- Designer bag prices have risen in the past few years amounting to high costs
- Just this year, Chanel announced a six to eight per cent bag price increase
- Price increases beg the question – who can even afford designer bags anymore?
Just over a decade ago, owning a medium classic Chanel flap bag seemed like an attainable feat.
Although still luxurious, it was something to work towards, especially after a long time of saving up bi-weekly paychecks or even that yearly bonus – and it could be done for the price of $1,650 in 2005 or $2,850 in 2010.
But since then, the price of a medium flap has nearly tripled meaning that, with a freshly announced price increase, the purse will now set you back a shocking $10,800 in 2024, according to Sotheby’s.
That’s already up six per cent from $10,200 just last year, per data collected by Sotheby’s – a whopping $7,950 increase from just over ten years ago.
And that’s just a baseline.
The brand’s cult-favorite Boy Bag style has had an increase of over four per cent, while the Chanel 19 Large Bag saw a whopping 7.4 per cent increase, going from $6,800 to $7,300 in just one year, per Purse Blog.
Just last month, consumer prices in the United States rose three point five per cent.
That means Americans need an extra $11,400 a year to afford the same quality of life they were enjoying years prior – but a Chanel bag and other designers goods now cost more than that.
But Chanel isn’t the only designer that has steadily increased its prices in recent years, either.
The cost of designer goods at brands like Hermès, Louis Vuitton, Prada, and Dior have all gone up too.
While a classic Louis Vuitton Neverfull purse once cost $870 in 2012, it increased to $2,030 nearly ten years later in 2023, per Sotheby’s.
In 2018, the ever-popular Dior Book Tote cost $1,900, but now, nearly six years later, it’s $3,450.
And, Goyard, the ultimate ‘quiet luxury’ brand, implemented a change to their color system in 2022, which caused a 26 per cent price increase for their black Goyard St Louis PM, according to Sotheby’s.
With all of these extravagant markups, it begs the question – who can even afford designer bags these days?
Chanel has always been favored by celebrities including Kris Jenner, Margot Robbie, Meghan Markle, and even the mommies of Madison Avenue, but what about everybody else?
Interestingly enough, people are still buying.
During the fourth quarter of 2023, Hermès sales rose by 17.5 per cent, per Reuters.
Luxury group LVMH, which owns Louis Vuitton, among other luxury brands, reported an eight per cent increase in profit last year, Drapers reported.
Judy Taylor, CEO of luxury resale company Madison Avenue Couture, told DailyMail.com that the clientele for designer bags is still a mix of the wealthy and those who aspire to be.
Both social sets ‘understand the value proposition of buying these bags, wearing them and selling them for close to the original purchase price when they tire of them or need the money,’ Taylor explained.
‘That being said, Chanel and Hermès do tend to target the wealthy since they can also afford to buy other items such as clothing and jewelry,’ Taylor added.
The luxury goods expert also shared that wealthy people are ‘more resilient to outside economic factors,’ which means their buying patterns differ from those who buy in an aspirational sense.
‘While the aspirational is a larger consumer segment, their buying patterns tend to have more volatility since they are more sensitive to economic uncertainty,’ Taylor told DailyMail.com.
According to celebrity stylist and personal shopper Rebecca Kahane, her clients are reaching for pre-loved Chanel bags instead of brand-new ones – and there’s been a ‘huge increase’ in Chanel shoe sales.
She’s also noticed a higher sense of urgency around certain items, because some are concerned that the prices will continue to rise or the bags will sell out.
But for Chanel, boxing some potential clients out of buying certain brand-new bags might just be at the forefront of their latest price increase.
‘The main goal is to make the brand more exclusive by making it inaccessible to the majority of people so the wealthy circle perceives it as a medal of wealth to carry around,’ leather expert Volkan Yilmaz, better known online as Tanner Leatherstein, told DailyMail.com.
‘Now the brand has been increasing its prices consistently for years with this goal, but it [has] started [to] seem significant as it [has] reached to a hard to grasp level matching Hermès price points,’ Yilmaz continued.
Though, Taylor still pointed out that buying luxury bags from Chanel or Hermès are safe investments, no matter who you are.
In particular, the protocols that Chanel has in place right now can make for a high return investment.
Currently, Chanel only allows a client to purchase one quota bag per month – and only two out of the potential 12 someone is allotted can be a classic flap bag.
So, when a particularly coveted collection from the brand drops, you may only be able to get your hands on one of the classic flaps, which will drive up the demand for resale of pieces from said collection.
‘When you return the next month to buy the other color, chances are it is sold out,’ Taylor explained. ‘You need to resort to the secondary market to get the other bag and pay a premium over retail.’
‘The most popular pieces sell out within one or two days a collection “drops,”‘ she continued. ‘Miss that drop and you covet a bag, you need to go to the resale market. Every time a bag gets more expensive, the premium goes up.’
But even a high resale ticket still leaves the designer bag customer base divided.
According to Yilmaz, a couple of things may start to happen to the market – including a larger demand for fakes.
‘Some people are more attracted because now these logos are more expensive and exclusive and that’s exactly what they want to buy,’ he told DailyMail.com.
‘But some people are driven away and choose the dupes as this gives counterfeiters to spend more money and charge more for better fakes,’ he continued.
Yilmaz pointed out that a well-made fake would also be hard to spot in ultra-wealthy circles, leaving ‘more reasons’ for ‘frugal millionaires’ to go with a replica.
He also noted that perhaps bags that have more of a ‘quiet luxury’ aesthetic surrounding them may eventually take place of today’s in-demand bags covered in labels.
‘There is a larger crowd realizing the luxury is all about logo and the prices are insane at this point, then they choose new quality, quiet luxury alternatives…’ he said.
Kahane agreed, explaining that many of her clients are reaching for brands like The Row, and are especially interested in their Margaux bag, which has been dubbed as the new Birkin.
She said it’s one of the hardest bags to source at the moment.
‘My clients are opting to wear less logos in favor of recognizable styles – “if you know, you know” – but otherwise under the radar,’ Kahane said.
‘Loewe, Celine, and Bottega Veneta are also in demand and easy to source.’
But still, it looks like Chanel isn’t going down without a fight.
Per Sotheby’s, Chanel prices are expected to rise once again this year.
Chanel’s CFO, Philippe Blondiaux, was recently quoted saying, ‘We usually revise our prices twice a year. That’s what we’ve always done and will continue to do.’