Luxury goods spending fell in October and November, according to credit card data from Barclays and Citigroup. The report found consumer spending declined 15% year-over-year in November, following a 14% drop in October.

Despite a weakening economy and persistent inflation, Saks CEO Marc Metrick told Yahoo Finance Live the retailer is not seeing any signs of consumers trading down to save money.

"What you're not seeing is a trade down: luxury is permanent, luxury is here to stay," Metrick said. "People are not going to trade down out of it. Folks that reached in, maybe a few years ago, even last year, might not be reaching in this year, but the core luxury consumer doesn't trade down."

Looking ahead, Metrick sees 2024 as "a year of two halves."

"I see the first half of the year, nothing is going to spark the consumer, nothing is going to get them excited... and then as you move into the second half of the year, you're going to get some positivity in the market... It's going to move its way through to the consumer," Metrick added. "There's all this talk of rate cuts in the second half, thats a boon for the consumer."

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Video Transcript

SEANA SMITH: Well, recent credit card data from Citi and Barclays both showing that higher prices and uncertainty may be taking a toll this year. Spending on luxury goods, falling in November and October from their levels a year ago. So how is this holiday shopping season shaping up for that? We want to bring in Marc Metrick. He is a Saks CEO. Along with our very own Brian Sozzi. Great to have both of you. Marc, let's start with what you are seeing this holiday season. How is the very important few weeks here leading up to Christmas shaping up so far?

MARC METRICK: Look, you know, it was a challenging period coming in. And we put some research out into the field. We do a quarterly with the luxury consumer. And look, 75% of luxury consumers indicated that they were going to spend the same, if not more of this holiday-- this holiday period. And we're seeing that. OK? So we're seeing our average unit retails are up, our average order values are up. Some of that is driven by price. Some of that is driven strategically. So that's the good side.

On the other side of it, you've got 25% of folks that indicated they were going to spend less and they are. And we're seeing that manifest in the numbers. So I would couch this as challenging. This holiday period has been challenging, just like the trend of the business was coming in.

BRIAN SOZZI: Marc, Brian, here. Good to see you. Are you surprised by some of these challenges you are seeing in certain categories? Look, the stock market's at a record. Theoretically, that should be good for businesses like yours.

MARC METRICK: Yeah, look, I think we're a sentiment-based business. And the same research we did. The luxury consumer never got overly concerned with their own financial position. So that's not been sort of a big headwind. It also takes a little bit of time for the positivity that's in the market to move its way through to the consumer. So it's not as minute by minute as some folks might think.

BRIAN SOZZI: On a category basis within some of the luxury purchases have-- maybe not-- have you seen maybe not a trade down but a trade off of specific types of SKUs?

MARC METRICK: No. I think what you're seeing are people might be buying one instead of two or they might not be buying but you're not seeing a trade down. People-- luxury is permanent. Luxury is here to stay. People are not going to trade down out of it. Folks that reached in maybe a few years ago, even last year, might not be reaching in this year. But the luxury, the core luxury consumer doesn't trade down.

BRIAN SOZZI: Marc, I'm not going to give you any guff for that. I guess that Zach Wilson Jersey behind you. We'll take that offline. I think I still have your email address. But what--

MARC METRICK: It's a Garrett Wilson jersey, Brian.

BRIAN SOZZI: OK. All right. Fine. All right. We'll take it offline. Just playing what-- Brad, just said, what categories are outperforming? Is it shoes? Is it jewelry? Where are you seeing the biggest sales growth?

MARC METRICK: Yeah, what's interesting is this period of time, all the folks that took this survey, 50% of their spend was going to be self-purchase, right? So you're seeing a lot more go out on travel business. So you're continuing to see that. You're seeing suiting. You're seeing evening dresses. You're seeing all that sort of cold weather footwear, so boots and booties. That's moving well. Outerwear, which has had sort of an unprecedented run. It's been three or four years in a row. I don't know how many coats people can own, but they're still going there. So you're still seeing that win.

And then for the gifting side, the beauty advent calendar, we love it. We make fun of it. But we sold out of it already. And it's something that's exciting, and it kind of talks to the holidays. And you're seeing gold and diamond jewelry, which is something that we're actually amplifying at Saks work really well. So you know, it's been a good story on the luxury side for categories. Nothing's really falling off a cliff. And that's what we like to see-- a good balance.

SEANA SMITH: So Marc, what does all this then tell us about 2024? How you're planning? Where you're expecting to see some strength as we look ahead to the next 12 to 24 months?

MARC METRICK: Yeah, look, you know, I think it's always important for me to mention, we at Saks, we see luxury as a long game. Luxury is here to stay. You can't move your strategy or pivot too hard just based on the near-term outlook. OK? So that being said, we have to be deliberate and very careful as we approach 24. And I'm calling it a year of progress at Saks. But if I were to have to couch it, it's going to be a year of two halves. OK? I see the first year, the first half of the year. Nothing's going to spark the consumer.

Nothing's going to get them excited. This starts in a few weeks, right? So I think the first half of the year is going to be a little tougher. And then as you move into the second half of the year, you're going to get some of this positivity in the market. Hopefully, it stays. It's going to move its way through to the consumer. There's all this talk of rate cuts on the second half. That's a s for the consumer. And then of course, you have an election. Now that can be a distraction. But it's certainly going to bring people's-- they're going to want some escapism. They're going to want to do something for themselves.

So that could be something positive for the luxury consumer. So the second half, I'm seeing to be a bit better than the first.

BRAD SMITH: When you think about the brands that you sell within your store footprints and online as well and all those relationships with customers coming to Saks looking for some of those high value, high cost brands as well, do you believe that we're going to see any more M&A activity within some of those brands?

MARC METRICK: You know, I try not to focus too much on that. What I want is to execute our strategy the right way, to get Saks out in front of it. Whatever happens with our brand partner happens. But I remain very committed to what we're doing here. And that's what we're focused on.

SEANA SMITH: Marc, how are you looking at the prospects here with Neiman Marcus? How you see that fitting into the roadmap here down the road? And we take into account some of the troubles that maybe some of the other luxury brands have had. What do you attribute that to just given your experience and years that you have obviously had in the field?

MARC METRICK: I missed the question a little bit. I heard Neiman Marcus, so I'm not sure.

SEANA SMITH: Yeah, just in terms of the-- I guess the trouble that we have seen play out with other brands within the retail space, when it comes to the success of Saks, what do you attribute that to? And I guess, in terms of what you have learned throughout your career, how that's then shaping your planning given the fact that you go back to what you have said a couple of times here, with luxury being a long term play?

MARC METRICK: And I think, look, that's what really is going to separate the folks that are very successful through the folks that might not be as successful. And that's what we did during the pandemic. And that's what we're going to do now. It's about staying committed to your strategy. And obviously, you've got to manage through the near term, but it's staying committed. And that's one of the lessons I learned at Saks. You can't pivot for the near term. You've got to move forward. And you've got to drive-through it. And you've got to do it smart. But you've got to stay very, very focused.

BRIAN SOZZI: Marc, are you still an active talks with the folks at Neiman on a transaction?

MARC METRICK: I got to read that in the paper. I'm not sure. Right now, I'm on active talks with just driving my business and focusing on that. And I'm going to-- I'm going to let all those rumors be all those rumors.

BRIAN SOZZI: Do you think in the same boat, you have to be seeing what's happening over Macy's. There's reports today that Sycamore might be making a play. Do you view Macy's as distracted competitor as it looks to potentially go through a process like that?

MARC METRICK: No. I think, look, again, I try to focus on Saks and what we're doing. And I think the guys at Macy's know how to run their business. And I don't think it's going to be that type of play. But again, for Saks, we want a stable retail environment. We want folks to be focused. We want everyone to be moving for the consumer. And that's what I'm hoping for next year.

BRAD SMITH: What would check the boxes for you, Marc, as an additive element that another business, if you were looking at any type of acquisitions in 2024 should and could bring to Saks?

MARC METRICK: Again, you know, it's a matter of fit, it's a matter of making sure that it's not going to be too much of something that you need to digest. But I'm not doing a lot of thinking about absorbing or combining or doing that kind of work again. It's about the strategy. It's about doing what we need to do. And we got to work through that. That's priority 1, 2, and 3.

BRAD SMITH: Marc Metrick who is the Saks CEO and Yahoo Finance's Executive Editor Brian Sozzi joining us here for the conversation. Thanks so much for the time this morning.

MARC METRICK: Thanks. Happy holidays, guys. Brian, call me later.

BRIAN SOZZI: I appreciate it.