The latest Saks Luxury Pulse has been released and among its key takeaways — the luxury consumer has caught the travel bug and are steering their spending on clothes and accessories related to the journey.
The Saks Luxury Pulse also found that luxury consumers are generally “resilient” and that the majority of respondents to the survey — 62 percent — anticipate spending the same or more on luxury compared to what they spent over the last three months. That’s very good news for Saks and other purveyors of luxury, but it also means a significant percentage is likely to spend less.
Regarding the yearn to travel, 72 percent of those surveyed by Saks.com said they already booked or are planning to book a trip. Of that group, 60 percent said their top spending priority to prepare for the trip is clothing, while 36 percent said their top priority is to spend on shoes for the trip. That’s useful information to be considered in marketing and communications on certain categories, products and brands.
The Saks Luxury Pulse is a quarterly online survey of luxury consumers’ attitudes toward shopping, spending and fashion trends. It’s conducted in-house by Saks. This latest survey is based on responses from 2,832 U.S.-based respondents over age 18 and was fielded between Jan. 13 to 17. Saks.com previously conducted five Luxury Pulse surveys. Those surveyed are engaged Saks shoppers who could also be shopping other luxury retailers, and they are not queried on the Saks business specifically.
“I’m a glass half full guy,” said Saks.com’s chief executive officer Marc Metrick, when asked to cite some standout findings from the Luxury Pulse. “So I’ll start there by saying that 62 percent of luxury consumers indicated in our survey they would spend the same if not more over the next three months, than the last three months. That’s good. The half empty side is that when we asked that same question in September 2022, it was 68 percent.
“So the story is the luxury market and the luxury shopper is certainly going to be more resilient than what you’re seeing overall” in other areas of consumption. “But there’s waning momentum there. Things are starting to kind of slow a bit,” Metrick said.
The CEO also pointed out that of the 72 percent ready to travel, they’re set on buying something to wear for the trip. “Luxury apparel and accessories are going to continue to participate in the consumers’ lifestyle as they make that transition, sort of back into the experiential spend,” Metrick said.
Almost two years to the day, the Saks Fifth Avenue store fleet and The Saks e-commerce operation were split into separate companies by the parent company, the Hudson Bay Co. Insight Partners, a venture capital and private equity firm, made a $500 million minority equity investment in the Saks e-commerce business at the time. As stand-alone companies, Saks Fifth Avenue’s e-commerce business is now known as simply Saks, and the 39-store Saks Fifth Avenue fleet is known as SFA.
Since then, with more resources at its disposal, Saks.com has been digging deeper into the lifestyles and shopping attitudes of luxury consumers. “We built a lot of capabilities around customer analytics, research,” Metrick said. “And one of the things that we really started doing was going out and talking to the luxury consumer. I don’t mean just with the core luxury consumer that lives 100 percent of their life through a luxury lens. I mean folks that are qualified and interested in luxury products and we talk to them and and we learn a lot about what’s on their mind, not just how they feel about the economy or spending.
“It’s a very small percentage of our customers that are in that pure luxury play, but they represent a pretty healthy amount of our volume. I want to be less concentrated. I want luxury to be a part of everything that we’re doing, for everybody who wants it. As that consumer gets back into the experiential spend game, I’m going to be right there along with them on the journey. I can actually target that” on the Saks.com luxury website.
“We have always sold luggage but you might see it more online versus a physical store. I could feature it on the homepage. I can feed you emails, just to you, because I know that if you’ve been looking now on our website for things that are off-season, such as bathing suits on Saks.com, I might target you with luggage.”
Metrick also explained that Saks.com’s Live Saks interactive livestreaming reflects spending trends, such as by highlighting buyers to show how they pack to travel to Europe for fashion shows, or what they will wear to a wedding, or to some other special event, to give an insider’s take.
The Saks Luxury Pulse, said Metrick, captures “the sentiment” of the luxury shopper. “I’m not looking to forecast my business based on the Luxury Pulse. It’s about gauging their mood” toward luxury purchasing. “Where are they? In retreat? Or not in retreat? It’s really a binary question,” Metrick said. “The overall sentiment is that they are not in retreat. But they are certainly less in the go-forward [mode] than they were back in September.”
The Saks Luxury Pulse also provides consumer insights on fashion trends and social media inspiration, as well as on spending and travel attitudes. Among the January findings:
- Sixty-four percent of Millennials were going to spend the same if not more on luxury. The demographic exhibited a more positive spending attitude than Baby Boomers or Gen X.
- Respondents with an income of $200,000 or more plan to prioritize spending first on travel, events and activities, followed by clothing.
- Those planning to spend more on luxury said their finances are in a good place and they want to update their wardrobes.
- While embracing travel, nights out and attending events, luxury consumers are shopping for these outings, as well as for office settings.
- The most desired travel destinations are those providing warm weather and beaches, with 32 percent of the respondents eyeing those; 18 percent want to visit a big city.
- Women are embracing spring fashion trends, particularly colorful styles and statement tops; men are embracing sophisticated dressing including tailored suits. Sneakers and loafers are also high on men’s shopping lists.
- Consumers are using social media — 55 percent use Instagram — for inspiration on luxury.
- The most desired shopping services are free basic alterations — 64 percent — and in-store returns, 55 percent. Saks provides those services through the Saks Fifth Avenue stores.