On CNBC’s Closing Bell, host Sara Eisen put a simple question to Consumer Edge’s head of insights, Michael Gunter: what’s happening with the high-end shopper? His answer was blunt. In Consumer Edge’s transaction data, the newest customer growth at Walmart, Dollar General, and Dollar Tree is disproportionately coming from high-income households. That pattern held in the latest fiscal quarter and, Gunter added, continued into August. In plain English: affluent Americans are trading down, and the retailers built for value are meeting them halfway.
What The Data Actually Shows, According To Consumer Edge
Gunter told Eisen that this isn’t merely a social media vibe shift – it’s in the receipts. Even as wealthier consumers benefit from rising asset prices and generally healthier balance sheets than lower-income peers, they’re “still looking to manage spending,” “still looking for deals,” and actively responding to broader assortments designed to court them in big-box and dollar chains. My read is that after three years of price shocks and “shrinkflation,” even the well-off have learned the muscle memory of value hunting – and retailers that widened their mix to feel less “bare-bones” are getting rewarded.
Why The Trade-Down Is Accelerating Now
Eisen noted that luxury brands hiked prices aggressively – especially in leather goods – and asked if sticker shock is finally biting. Gunter agreed: luxury has been “consistently weak for several quarters,” with little sign of a near-term turnaround. He contrasted a $600 Coach bag growing double-digits with $4,000 designer handbags that no longer feel justifiable to many buyers. That mental math – “good enough luxe” vs. “aspirational pain” – pushes shoppers into the middle and down-market tiers. My view: we’re in a vibe recession at the top end; conspicuous thrift is replacing conspicuous consumption.
Off-Price Is Having A Year
Pressed by Eisen on who else benefits, Gunter didn’t hesitate: off-price. TJX (TJ Maxx, Marshalls), Burlington and peers have strung together strong results – and momentum is “accelerating.” The off-price model thrives on treasure-hunt psychology and opportunistic buys, which aligns perfectly with a high-income shopper who wants quality, novelty, and a “win” at checkout. If luxury is a museum, off-price is an outlet carnival – and right now, the carnival wins.
Resale Went From Niche To Default – Especially For The Affluent
Gunter told Eisen that resale platforms – Savers Value Village, Depop (owned by Etsy), and others – are “one of the best-performing sectors of the year.” Crucially, he said high-income consumers are “spending more at resale and increasing their spend more than the rest of the consumer base.” That’s not just about sustainability signaling; it’s the thrill of the hunt and the satisfaction of arbitrage. The stigma on secondhand has evaporated. In 2025, shopping resale signals savvy, not scarcity.
The Strain At The Bottom – And A New Macro Risk
Eisen then pivoted to the low-income consumer. Gunter said plainly: they’re “not holding up as well.” That tracks with what many retailers have flagged – more deal chasing, smaller baskets, and trade-downs in categories like protein. The bigger macro risk Gunter highlighted: if the high-income “engine” that has been carrying overall consumption starts to falter, the retail picture deteriorates quickly. In other words, strength at the top has papered over weakness at the bottom; if the top slows, there’s no cushion.
Where Discretionary Spend Is Getting Trimmed
Gunter told Eisen that he already sees pullbacks in discretionary areas: airlines, lodging, and full-service restaurants. Those are classic bellwethers for confidence. When even affluent households re-prioritize, experiences with high service fees and dynamic pricing can be first on the chopping block. My read of this is that 2021–2023’s revenge-travel spree is normalizing, and the new splurge is paying less for the same basket at a different store.
Prices Are “Range-Bound” At The Giants
Eisen asked whether retailers are passing through higher costs, tariffs included. Gunter’s answer should comfort consumers: at Walmart and Target, Consumer Edge’s tracking shows prices have been “range bound.” Yes, there are weeks when certain categories creep up, but it’s not broad-based. Translation: the biggest players are leaning on scale, mix, and margin math to avoid sticker shocks that could spook their newly acquired high-income guests. In my view, pricing discipline is a competitive moat in 2025. Win trust now; earn loyalty later.
Apparel’s Mixed Picture – And A Shein Shock Absorber
On goods inflation, Eisen singled out apparel, which doesn’t “feel” as inflationary as other categories. Gunter agreed: it’s patchy. He pointed to fast fashion: after the de minimis exemption was removed, Shein raised prices. Yet, he said, Shein “didn’t really suffer too much” in market share – evidence that even price-sensitive consumers will absorb modest increases if they still perceive value. The broader point: apparel has plenty of price points; consumers can trade brands, channels, or quality tiers without abandoning the category.
“Better Than Feared” – But The Floor Isn’t The Ceiling
So what’s the health of consumer spending overall? Gunter told Eisen it’s “holding up relatively well… better than feared.” The outperformers are “more affordable” areas—exactly where Walmart, dollar stores, off-price, and resale congregate. But he also stressed that overall spending is “much more” driven by the high-income cohort; they have been “carrying it.” If they “buckle,” he warned, it becomes “an issue for the entire retail landscape.” I think this is a high-wire act. The safety net is thin, and the crowd below is already tired.
The Holiday Setup: Winners If The Trend Holds
Eisen closed by pressing for a holiday read. If current behavior persists, Gunter expects resale, big-box, and off-price to be the seasonal winners. That suggests a gift season heavy on perceived value: branded basics from Walmart and Target, “finds” from TJX and Burlington, and trade-ups with a discount narrative (think: mid-tier handbags, entry luxury on sale, refurbished electronics). For brands and retailers, the mandate is clear: sharpen your value story now, or risk irrelevance by Black Friday.
What This Means For Luxury (And “Accessible Luxury”)
Here’s my opinionated forecast. Legacy luxury faces a reckoning. Multiple years of price escalations thinned the customer base; the “quiet luxury” aesthetic now looks like a quiet protest against $4,000 markups. Accessible luxury – well-made, logo-lite, and under $1,000 – has a lane, as Eisen’s Coach example illuminated in her exchange with Gunter. Expect capsule collections, outlet-exclusive SKUs, and aggressive clienteling to woo shoppers who defected to resale and off-price. The brands that blink first on price integrity might win back volume without torpedoing equity – if they wrap it in a “limited” or “members-only” bow.
For Investors: Watch Mix, Not Just Comps
Gunter’s commentary with Eisen implies three investor tells. First, watch mix shifts among big-box and dollar chains – growing high-income penetration should coincide with better private-label performance and higher gross margin dollars, even if ticket stays modest. Second, off-price traffic and inventory freshness matter more than ever; the better the pipeline, the stronger the holiday. Third, resale platform GMV growth among higher-income cohorts is a canary: if it cools, the high-income “engine” may be stalling system-wide.
How Retailers Can Court The Affluent Deal-Hunter
The Consumer Edge readout suggests a practical playbook. Elevate private label with quality cues (fabric, fit, warranty). Curate endcaps and limited drops that feel “special” without being expensive. Maintain price credibility – Gunter’s “range-bound” insight is a feature, not a bug. And, as Eisen’s questioning implied, craft marketing that normalizes value for everyone. The pitch isn’t “cheap”; it’s “smart.” If you make a shopper feel clever, they’ll come back with friends.
The Culture Shift Is Real – And Sticky
Eisen’s conversation with Gunter captured something bigger than channel checks. High-income shoppers aren’t just coping – they’re choosing. Resale’s “thrill of the hunt,” off-price treasure hunts, Walmart’s broadened assortments: these are experiences, not compromises. Once affluent consumers learn they can get 80% of the joy for 40% of the price, it’s hard to go back. In that sense, “forced to shop at Walmart” is only half the story. Many will keep doing it because the dopamine hit is better.
Value Is The New Premium
Sara Eisen asked the right questions; Michael Gunter brought the receipts. High-income shoppers are trading down – toward Walmart, Dollar General, Dollar Tree, TJX, Burlington, and resale platforms – and they’ve been the ballast for U.S. consumption. Prices at the giants are disciplined, luxury is wobbling, and apparel inflation is uneven. The setup into the holidays favors value channels. My take: this isn’t a blip. Until pricing power and consumer confidence realign, value is the new premium – and the smartest retailers will make it feel that way.
Growing up in the Pacific Northwest, John developed a love for the great outdoors early on. With years of experience as a wilderness guide, he’s navigated rugged terrains and unpredictable weather patterns. John is also an avid hunter and fisherman who believes in sustainable living. His focus on practical survival skills, from building shelters to purifying water, reflects his passion for preparedness. When he’s not out in the wild, you can find him sharing his knowledge through writing, hoping to inspire others to embrace self-reliance.
