Telsey Advisory Group Founder Dana Telsey Talks Consumer Spending

SPEAKER_1 (0:02)

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Tom Keene (0:07)

As we begin to date, really, our midterm coverage, we begin to date our Q4 Consumer Dash. Dana Telsey is definitive at Telsey Advisory Group. We're thrilled she's here. It's like a hit record. It's like when something's magical in the movies.

There's a destroyed brand, a guy named Blaisey shows up, and Chanel is like scared. I was going back and forth with Deborah Aiken in London. Have you ever seen a recovery of a house like Chanel in the last year?

Dana Telsey (0:42)

It's been amazing and thank you for having me here, Tom. It's absolutely been amazing. And what's so interesting about it, his impact on the clothing impacted every other part of the company. I mean, even their makeup, if you try to get the Chanel Crush lipstick, it's sold out everywhere. So Chanel is back in vogue, and it's something that Gucci would only like to see, given that they haven't had the star power.

Tom Keene (1:05)

How does Gucci, at carrying a destroyed brand, how do they find this guy blazing?

Dana Telsey (1:11)

They need to find someone too, and some of it's just connecting with, frankly, their customer, but also the next generation of customers and doing it globally.

Tom Keene (1:21)

One more fancy social, I got two more fancy social luxury questions.

Debra A can make it clear to me that the magic is social. Getting out on YouTube, getting out on Twitter, TikTok and all this stuff, Alexis Christophers looks at. That's the new messaging, isn't it?

Dana Telsey (1:39)

It goes viral and it goes global, and it also crosses generations. So the ability to have that appeal is that is that's, I have this theme of the letter A. What are the topics of 2026?

AI, affordability, activation, assortment and agility. Think about what activation is. That's what social does.

Tom Keene (2:00)

One more snobby question. Ira Jersey wants to talk about Home Depot and Target. Dana Telsey, I look at this and I see something that I still think is totally nuts. Hermes in Brooklyn and Williamsburg. What does that signal to you about the spirit here of high-end consumption?

Dana Telsey (2:18)

Williamsburg is where high-end consumers are living, where high-end consumers are going, and it's new neighborhoods that are being activated. Look at the rents overall, even in Williamsburg and Brooklyn compared to Manhattan.

Tom Keene (2:31)

It's not cheap. Jonathan Miller with his Bloomberg Money with Scarlett Foo Friday. Alexis, get in here, a question with Dana Telsey.

Alexis Christodoulou (2:38)

Well, I'm just trying to absorb what you just said. I grew up in Williamsburg, Brooklyn in the 70s and 80s when it was a very different place than it. I mean, if we had a sushi restaurant come in, that was like stop the presses, right?

Why are people continuing to spend despite this high inflation? I guess my question is, where are they putting their money? Are they buying the necessities? Is there discretionary money out there? Are they going out and buying the fun stuff?

Dana Telsey (3:01)

There's discretionary money out there for upper income, but even when you're looking at lower and middle income consumers, they're choosing what to spend on. So they'll choose the experience, they'll choose what they see virally, but then what are they going to buy? The other change in buying patterns is about GLP-1s. GLP-1s are causing new apparel wardrobe changes, new apparel wardrobe purchases, and they're not done because the impact that it has basically extends. So I think there's different reasons for consumption, but higher interest rates is a headwind to housing.

Tom Keene (3:37)

We got a surveillance GLP correspondent, Ira Jersey here with Dana Telsey.

Ira Jersey (3:42)

So let's talk about the other end of the consumer, right? So let's talk about the big box stores, or even the home improvement stores, the Targets and the Walmarts of the world too. How are they doing? I mean, presumably some of them are picking up and maybe others aren't.

Dana Telsey (3:56)

You must have been at our conference last week. I had my conference last week, and basically whether it was Lowe's, whether it was Target, Nike, they were all there. And so what you're seeing out there on the big boxes, look at Target this year. Target's up over 50 percent. The newness in the assortment, the new collaborations. Look at Hollister and Home that's in Target. Look at Warby Parker, Shop and Shops in Target. There's newness there. There's that search for value. You look at Walmart. The fastest part of Walmart's growth is coming from household incomes that are at their highest level for Walmart.