Satchelnomics: Contemplative consumerism

As the frenzied opening scenes in Jim Carrey's 2000 film The Grinch Who Stole Christmas are being recreated in Westfield shopping malls across the globe, spare a moment for the puppies I spotted at a Broadway shop who are being sold at 20% off. 

Leaving aside the RSPCA plea that pets do not make ideal Christmas presents (particularly not when there's a surprise factor involved), the little puppies represent a consumer climate in which pre-Christmas sales are now the norm (who'd pay full price?) and consumers – not retailers – rule the world.

Once upon a time, you would shop for that which you could afford at places that catered to your budget. Thrift store shopping was less a novelty, more a necessity, for some. But with brand awareness increasing via the media over the past 30 years, coveted brand names and items have found a mass appeal. Signifiers of one's social cache, the brands one wore – perfume, sneakers, makeup, watches – indicated where we saw our place (and worth) in the world.

The first recession Gen-Y can remember hit in the early 1990s following the stock crash of 1987. By then our appetites for brand names were already whetted. But is was a long time between 1991/2 and the dotcom crash of 2000. Habits were formed; lusts for stuff were gratified. It's hard to shake such habits.

Retailers got crafty. The more-for-less rule of thumb emerged prior to the GFC of 2008 as discount retailers lured big-brand names into their doors (think Stella McCartney for Target) with the view that the masses would follow (they did) while knock-offs were manufactured cheaply in China.

The result is a consumer environment where the real cost of things is not really known. And the cumulative effect is a valuing down of goods... like puppies.

The old rule used to be, if you can't afford it, you don't buy it; and if you really want it, you put your pennies away. Now it's anything within your reach with the right discount deal (Spreets, anyone?) or with a credit line large enough.

Consumers lured by the appeal of a brand, or a capitalist dream (a puppy for Christmas!) are playing into the hands of a phenomenon which threatens to create real structural damage and create unnecessary hardship for those Jones' who can't keep up the lifestyle expenditure.

Retail egalitarianism has put things out of whack. It's fakery and we were tricked, damnit!   

Traipsing around an impressive L.A. shopping mall on Monday (Stella over here, Miu Miu over there and everything else in between), it took all my willpower to remember myself: do not be lured by the Madewell store on account of Alexa Chung! Put that H&M leather bag (50% off today!) back down! Like many women (most?), I do like to shop, but I don't like to succumb because I loathe feeling duped and dumb.

A few nice things, all things considered, are much nicer than bags full of regret. Hence: contemplative consumerism. Consider what you want and why you want it before heading to the shops, and be prepared to just walk away if something doesn't feel quite right (even if it bears a discount sign). Better to not compromise your values or credit rating.

In a piece titled 'Cheery Shoppers Mask Perils' for The Wall Street Journal, Ben Casselman writes, "So far, consumers appear to be shrugging off the economic uncertainty. Black Friday sales set records. Consumer confidence has begun to recover. Spending, adjusted for inflation and seasonal trends, has risen in three of the past four months, and most economists expect the trend to continue through the end of the year."

Americans are in denial. Despite the enthusiasm for spending and comfort with credit card use, disposable income has declined, average wages fell in November after two months of small gains, household net worth declined by $2.4 trillion in the third quarter, the unemployment rate sits at 8.6 per cent, home values continue to slide and many are still working off debts from the boom years.

Changes made in the aftermath of the recession have failed to become ingrained financial habits. "They're not going to sacrifice opening those gifts under the tree Christmas morning," said investment adviser Clark Hodges, of the Christmastime consumer splurge.

Meanwhile, Gucci Kids has opened on Fifth Avenue, suggesting that where there's a consumer will, there's a store just waiting to cater to it. "For the two-to-eight crowd, there are pale-pink biker jackets made from water snake ($3,800), hooded double-breasted rain coats in a Gucci-logo print ($545), camel hunting sweaters with suede patches on the shoulders and elbows ($340), canvas handbags with leather trim meant to look like large, cute rodents ($515), a backpack made of coated Jacquard canvas ($825), and classic loafers and driving shoes garnished with the company's signature horse bit ($265, $245), reports The New Yorker's Patricia Marx, adding, "I once heard a child in the park say, 'Daddy says Gucci loafers are the best loafers to play in!'". 

Still, there's evidence amongst the U.S. chain stores – whose sales have fallen for two straight months – that the charm of festive shopping has been curtailed. "Luxury spending has been strong, but department stores and other retailers that target the middle class have lagged behind," says Casselman.

Closer to home, Australian banks have been warned: prepare for the worst. Encouraged to bunker down in case of emergency, the Australian Prudential Regulation Authority (APRA) has told them to prepare for the worst by implementing stress tests as the European sovereign debt crisis threatens to set off a global recession pulling even China down with it.

The banks have a one-week deadline in which to prove themselves capable of withstanding the impact of a worst-case scenario in which gross domestic product (GDP) contracts, unemployment rises to 12 per cent, housing prices decline 30 per cent and commercial property values plummet 40 per cent. In short: economic Armageddon.

Aussie families – sensible bunch they are – are doing much the same, insulating themselves from the January debt hangover particular to the post-Christmas season. The Westpac Consumer Sentiment Index fell 8 per cent for December despite last week's interest rate cut, which under different circumstances may have caused Aussies to spend a little more at the stores.

"Risk aversion increased markedly in this survey," said Westpac chief economist Bill Evans. "When asked about "the wisest place for savings" 26.6% of respondents nominated "pay down debt". That was an increase from 18.7% in September. Since we started measuring that component in 1997 there has only been one higher measure, in March 2010."

According to Evans, the survey results demonstrate that the bad news out of Europe has overwhelmed positive news about RBA rate cuts in the eyes and ears of Australians. This has led to what's being called "the new conservatism", which sees consumers pour income into debt reduction and curb their spending. So longer-term thinking trumps short-term purchasing.

Good news for the puppies.

Girl With a Satchel


Camilla @ Girls Are Made From Pepsi said...

Excellent post Erica! Kind of reminds me how smaller dogs used to be the ultimate accessory (and still kind of are for some).

I work in retail to supplement my income, and retailers are certainly facing harrowing times. Not a day goes by when someone will ask when the next sale is, can they have an extra discount on top of the already existing discount, is it cheaper if they pay in cash, etc, etc. I'm so not cut out for retail, ugh! I feel wretched for convincing people to pay for expensive things they don't need.

Laura said...

More importantly, buying puppies from pet shops keeps the appallingly cruel puppy farming industry alive. Buy from a shelter or a registered breeder. We need to stop viewing animals as commodities.