Rich consumers seem unfazed by market turmoil. Saks’s CEO has a theory why: ‘It’s really hard to move off of luxury once you’ve gotten used to it’

January 6, 2023, 11:00 AM UTC
Marc Metrick, CEO of Saks photographed on November 29, 2022 at Saks offices art 225 Liberty Street, New York NY.
Photograph by Patrick James Miller for Fortune

Saks’s CEO Marc Metrick isn’t new to economic swings and market volatility—nor are his well-heeled customers. Yet Metrick, who oversees the luxury brand’s digital component, a separate corporate entity from the Saks Fifth Avenue stores, says things are humming nicely. In early December, he told vendors that business was up 17% compared to the previous quarter and that visits to Saks’s website exploded over the Black Friday-Cyber Monday weekend, jumping 35% to 15 million over the same weekend the previous year.

His theory? The affluent hold more diverse portfolios than they used to, breaking the once near-perfect correlation between the stock market and luxury spending. Metrick also surmises that many people of means are hooked on luxury. And it doesn’t hurt that Saks’s clientele is more generationally diverse, with Gen Z and millennial consumers more optimistic about the markets than their parents were.

“Our research shows that the younger customer cohort is less spooked by gyrations in the financial markets,” he tells Fortune

Also helping is luxury’s continued migration online, with in-store shopping slipping overall. In contrast to the booming sales at, Saks Fifth Avenue stores saw business fall 7% last quarter.

Some fashion trends help, too. While suits are out, people are going out more, and business meetings are back. In today’s luxury world, casual attire dominates, Metrick says. “You’re definitely seeing people getting more dressed up again. They’re just not wearing suits.”

This interview has been edited and condensed for clarity.

Fortune: Despite the turbulent stock market and specter of a recession, luxury in the U.S. has been resilient. Why?

Metrick: Part of it is because luxury can play different roles in a consumer’s life. Some of it is aspirational, and some of it is rewarding yourself. During the pandemic, some of it was self-care. It’s really hard to move off of luxury once you’ve gotten used to it.

One of your predecessors and former boss, Steve Sadove, would tell investors during the 2008 crisis that there was a strong correlation between stock market performance and Saks’s business performance. Does that correlation still hold?

When I was Steve’s chief strategy officer, I would run a regression analysis on the Dow Jones and our sales, and the R-squared (correlation co-efficient) was a near-perfect 0.99. It’s not as tight today because there are so many other factors: There’s the bond market, crypto, and other asset classes, so it’s more complicated than it was back then.

Saks has moved away in recent years from standard fare like men’s suits to casual, active, and streetwear. Is that proving to be a permanent shift in luxury spending?

The ‘casualization’ shift is permanent. It’s hard to say what will happen with street trends because that’s fashion, and nothing in fashion is permanent, or else it wouldn’t be fashion. At Saks, we saw this ‘casualization’ before the pandemic and work-from-home boom, so we de-emphasized our traditional sartorial offerings. Take what I’m wearing as a case in point (a Kiton blazer and a Brunello Cucinelli sweater): I’m not wearing sweatpants and sneakers. It’s luxurious and polished, but it’s comfortable.

What about the impact of working from home on Saks? 

I consider Saks a ‘go out and travel’ business. So as long as people are going out, having work dinners, work functions, holiday parties, board meetings, or going to court, we have what they need.

More luxury brands are opening their own stores and improving their websites. What does offer brands that they can’t get on their own?

First, lots of choices for consumers. When some people shop, they know what they want and can go to that brand’s store and buy a shoe. But a lot of consumers don’t think like that. They want a boot or high heels, for example, but they don’t know what brand they want. So why not go where there are 1,800 brands and hundreds of thousands of styles to choose from? Second, we use data to market and introduce brands to people. These brands don’t have the data from the 430 to 450 million visits from luxury consumers that we expect Saks’s site to get this fiscal year.

Saks has made mental health a key part of its philanthropic efforts, and you have posted candid letters to staff on LinkedIn about your struggles with alcohol addiction. Why, as a CEO, share that so openly?

Stigma is probably the common thread that runs through all mental health issues, as well as people feeling they can’t share it and can’t come to work and say, ‘I have a problem.’ There’s now more psychological safety at Saks for people to come in and say, ‘I’m having problems. I’m anxious, I’m depressed, I don’t know how to handle this,’ if I’m out there saying, ‘It’s okay.’

Yet CEOs in previous generations never talked about personal problems and were supposed to be infallible.

Vulnerability is very important, and being relatable as a leader is very important. The more my team knows about me and the more they feel that I’m comfortable sharing this with them, the closer they feel to the company, and the more they understand what we’re going after.

Get to know Metrick:

  • He has run the New York City marathon three times.
  • He joined Saks’s executive training program in 1995 and spent more than 15 years in top management roles, including chief strategy officer.
  • In 2012, he went to Hudson’s Bay Company, where he played a central role in that retailer’s 2013 acquisition of Saks. Two years later, he was promoted to Saks’s president and later CEO.

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