Frugal chic is so 2009 - at least among the country club set.
After a couple of years of "shopping in their closets" or settling for a cheaper Prada bag, luxury shoppers have cast off their spending shackles.
Turmoil in the stock market last week has threatened to curtail some of that momentum. But until now, at least, affluent shoppers have been spending at levels that are beginning to resemble the free-wheeling boom years.
Igal Alon, owner of Mavrik Fine Jewelry & Diamonds in Kirkwood, has sold five diamond rings worth more than $50,000 in the past month. The sales surge has come during what is usually a slow season because many of his customers are often away during the summer.
"It's Christmas happening in August this year," Alon said.
This year has the potential to be the best in several years at Savile Row Custom Clothiers in Ladue, which sells custom-made suits priced up to $2,000 to many chief executives and small-business owners around town. Sales are up 23 percent this year, said David Shockley, the store's owner.
Many of his regular customers who disappeared for a year or two have begun to return in the past 12 months.
"It's taken a year to do it, but we're finally back up to" prerecession sales numbers, he said. "There was a pent-up demand. In those real lean times of 2008, people held off. But when their portfolios began to recover, they felt better about going out and spending money."
And when Nordstrom opens at the St. Louis Galleria next month, these customers will have another place to shop. The new store will sell more higher-priced brands not offered at its West County Center counterpart, such as Jimmy Choo shoes and Marc Jacobs handbags.
For the vast majority of Americans who still head to discount stores and seek out sales and promotions, the shopping habits of the affluent may be a sore spot.
But it's an important segment to watch. While luxury makes up a small sliver of sales, retail experts say it often can be a bellwether for overall consumer spending.
"There is a halo effect when people start spending again," said Sherif Mityas, a partner in the retail practice of the consulting firm A.T. Kearney. "It usually starts at the top and then trickles down."
Luxury retail tends to be closely tied to the performance of the stock market. But Mityas said it doesn't usually respond to short-term swings. So unless the recent market fluctuations lead to a double-dip recession, he expects luxury shoppers to continue making big, showy purchases.
After all, fur appears poised to have a big year and probably will be in many, if not most, fall collections, Mityas said.
Luxury retail is still down about 4.4 percent from where it was in the year before the recession, said Mike Berry, director of industry research for MasterCard Advisors SpendingPulse.
But it's been on a growth spurt this year, outpacing the performance of most other retail sectors, he said. The biggest increase in luxury sales came in July: 11.6 percent, compared with an overall retail increase of 6.4 percent, excluding gas and auto sales, according to SpendingPulse.
When the financial crisis began, luxury retail was hit earlier and harder than the rest of the industry, recording double-digit sales declines in 10 out of 11 months starting in October 2008, Berry said. Some months had sales declines of nearly 20 percent.
Many luxury shoppers still could have afforded high-price items, but it became socially unacceptable to flaunt those purchases when the rest of the country was mired in a recession, said Martin Sneider, an adjunct professor of retailing at Washington University.
"Conspicuous consumption was in bad odor," he said. "There was a taint connected with it. ... To come prancing in with the newest Louis (Vuitton) bag, it just wasn't cool."
But as the stock market rebounded, so has the comfort of luxury shoppers in going back to their old ways.
One question now is whether market volatility will dampen their enthusiasm.
Another question is to what extent "aspirational" shoppers - middle-income shoppers who reward themselves with an extravagant purchase now and then - have returned. Sneider thinks that Saks Fifth Avenue and Neiman Marcus might have lost some of those customers because many were buying beyond their means in the boom years.
But Mityas said aspirational shoppers are showing signs of coming back. They still trade down on their staples - their milk and eggs, if you will - but now they want to splurge again on a marquee item to make themselves feel good, he said.
"The aspirational shopper says, ‘I'm sick of saving money. I'm sick of reusing stuff in my wardrobe. I'm going to go out and buy a new bag,' " he said. "It's kind of like therapy."
In a nod to this kind of shopper, midtier stores like Macy's have begun carrying more higher-end items. The focus on exclusive designer brands is one reason Macy's cited last week for a strong second quarter in which same-store sales rose 6.4 percent.
Town and Country-based Kellwood, an apparel conglomerate which makes private-label clothes for Walmart, has been moving more up-market in recent years to try and capture a bigger share of the lucrative luxury market. Kellwood has acquired a series of higher-end labels in the past year including Rebecca Taylor and Adam. And it's reportedly courting designer Catherine Malandrino.
Doug Moss, manager of the Saks store at Plaza Frontenac, said he's seen a measurable increase in customer traffic in the past two year years. Sales of designer clothing, handbags and shoes have been on the upswing, he said.
"The customer seems to be reaching for a higher price point," he said. "And we're seeing a much higher percentage of regular price sales."
And while Saks had adjusted its breadth of merchandise in the past couple of years to have more items at moderately priced levels, the store is adjusting inventory to make sure it has plenty in its "best" category, he said.
In addition to the higher-end labels that will be carried at Nordstrom's St. Louis Galleria store, the company also will be moving over its designer collection, including the likes of Roberto Cavalli, from the West County Center store.
While it's not the most exclusive collection that Nordstrom can offer, the assortment at the Galleria store will be a respectable mix of brands that makes sense given the audience, Washington University's Sneider said.
"To me, it sounds like a B or B-plus kind of store," he said. "It is a very upscale, excellent assortment of brands. ... It's consistent with the top end of what the Galleria will accept."
The rebound in luxury shopping has helped drive impressive sales growth at Nordstrom, which last week reported a 7.3 percent jump in same-store sales in the second quarter. Designer merchandise, which slumped a bit during the recession, has been one of the company's strongest performing categories so far this year, said Brooke White, a Nordstrom spokeswoman.
Another strong sign is that customers picked up a lot of regular-price items during Nordstrom's clearance and anniversary sales this summer, she said.
Still, Nordstrom tries to keep a broad offering of moderately priced to higher-end items in its stores to appeal to customers who do a lot of "high-low" shopping these days, White said.
"Somebody might wear a $15 pair of flip flops with a $130 pair of jeans - and they might be carrying a $1,200 handbag," she said.
