The luxury market had been experiencing a 9 percent increase year-to-year prior to the Great Recession, but between 2007 and 2009, it dropped precipitously by more than 13 percent, according to Cognizant 20-20.
Even the Wall Street Journal has speculated on how much the experience of the recession might affect the basic business model for marketing luxury goods. But Cognizant 20-20 Insights is firm about a recovery in the United States that is lagging in both Europe and Japan.
But you don’t have to go to numbers crunchers to find out how the economy is faring. Just ask luxury retailer Marie Eiffel about what she’s seeing in her stores on Shelter Island Heights and in Sag Harbor since the recession hit. Even though her best seasons are during the summer when the population in a vacation area like the Island swells, her early holiday shopping weekends are running steady with previous year’s November and December sales until this past weekend.
An inadvertant cut in a story about holiday shopping on the Island resulted in Marie Eiffel customers thinking her stores here and in Sag Harbor were closed for the season. It wasn’t until one of her workers pointed out the lack of sales that she realized the shop hadn’t been included in the printed story for which she had been interviewed. She rapidly got out text messages and emails to regular customers and things began to pick up, she said.
“I’m trying to help people on the Island be able to get special gifts,” Ms. Eiffel said about pricing this year that, on many items, is at cost. She showed off a cashmere sweater priced at $299, explaining that between the cost of manufacturing and shipping from Italy, it cost her $300.
“I won’t give it away; I’ll keep it” if no one buys it, she said. She admitted some of her workers are eyeing a few items in the shop here they hope no one will buy so they can buy them after the holidays.
Yes, there are cashmere sweaters for less on sites like Land’s End, but at a department store like Nordstrom, the prices are ranging from $250 to $350. And cashmere scarves Ms. Eiffel is offering for $95 will cost you between $158 and $650 at Nordstrom.
She’s selling cashmere gloves at half-price, just about covering her costs “because it’s Christmas” and she wants her customers to be able to find the luxury items they crave for themselves and to give as gifts.
She has been in business seven years and this year determined to maintain her sales staff by paying them through the off-season even when the store is closed. That results in more knowledgeable and steadier staff, she said.
But it also means getting enough in sales through the holiday season to sustain the business even in the slower winter months.
What she won’t do is buy less expensive, cheaply manufactured goods to lower costs because her customers expect quality and she’s determined to deliver it, she said.
Marie Eiffel shops here and in Sag Harbor operate Thursdays through Mondays.
Other retailers who inadvertently were cut from last week’s story on Island shoppers were Shelter Island Heights Ace Hardware where shoppers will find Christmas decorations. And the Island’s two liquor stores, Dandy’s Liquors on North Ferry Road and Shelter Island Wines and Spirits on Bridge Street have holiday promotions and proprietors hope their stock will help to make the season a bit more jolly.
You might think the words luxury and recession can’t be spoken in the same sentence and for many holiday shoppers, that might be the case. But in the slowly recovering United States economy, there is hope, according to Cognizant 20-20 Insights, a leading provider of information for many of the world’s leading companies.