You should never underestimate women's vanity. As retailers report poor holiday sales and analysts predict a decline of aspirational shoppers, they're forgetting one very important factor: Women will always want to look good.
Along those lines, women also love a bargain. In uncertain economic times women may not go to Saks to buy a pretty blouse or some perfume, but they will go to outlets and discount stores to get the same brands at lower prices. I predict that in the next few months stores such as Filene's basement, T.J. Maxx and Loehman's will see a rise in sales as people, especially women, want to maintain the mental illusion of luxury that they created for themselves when the economy was more robust.
On a recent trip to Filene's I walked out with a bag full of goodies that had labels such as Dana Buchman, Theory, and Lilly Pulitzer. Six items cost me about $150. True, designers have always created different lines for discount stores than they do for others, but that's not the point. Women like to think that they're able to get the label, the name. Granted, they'll always pay attention to quality -- no one wants to wear a scratchy sweater -- but as long as designers keep their discount lines on the up and up, they can ride out any recession with flying colors. Target took this idea and ran with it, and now every fashionista I know makes a point to visit the store when they're in the suburbs. H&M took it up another notch and managed to get people waiting overnight and outside for the lines Stella McCartney and Roberto Cavalli created.
Which is not to say that places like Filene's don't need a little improvement. I scoured for two hours before walking out with my booty. A lot of the clothing -- much of which was 60% off -- was akin to crap. Always the treasure hunter, I pressed on, and after several trips to the fitting room I came out with some winners.
The top of the luxury shopping tier will probably not see too much change in the coming weeks, although a recent study sponsored by American Express reported that high-end female shoppers were making fewer trips to the shops mostly because of the rising cost of gas and smaller concerns over the economy. For those women, retailers will focus more on reviving the "emotional" aspect of shopping, and reminding them that buying an expensive handbag will make them feel good.
Then there are the middle class people, the ones who may not need a handbag to reinforce their happiness, but who still need to look presentable. These are the women who spent the last few years indulging in entry-level designer items. Now that they've had a taste of the good life they're not going to want to give it up because of a stock market that happens to be in a slump.
That's where discount retailers have the tremendous opportunity. They can, in theory, pull out ahead by keeping women outfitted in what they were used to having before. That might mean some changes in their stores, such as putting out fewer thread bare tank tops. It might mean adjusting the physical look of the store to make it more aesthetically pleasing. Right now there is nothing glam about Filene's Basement. But if vanity is a driving factor, then catering to that could mean profits, even in a recession.