A wide variety of specialty apparel retailers have seen improvements in same-store sales (share prices too) as consumers have seemingly grown tired of not spending. Even high unemployment levels and underemployment have not stopped consumers from spending at higher levels than many expected so far this year.
Marshal Cohen, an analyst with The NPD Group, told BusinessWeek that consumers are shopping now, in part, because they are experiencing "frugal fatigue."
According to Mr. Cohen, "[Consumers] are starting to get tired of having to only shop at the lowest-priced retail outlets, particularly in apparel, which arguably had the worst performance during the recession."
Consumers are still looking for deals, he said, but the perception of value has moved beyond price as the sole focus to take quality and durability more into account.
Among the retailers that have come out of the economic downturn in strong shape are Aeropostale and Urban Outfitters.
NPD's Cohen is a fan of Aeropostale. He told BusinessWeek the chain delivers the right blend of price, value and style for its younger consumer base. Beyond that, the chain is viewed more favorably by parents, who see it as more family-friendly than some competitors who have blaring music and couches positioned in dark corners within the store.
"If Mom comes in and sees that, she says, 'I'm not letting my kid come in here,'" said Mr. Cohen.
Aeropostale's co-CEO Cindy Meads recently told CNBC, "We are promotional every day, and we continue to improve upon our product. We sit on the intersection between fashion and value, and it truly is a powerful place."
Urban Outfitters, according to Deutsche Bank, is "one of the premier growth stories in all of retail." The retailer has benefited with growth in its online business and expansion into foreign markets that promise higher margins on sales. The chain is also expanding into new categories, such as bridal, as it seeks to build on its current momentum.
Barbara Rozsas, chief sourcing officer for Urban Outfitters, recently told The Temple News the company's success is due to "smart merchants, a strong design team, effective internal and external supply chains and great sourcing teams."
Discussion Questions: What are successful chains such as Aeropostale and Urban Outfitters doing that others are not? Would other chains do well to position themselves "on the intersection between fashion and value"?