Shoppers are cooling on luxury purchases, Saks Fifth Avenue says

SHOPPERS are cooling on luxury purchases, a survey by Saks Fifth Avenue has found.

Sixty-two per cent of respondents to the survey said they are planning to spend the same or more on luxury goods, compared with the previous three months. That’s down from 68 per cent in September. 

“While there is still an interest and an engagement from the consumer, they’re certainly less bullish than they were in September,” Marc Metrick, chief executive officer of Saks Fifth Avenue’s online operations, said in an interview.

Shoppers who earn US$100,000 to US$199,000 are more cautious than other cohorts. By age, millennials were the most bullish: Sixty-four per cent said they plan to spend the same or more on luxury items in the next several months. Metrick attributes that difference to the fact that many of those 27-to-42-year-old millennials have not lived through a major downturn, while older generations are likely to be more cautious because of their experience during the 2008 financial crisis, for example. 

After luxury sales boomed during the pandemic, this year is likely to be a “much more challenging environment”, Metrick said. Saks, for example, is being “a lot more deliberate” with purchasing inventory, he added. 

Saks’s survey is based on 2,832 US-based respondents over 18 years old and was conducted from Jan 13 to 17. BLOOMBERG