Justine Griffin/Sarasota Herald-Tribune—Jewelry, cars, electronics and high-end clothing lines were hot items again this holiday season as luxury sales continue to outpace the rest of the retail sector.
The performance was not as strong as in the preceding two years, but still reflected a sharp recovery for the luxury sector since the Great Recession.
“In these sort of distressed retail times, luxury usually outperforms all other retail, but it hasn’t been as substantial this year,” said Jeff Green, retail analyst with Jeff Green Partners.
The luxury sector performed better than most big-box retailers — chains such as Target and Walmart, which will have little to show for their extended hours and several dozen rounds of marked-down prices this holiday season, Green said.
“The shoppers who did well this year are from an older demographic,” he said. “The stock market is so robust right now and older people are feeling better about spending money on themselves. Markets like Sarasota have fared better because of this.”
Holiday retail sales overall have fallen flat this year. With promotions beginning earlier than ever and doorbuster deals stretching from Gray Thursday to Cyber Monday, retail analysts say that shoppers made fewer trips to stores and malls in 2013 than in years past. Overall sales for the 2013 season were up by 3.5 percent, according to Mastercard SpendingPulse, the first consumer spending firm to release holiday shopping figures.
Sales were strongest this year in jewelry and clothing, which rose by 2.3 percent, according to SpendingPulse data, which tracks sales at stores and online through payment forms.
“Sales this year are very mixed. But if you’re Tiffany’s, Prada or Nieman Marcus, you’re doing just fine,” said Howard Davidowitz, chairman of Davidowitz & Associates, a New York-based retail consulting and investment banking firm.
About a quarter of consumers said jewelry was on their Christmas lists this year, according to the National Retail Federation. A third of shoppers planned to purchase electronics.
Despite record sales of Microsoft’s new Xbox One and the new Playstation 4, which both reported over a million units sold in the first 24 hours, electronics sales hovered around the same as in 2012. Other new tech items that debuted in 2013 included Apple’s iPad Mini with retina display and the iPad Air.
Brands like Apple, Xbox and Saks Fifth Avenue sell well every year because of the “status” that comes with owning one of their products, whether or not there were deep discounts.
Strong local sales
In Sarasota, Armel Jewelers on St. Armands Circle kicked off its peak season with strong sales through the holidays, said sales associate Nancy Abate.
“We’re having a very strong start so far. We added a few new lines that helped tremendously,” Abate said.
New lines included Jerusalem cross necklaces and handmade knives and pens for men by William Henry. Other big sellers for the local jeweler included art glass pieces and one-of-a-kind merchandise from its estate sale section.
“We’re less affected by the state of the economy than most other places,” Abate said. “Sarasota is unique because of our large seasonal clientele. They’re ready to spend money on gifts and for themselves more often than other people. It’s been a great start and we expect the same pace for the snowbird season in 2014.”
The housing market, which has rebounding faster in Florida, may have contributed to more luxury sales, Davidowitz said.
“Housing is strong right now. If you’re a Home Depot or furniture business, everything is great,” Davidowitz said. “Homes are more valuable, so people feel better about spending on improving their home.”
Florida posted the highest level of cash home sales in the nation in November. Florida’s average was 62.7 percent, by comparison, the U.S. average was 42 percent.
Furniture and auto sales were up in Southwest Florida, too.
Luxury at large
Some of the year’s most expensive gifts included a $10,000 motorized scooter, the Vespa 946, and one — just one — fresh water chocolate truffle from Struthers Truffle Trading Co. for $104.
Tiffany & Co., which plans to open its first store in Sarasota market in the new Mall at University Town Center, was the best performing stock in the Standard & Poor’s 500 index, with shares rising 8 percent to $87.51.
Strong sales in Asia in 2013 helped the high-end jewelry chain’s profits rise by 50 percent in the third quarter.
Overall, luxury sales worldwide are expected to exceed $318 billion, according to Euromointor International, a worldwide research firm. That figure represents 3 percent growth over 2012.
Compare that figure to the projected $160 billion in retail sales during the holidays in America.
While most luxury sales were driven by transactions in emerging markets like India and China, the United States continues to lead the luxury-goods industry.