After Chanel's Open Run, Louis Vuitton and Hermes Also Raise Prices... "Twice a Year Increase is Standard"

Luxury Industry Considers Year-End and Early Year Price Increases... Chanel Leads
Louis Vuitton to Raise Prices This Month... Hermes Early Next Year

Last May, citizens lined up in front of the luxury goods hall at the Lotte Department Store main branch in Jung-gu, Seoul, trying to purchase Chanel products.
[Image source=Yonhap News]

[Asia Economy Reporter Lee Seon-ae] The luxury industry is gearing up for price hikes ahead of the year-end and New Year sales season. It has been confirmed that many luxury brands are setting detailed guidelines on which items will see price increases and by how much, suggesting that Chanel's open-run (the act of rushing to buy items as soon as the store opens) is expected to continue.

According to the luxury industry on the 12th, price increases for Louis Vuitton, considered one of the top three luxury brands along with Chanel, are expected soon. On luxury community forums, information is being shared that Louis Vuitton store employees have indicated that price hikes are imminent. The industry expects price increases to be implemented as early as this month. Along with Chanel's price hike, Louis Vuitton is also expected to see open-run events.

Before Chanel's price increase on the 2nd, open-run events occurred at major department stores housing Chanel stores, with customers rushing inside as soon as the stores opened, almost like a race. In particular, more than 100 meters of people lined up from early morning waiting to enter in front of Lotte Department Store Avenue in Sogong-dong, Seoul. Chanel's price increase this year is the second one. In May, the prices of major products were raised by about 20%. Chanel Korea explained that this increase was "to adjust price differences between countries according to exchange rate fluctuations."

If Louis Vuitton raises prices this month, it will be the third time this year. Louis Vuitton implemented price increases in March and May of this year.

Herm?s, ranked as the number one luxury brand, will also raise prices early next year. Herm?s has no plans for additional increases within this year but has stated that it will review its pricing policy for next year within a few months, making a price hike at the beginning of the year highly likely.

In addition to Louis Vuitton, brands owned by the LVMH group such as Dior, Fendi, Givenchy, Celine, and Bulgari are also preparing for price increases next year. Especially for Dior, which raised prices in July and September this year, a price increase early next year would mean another adjustment within six months.

Changes are also being detected in the luxury industry's price increase strategies. Instead of adjusting prices for all items once a year, brands are adopting a strategy of raising prices two or three times a year, focusing on certain products. The luxury industry believes that this frequent adjustment strategy can actually maximize the Veblen Effect. Hong Hee-jung, a senior researcher at Euromonitor, analyzed, "Luxury brands raise prices every year because product prices are directly linked to brand value for consumers, so they increase prices. Price increases become an act of enhancing brand value."

This content was produced with the assistance of AI translation services.