Pomp and circumspect
Lifestyles
On sales. Indeed, low-end luxe is a fashion hit. Designers' lower-priced lines like Marc by Marc Jacobs are thriving, says David Wolfe, a creative director for the Doneger Group, a retail consulting firm that specializes in luxury merchandising. Shoppers can find other designers' entire collections on sale, depending on the store. Look for regular discounts on Donna Karan, Tommy Hilfiger, and Ralph Lauren, says Cohen. Meanwhile, brands that have always offered affordable splendor are booming. For the second half of 2002, sales for Coach, the handbag and leather goods manufacturer, were up an impressive 30 percent, to $501 million, compared with the same period the year before. "Why do you think their business has been so good?" asks Cohen. "Coach has been able to stay at the lowest price point in the luxury market." Coach bags range from about $150 to $350. Louis Vuitton might cost twice that and Dior twice that again.
Carmakers have learned the same lesson. Customers clamor for cars in the $30,000 range by luxury manufacturers like BMW, Jaguar, and Mercedes. Even Bentley is introducing a new entry-level model at year's end, if a $149,000 auto can be deemed a starter car.
Even jet-setting has taken on a whole new meaning. Kirby Cramer could certainly buy his own plane. But the retired chairman of Hazleton Laboratories has never considered it. Instead, he bought a 1/16 share in two jets from Flight Options, one of a handful of companies that specialize in "fractional aircraft ownership" (216-261-3880, www.flightoptions.com). Cramer owns shares in a five-seater he uses mostly for business and in a seven-seater Cessna Citation V he uses to ferry his four children, their spouses, and his 14 grandchildren between their homes and the Cramer homes in Seattle and Indian Wells, Calif. Cramer paid a one-time fee of $312,500 for his share. If he uses the total 50 hours of flight time he has bought, he'll pay $100,000 in fixed and flight costs this year. Compare that with the $7.5 million he'd pay for a new Cessna Citation Encore, the successor to the Cessna Citation V. "It's definitely more cost effective," he says.
Of course, savvy spending doesn't have to involve millions, or even thousands, of dollars. Bruce McAlpin, a real estate developer in Pensacola, Fla., travels nearly every weekend for business or pleasure. A foodie by any definition, he has sampled the fare at many of the best restaurants in the country. But these days he is opting to lunch rather than dine, especially in pricey cities like New York. Three of his favorites--La Caravelle, La Cote Basque, and La Grenouille--serve an excellent prix fixe lunch for a fraction of what he would pay at dinner. He can enjoy a three-course afternoon meal at La Cote Basque--maybe the house-smoked salmon as a starter, followed by filet mignonettes cooked in a red wine and truffle sauce, and a lemon souffle to finish--for $38, or he could pay $70 for an almost identical meal at night. But at lunch, the service is just as impeccable, the room just as beautiful, and the food every bit as delicious, says McAlpin. Besides, conspicuous consumption feels out of step with the times. "The freewheeling '90s are over," says McAlpin. These days, consumers are making a feast of frugality.
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