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Is Luxury Too Expensive?

Sale PSA: A pretty tie waist dress from Vince, now 60% off, super cute T-Bar brogues from CdG x Doc Martens, now 50% off, a lovely gingham dress from Ace & Jig, now 40% off, a very pretty linen sweater from Uniqlo/Ines de la Fressange, now just $15.

So this week (and on this lovely Memorial Day) I was actually going to review some new purchases. Yes, I finally started shopping! However they all were disasters, the worst being a Zara dress which made me look like Mrs. Doubtfire (or I wish). And it just happens that I read this article, via Business of Fashion, about whether luxury is too expensive – it kind of stuck in my head and so I’d like to talk more about that today instead!

Something has changed for me during Covid. I am willing to pay for my material indulgences, am actually willing to pay more in many cases – but I want to know where it is going. Extra tip at my favorite restaurant? Yes. Full price for a brand that I support (like in my post on Elizabeth Suzann, where you know it is going back into the local community)? Yes. Luxury at a huge markup where most of it is going into a conglomerate’s coffers and the rest into fashion shows and giving away hundreds of bags to influencers (yes! hundreds! A kind reader has shared with me the gifting budget for an anonymous AND highly coveted brand and you really don’t want to know!!).

Anyway, my answer there is….no (with some caveats). No, I don’t think I want to pay those huge markups anymore. Pre pandemic I was already getting off that bandwagon (kids get everything dirty, have to pay for college, etc etc) but after Covid I think I’m more or less off the ride.

Then… I heard about Chanel having price increases…my God!! And Louis Vuitton too, apparently? I wonder what the rationale is because I don’t see how that works out given the economy? Is it some kind of long game (if you have an intelligent answer and/or theories please share!). Because obviously I don’t think these brands are stupid, and they have managed to separate me from quite a lot of my money over the years, and so they must know something I don’t! And yet it seems kind of tone deaf…but what do I know??

But then I start to think about why I care at all. And I shouldn’t! It’s the marketplace’s job to dictate supply and demand and so it’s gone too high for me and I’m sitting out. Though I don’t want to say FOREVER g…there are soo many lovely memories I have attached to certain items, accomplishments, etc. And honestly, I think if you’ve been dreaming after a classic flap, or wallet on chain, or some other item – I still think it is worth it if you can afford it. Because you’ll get so happy when you get your dream. There are still quite a few dream items I’d one day like and I’m sure I’ll be happy when I get them too.

But for now…in terms of those impulse luxury purchases…I’ll be watching my wallet far more closely now. And thinking about where all that extra margin goes (I still love Hermes but the day that Hermes starts widespread gifting I think will be my personal doom). And PLEASE share your thoughts! Is luxury in general too expensive? And what do you think of the recent price increases?

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22 Comments

  • Reply
    adguru101
    May 25, 2020 at 11:11 am

    I agree with you, and I’m off the bandwagon too — though never say never. At this point, if I wanted a bag, I’d buy secondhand. I feel that price increases at this time for Chanel and LV are not only insensitive but make me feel I don’t want to be identified with brands that display such a crass level of corporate greed… because you know the profits are not going to the skilled artisans who actually make these items!

    I hope we see a huge rejection of this approach as we are all learning to embrace simpler and more meaningful values. This isn’t to say I don’t enjoy my materialism; but I truly have enough stuff to last me the rest of my days. And who in hell are we showing off for, anyway?

  • Reply
    Dee
    May 25, 2020 at 12:07 pm

    As always, enjoyed reading your perspective on these topics. I struggle and straddle the fence on luxury. I believe, moving forward, I will just focus on purchasing from the preloved market on items from brands who I feel the craftsmanship had slipped over the years and save for a new item from certain brands, like Hermès, for special milestones.

  • Reply
    Liz | wannabeliz.com
    May 25, 2020 at 12:36 pm

    I stopped buying top tier designer bags years ago. I purchased a Kelly bag years ago for 5k. Back then, that was considered super pricey. A Chanel jumbo classic was a little under 2k. I should have bought two! I stopped because most all of these bags cost as much if not more than 18k jewelry! I change jewelry more often than bags. I love, love designer shoes. Sadly, people spit in the street, among other things. I do have a few really nice shoes that I bought years that I wore for Family outings. Someday, I would love a jumbo classic. I think I’d buy it used though. I would have to feel right about the authentication because used are very expensive too. Has anyone noticed how expensive fragrances have become?

  • Reply
    Rich
    May 25, 2020 at 1:01 pm

    Do I smell desperation? The ultra rich will love the price increases. Less likely to see themselves. The question is can they carry the higher % of the load. VERY INTERESTING

    • Reply
      Kat
      May 25, 2020 at 2:34 pm

      Is that what I’ve been smelling?? I’m full of it!

  • Reply
    Nina
    May 25, 2020 at 2:48 pm

    Now I am super curious about the doubtfire dress!

    • Reply
      Kat
      May 25, 2020 at 5:26 pm

      https://www.zara.com/us/en/printed-rustic-dress-p07521044.html?v1=47515760&v2=1446510

      yes….I should have known lol

      • Reply
        Lilian
        May 25, 2020 at 10:49 pm

        Kat, that dress is NOT forgiving in any sense of the word. There’s so much going on here with the frills, lace, tiers, I cannot. You look exquisite in dresses, and while I’m sure you can pull this one off, there’s something very “It’s a no from me, dawg…” about this particular number.

      • Reply
        Nina
        May 26, 2020 at 5:37 pm

        haha it’s cute! but I can also see it being hard to pull off for us petite people : )

      • Reply
        Rachel
        June 7, 2020 at 10:10 am

        Haha I got this dress too after seeing all over Instagram. It definitely isn’t flattering but I kept since I’m not seeing anyone but my family anyway 😉

  • Reply
    Diane W.
    May 25, 2020 at 3:43 pm

    Even before Covid, I’d entered a divesting stage. The past two months have solidified the belief that I’m heading in the right direction for my future. It applies to all the material categories in my life where I tend to splurge: jewelry, bags, and even art. Although I’d already begun giving things away, my personal litmus test was when I stopped buying new art. Previously, if I gave away a painting, it was because I was making room for a new piece. I feel I’m finally off that treadmill. It feels good although some of the decisions are difficult. However, it’s getting easier as I build momentum. Although some things are already gone, I’m considering photographing the more difficult items to remind me of my progress.

    I’ve toyed with minimalism for several decades. But now that I’ve given my huge antique wooden Buddha to a friend, I know I’m going to be able to go the distance. Finally.

  • Reply
    Lilian
    May 25, 2020 at 10:46 pm

    Yes. Yes, it is. And the resale value of most of these items is almost criminally low. For the past couple years, I’ve bought pre-loved bags, clothes and shoes. I grew up wearing pre-loved, and it feels good to save so much.
    My HG bag for the longest time was the LV Noe – over ten years’ worth of gawking at it online and gasping at the price increases (and yes, had I bought it all those years ago it’d be gorgeously patina’d and I’d have paid a fraction of what it costs now).
    I bit the bullet this Mothers’ Day and bought the Noe in Epi, pre-loved. It arrived in record time, and is in pristine condition. Less than half what I’d have paid for the monogram one I’ve always wanted. If I run into a mono version pre-loved that sings my name, I’ll get it, and gift this one to my baby sister. She already took my new-to-me one for a spin and loves it even more than I do.
    *also Chanel and LV are ghouls for raising prices in this environment. Ridiculous!

  • Reply
    Matilda
    May 26, 2020 at 12:13 am

    My opinion? It’s incredibly sad that it takes a deadly virus to get humanity to finally “see the light”
    Just very very sad that you are living in this world and willing to pay money for a friken bag so that proceeds go on giving away more bags. When there are people needing home shelter water and food. Buy something that invests in to that instead. How much more material crap to fill an emotional void do you need and how are u not saddened to live in the world that is suffering and think about buying Hermes bag?
    It’s just an embarrassment at this point.
    Humanity is dead asleep.
    Well maybe a few more viruses will wake ya LL up.

    • Reply
      Kat
      May 26, 2020 at 10:25 am

      My emotional void is vast and deep!

  • Reply
    Anonymous
    May 26, 2020 at 3:07 am

    The salespeople at the Chanel boutique will tell you that the bags are expensive because it is meant for the ultra rich. “You don’t want the person next to you having the same bag.” Have a handbag that is “sold” out to one customer? Remember the recently coveted iridescent pink bag of last season? Guess what? Come in with a Chanel purse and do a little chat with a sales person, and that bag is available for you…but it was “sold out” to the other person right next to you. Yes, luxury stores are not equal for the average. And it down right sucks. Remember the recent $1,800 Stimulus checks for the U.S. …well the ultra rich (people who make $1 million annually) have a stimulus check for $1.7 million. Yet, no one speaks of this in the news. Average people only complain for Chanel and other luxury brands raising prices. Perhaps these luxury brands are targeting this 1% demographic.

    https://www.google.com/amp/s/www.forbes.com/sites/shaharziv/2020/04/14/why-are-rich-americans-getting-17-million-stimulus-checks/amp/

    Death toll is rising, and people are told to reopen and people come flocking to stores and beaches .. asymptomatic people be damn. Lol. Logic goes out the door.

  • Reply
    Michelle
    May 27, 2020 at 7:03 am

    I’m in Zurich and ever since the shops opened up two weeks ago there have been lines down the street all day long, every single day for LV and to a lesser extent Cartier and Chanel. It’s crazy… often the lines are 30 or 40 people long, no matter the time of day. I wonder if it’s the fear of a price increase that has people standing so close together during a pandemic?

    I guess I’m just struggling to understand why this would be the first thing you’d do after exiting self isolation?

    I love my designer bags but I’ve had no desire to buy a new one in the last Sox months and can’t really understand these huge queues.

    • Reply
      Kat
      May 27, 2020 at 7:48 am

      Wow this is so interesting! Thanks for sharing the perspective.

  • Reply
    Pret A Porter P
    May 27, 2020 at 7:06 pm

    While I do own luxury goods, I do not consider myself a luxury consumer. I was always under the impression Chanel, Hermes, etc… raise their prices 1-2x a year anyway. The prices of luxury goods are obscene, they always have been and are supposed to be. There’s no way a handbag even if made by hand by blind Tibetan monks in the Himalayas only during a full moon is worth more than say a car or even a house that actually DOES things. As long as someone is willing to pay for it, the brands will charge whatever they want.
    Also I work in luxury retail, so I see the behind the scenes of how these bags arrive in shipment and how they are thrown around, shoved into drawers, scratched and damaged before they even go on the sales floor…It certainty erases this aura that these bags are so precious and sacred.

  • Reply
    Nora
    May 28, 2020 at 7:01 am

    I observe the same with my spending behavior. However, I’m convinced that my pre-C19 me will ultimately come back. Maybe not as intense as before and not promptly. But I think it’s part of who we are and our individual preferences. Part of my preferences is definitely that I like nice and luxurious things. C19 probably came like a shock that made us all re-think who we are and our behaviors. But I don’t think that this shock alone will change us completely in the long run.

  • Reply
    Mo
    May 28, 2020 at 11:04 am

    I am a tenure-track professor at a big ten business school and I have been following your blog for years (??) at this point (definitely started while I was in grad school) because I got interested in this phenomenon of “luxury”. Luxury to me is feeling comfortable and at peace and being able to spend on people and causes that I care about without feeling guilty or constrained. I don’t associate “luxury” with items. In fact the word “luxury” when applied to the act of purchasing a bag is an oxymoron. There is nothing luxurious about having to think ten times before buying something. The whole point of luxury is to be able to do something WITHOUT having to think twice about it or feel guilty about it. This is nothing but the clever marketing of firms’ differentiation strategy; they want to create artificial scarcity of products and raise customers’ willingness-to-pay. I don’t think these bags that you talk about are scarce AT ALL. Don’t the lines outside Hermes in Paris go for blocks sometimes? Aren’t there blogs and blogs on how to save VAT when you buy a Channel in Paris? These are not scarce items when every 25 year old saves up for a year and go to Paris to buy their first Channel. In fact, there’s actually something quite herd-like about it – the very opposite of luxury. These bags are ubiquitous. Many of my students come to class in Manolos and their Gucci slides for their final presentations and many carry the kind of purses you talk about – the LVs, and the Channels with the customary Hermes scarfs wrapped on the handles etc. The boys come in their Monclers and their fancy sneakers that I don’t even know the names of. I’m sure their mothers all carry the Kellys and the other distinguished members of the H family.
    Just FYI, while I would never pay for any kind of “brand” that you feature here on this blog I do and would continue to pay for private elementary and middle school for my children. I’d also give generously to election campaigns and organizations whose beliefs are aligned with my own. And I’d pay through the nose for personal trainers to come to my house and make sure I stick to my workout three days a week. So I don’t buy “luxury” bags because I can’t afford them. I don’t buy them because there is nothing “luxury” about a bag that defines one’s worth in society.

    • Reply
      Kat
      May 28, 2020 at 3:16 pm

      A valuable and interesting perspective (and thanks for reading all this time!) That being said I think to each their own as to what is luxury which I think is your point – as obviously others might say the same for private trainers, school, etc – it is their own choice to determine their utility.

  • Reply
    Rachel
    June 7, 2020 at 1:14 pm

    Great post and discussion in comments. The BoF article linked to another about “premium mediocre” which was really interesting as well.
    I think it’s too early to tell the lasting impact COVID will have on my personal relationship with luxury goods. Not only am I not currently interested in acquiring any more, I don’t feel comfortable wearing a kelly bag or Gucci slides out now given all the serious things on people’s minds – health, racism, financial challenges, etc. Will that change in a few months or years or never? Who knows. It does seem a little silly to look at those things in my closet now, but they brought me joy in the past and may again.
    I will say for me the ultimate luxury has always been travel, even more so now that we can’t travel. I am so appreciative that I spent so much time and money on travel when I did. The photos bring me great joy and I love remembering or telling my kids about our grand adventures. Hopefully a time will come when it’s safe and enjoyable to do so again.

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