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Corks pop on consumer revival
Rebecca Lowe and Jonathan Prynn2 Oct 2009
Big spending is back in fashion as shoppers shrug off "bank crash" guilt and start splashing out in the approach to Christmas.
West End stores say they have been astonished by the sudden return of conspicuous consumption. Sally Scott, marketing director for Selfridges, said customer confidence had bounced back, peaking in the past few weeks.
Champagne sales are up 20 per cent on last year and expensive vintage wine is selling well including a £2,200 bottle of Lafite Rothschild.
In the Christmas department takings are up 56 per cent. Ms Scott said: "Things have really picked up and we are confident of having a hugely successful Christmas. People seem to want to celebrate again after experiencing such a tough year. For many it was less about not having the money, and more about not wanting to be conspicuous with their spending. Now people are proud to be back on the shop floor."
Big sales at Selfridges last week included a £17,000 pair of Tiffany earrings and a £10,000 Dior necklace. The revival has been fuelled by a better year in the City, where the FTSE-100 has surged through the 5000 mark, and weak sterling has attracted European shoppers.
Michael Wainwright, managing director of jewellers Boodles, said the Royal Exchange branch has completed two "six-figure" sales in recent weeks, a diamond necklace and a bracelet. "Business started turning the corner a few months ago when people realised it was not the end of the world," he said.
Liberty spokeswoman Kate Brindley said sales of more expensive goods had "over-performed" in the past two months. Paul Morelli jewellery costing £1,000-£10,000 has proved a best-seller, alongside Hermes cashmere scarves worth £600. She said: "There has definitely been a return in customer confidence at the upper-end of the market. We never expected our Hermes scarves to do so well, as we thought the mid- and lower-ranges would prove more popular. We were really surprised to find so many people were willing to go for the higher prices."
At Harvey Nichols one buyer snapped up a £15,000 Lana Marks Positano bag last week, while September sales at grocer Fortnum & Mason were 15 per cent above last year. "So far this month has been terrific," said managing director Beverley Aspinall.
The alcohol market has also improved. DQ Vodka, launched in the UK last week by former Miss Norway Renate Mjelde, will set buyers back £50. The surge in demand for high-priced goods is mirrored in the housing market, according to property company Quintessentially Estates, which helps wealthy buyers find multi-million-pound homes.
The number of people on their books has "risen rapidly" since March following a steep drop last October. The company said it had also experienced the busiest August it had seen for three years.
