Consumers Shopping Luxury And Discounts, Neglecting Middle Tier

After scaling back shopping habits during the recession, consumers are now surging back to stores with a vengeance. New trends show shoppers are willing to shell out some big dough for quality luxury items, and are also searching for good deals at discount stores.

CNN reports the findings by TelConsumers, which indicate that high-end brands like Gucci, Louis Vuitton and Burberry are doing well, and that shoppers are seeking out low prices on those and other designer brands at stores like TJ Maxx and online sites like Gilt Groupe. Sales of luxury goods are up 10-12% from last year, the findings say.

Meanwhile, those stuck in the middle aren’t doing so well.

Ed Jay, senior vice president of American Express Business Insights, calls this “the barbell effect.”

“They are more high and low in the way that they are spending,” Jay said of today’s consumers. “High-end brands are holding ground among consumers, while spending at value oriented stores has also been pretty stable. It’s a tough place for mid-tier right now,” he said, referring to retailers like the Gap, Chico’s and Ann Taylor.

It seems the recession may have influenced consumers to focus more on quality goods that will last, instead of lots of meh items that they’d have to replace sooner rather than later.This makes sense, as I often pair my sturdy burlap sack dresses with a Fendi handbag.