors lack? Customers who make $90,000 or more a year, whose spending rose 33% from the month before and May 2009 to $145 per day, according to a
Granted, the same poll shows an overall spending increase of 14% last month, which clearly didn't trickle down to the middle- and lower-income spenders who Gallup says spent $59 a day, as they did a year before. However, it lends credence to the argument that there is a bit of frugality fatigue among luxury spenders.
2010 Survey of Affluence and Wealth in America -- which received input from 1,910 respondents with income among the top 10% of all Americans and a mean income of $520,000 a year -- the number of affluent and wealthy U.S. households grew (from 10.6 million to 11 million) this year for the first time since 2007.
Meanwhile, fewer luxury spenders are feeling guilty about their purchases (45% this year from 54% in 2009) or about being seen as wealthy (30% from 42%). American Express and the Harrison Group estimate that this will bring an extra $28 billion into the luxury market this year, an increase of 7% from 2009.
In the first three months of 2010 alone, according to American Express Travel Insights research, luxury spending increased more than 20% after falling 20% for all of last year. While that's making luxury retailers happy, it's also making their consumers more jovial as well, with 70% rating themselves as "very happy," compared with 40% in 2007.
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Jason Notte is a reporter for TheStreet.com. His writing has appeared in The New York Times, The Huffington Post, Esquire.com, Time Out New York, The Boston Herald, The Boston Phoenix, Metro newspaper and the Colorado Springs Independent.