Belt-tightening times are helping to redefine 'luxury'

MORGANTOWN, W.Va. — At The Wine Rack, where sales from the $10-and-under shelves are booming, Jocelyn Vorbach says aloud what most of her customers won't: Friendships now have price tags, and dinner guests are gauged.

"There are friends who get the $300 Caymus and there are friends who get the $10 bottle," Vorbach says. "They're saying, 'I like them, but I don't like them that much.' "

Even wealthier customers are stocking up on bargain bottles, though they tend to purchase by the case.

"Before, they wouldn't be caught dead with a $9.99 bottle in their presence," she says. "But now they will. As long as I tell them it's a good one."

It's a matter of redefining luxury — and redefining nonessential — in an economy whose most consistent product might seem to be dismal daily headlines.

Ultimately, though, "essential" and "luxury" are personal definitions, choices driven not only by how much money remains when the bills are paid but also by our position on the social ladder, our sense of how to stay there and the feelings we get from the things we buy.

The numbers show Americans are already choosing: Starbucks is closing 100 underperforming stores. Sales of trucks, SUVs and roomy sedans are plunging. Retailers are slashing prices to lure shoppers back to the malls. Though 94 percent of us still pay our mortgages on time, some are giving up extras or tapping into savings to do so.

Even in a college town like this, with a robust local economy, people are cutting back. Vicki Stemple, a registered nurse, buys only the basics at Sam's Club.

"This car needs a catalytic converter, and it's $800," she says, loading her silver Toyota Matrix with eggs and laundry detergent. "No way. It's not happening."

Notions of what's necessary and what's extra are always changing, says Juliet Schor, a sociologist at Boston College. Dishwashers, air conditioners, washing machines and color TVs were once indulgences. Today, they're basics.

Consumers now may be considering things like clothing labels and coffee brands or cooking at home vs. dining out, says Schor, author of "The Overspent American: Upscaling, Downshifting and the New Consumer." When times are trying, the focus turns to value. The "status premium" that people are willing to pay shrinks, whether the product is a high-end lipstick or a gas-guzzling vehicle. And with awareness that neighbors are suffering, conspicuous consumption becomes less comfortable.

"So people postpone purchases. People take on less debt and pay off more debt. They just get more conservative," Schor says. "In the portion of the income ladder where people are doing a lot of discretionary spending, there's a lot more room for cutting back without getting into necessities."

James Twitchell, advertising professor at the University of Florida and author of "Living it Up: America's Love Affair with Luxury," argues most people shop to meet desires, not needs.

"Great chunks of the middle class have the needs down pat, so it's all shopping for emotion," he contends. "Now, instead of trading up, we're trading down. But we're still trading. It's not as if we all of a sudden went into voluntary simplicity."

And what we're buying, he argues, is often the story behind the product.

"Take a purse," Twitchell says. "You go to Gucci, Fendi, Prada, Louis Vuitton. These are simple objects. ... But they have a very intense narrative overlay. ... It looks like the same bag, but it's not really a bag at all. It's how someone understands the story of that bag."

Conventional wisdom suggests the rich are spared when the economy tanks. But that's wrong, says marketing expert Pamela Danziger, who studies the consumption habits of Americans earning at least $75,000, about 32 million households.

Those "comfortably off," with an average income of about $150,000, "really do the lifting when it comes to consumer goods," she says. "We're talking about the people who shop at Nordstrom's and Macy's and Nieman's and all the small specialty chains. And they feel a great lack of confidence, which is translating into significantly reduced spending."

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