Chanel continues to increase the price of its bags to gain exclusivity

Chanel has been increasing the price of its bags in recent years and with the arrival of COVID-19, the luxury company was also forced to raise the price of its products to counteract the drop in demand. In fact, Chanel has increased the value of its bags at least five times since the pandemic began.

The Bloomberg agency reported that "the increases are in response to unspecified exchange rate fluctuations, changes in production costs and to ensure that their portfolios cost approximately the same around the world," according to a company spokeswoman.

However, analysts and industry executives consider the volume increases to be "an aggressive corporate strategy." According to data from Kathryn Parker, an analyst at Jefferies Group, in the United States the value of Chanel's small classic flap bag has increased 60% to $8,200 since November 2019.

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She also pointed out that with the new price increase, the large version of the bag now costs $9,500 in the US, up from $7,400 previously.

For his part, Charles Gorra, executive director of Rebag, thinks that the increase in prices in handbags may have the purpose of making Chanel products even more exclusive in order to compete with the handbags of its rival Hermes.

Other exclusivity measures

In order to make the products more exclusive, the brand has decided to control the number of bags that customers can buy in a given time.

According to a sales assistant of the luxury company in Paris, the consumer can only buy one bag at a time and to buy again they must wait approximately two months, however, the bag cannot have the same characteristics as previous. Bloomberg also reported that in New York there were monthly limits on buying vintage bags.

Chanel's purchase limits and price increases are "like telling consumers that if they can buy a bag, they belong to the club," said Gachoucha Kretz, an associate professor of marketing at the HEC Paris business school.

Finally, it should be noted that all these actions of increases and limits have generated discomfort among consumers in various parts of the world. Some repeat customers have said that they now prefer to buy other brands.