The Macklemore Effect: Reason Why Teen Retailers are Doing so Poorly?

Well I sometimes listen to current music and I keep hearing a song which is about a year old called Thrift Shop by Macklemore & Ryan Lewis. The song is pretty much about a guy with $20 in his pocket and how he is getting that money to stretch when he is buying clothes for the club. One line that I really liked in the song was.


“Oh that Gucci, that’s hella tight”
I’m like “Yo, that’s fifty dollars for a t-shirt”
Limited edition, let’s do some simple addition
Fifty dollars for a t-shirt, that’s just some ignorant bitch shit
I call that getting swindled and pimped, shit
I call that getting tricked by business.

With recent bad comps from teen retailers I wonder if there is some sort of dim and tenuous of correlation between the two.

On Monday, teen retailer American Eagle Outfitters Inc. slashed its second-quarter outlook because of weak traffic and sluggish sales of women's merchandise. The teen retailer cited a highly promotional environment that only got tougher in July. 

On Thursday, rival Aeropostale Inc. warned that it would have a wider loss than expected when it reports its second-quarter results later this month. It also blamed weak traffic and lots of discounting. 

It would be interesting to see if Thrift Stores are actually picking up sales on deep discounted clothing as young people with only $20 in their pocket make their money stretch. Well it seems to be the case at least in some parts of the country.

“Once you find something great,” explains Porter, “you’re hooked. I’ve always shopped at garage sales and thrift shops. Your money just goes further.”

In fact, one of her friends was reluctant to shop thrift stores until she scored a $200 pair of designer jeans for just $11. Porter’s biggest coup was finding a Louis Vuitton bag in near mint condition for $10. She estimates it is worth close to $200.

“You can find really good brands,” says Porter. “I found a North Face jacket for $10 on Goodwill’s half price day and a New York & Co dress that I wore to Cotillion and Winter Formal for $15.”

I think young people are just getting more frugal on certain things like clothes and there is no stigma attached to shopping at Goodwill anymore. $50 for a T-shirt is just not something that teens are rushing out to pay anymore.

Also the idea of treasure hunting at a thrift shop might be drawing in some people as well. Getting a Louis Vuitton bag for $10 would make quite a few women very happy if they found such a deal by digging through a bin. The Great Recession plus record student loans might make a much more frugal Gen-Y is we are lucky.