Now that we’ve had a few days to digest the recent European Chanel price increases, some truly startling facts begin to emerge. In comparing the price of an Hermes Birkin 30 and Chanel Maxi it appears they’re moving closer to parity than anyone anticipated.
Ready for the bombshell…
The premium on the Birkin 30 is now only 9.2% over the Chanel Maxi! As of January 2020 the price of a Togo Hermes Birkin 30 was €7750 (*assuming no further increase since*) while the Chanel Maxi, taking into account last week’s (*May 11th, 2020*) price increase is €7100.
For most of the past decade these two bags and brands were hugely divergent in price. But over this period, Hermes consistently increased its prices by only a small percentage each year. Chanel, on the other hand, sometimes hiked prices up to twice per year at a much higher rate. Add to that the recent massive price spike for Chanel, and the Birkin Premium seems to be rapidly declining.
Those familiar with financial analysis will know that a premium or discount is the percentage difference between one goods value and another. So in simplest terms, the Birkin Premium refers to how much more expensive the Birkin is compared to other bags. The Premium does not take into account the brand exclusivity or difficulty in acquiring a Birkin over another bag.
Birkin Premium is calculated as follows:
To find the Birkin Premium for any bag, use the following formula: (Birkin Price – other bag’s price) / other bag’s price.
In 2019, the Birkin Premium of an Hermès Birkin 30 over the Chanel Maxi was 21.7%
(€7550 – €6200) / €6200= 21.7%
Now in 2020, the Birkin Premium of an Hermès Birkin 30 over the Chanel Maxi is only 9.2%!!!
(€7750 – €7100) / €7100 = 9.2%
For so long and for so many, the Hermès Birkin is the ultimate holy grail handbag. Chanel is right up there in the coveted department, but it is the elusive Birkin that claims a place in media, movies and the general purse zeitgeist. People dream of a Classic Chanel flap… but they fantasize about owning a Birkin.
Chanel enthusiasts take heart that the sticker value of your Chanel classic is inching closer to your friend or frenemy’s Birkin. For those who scoff at shelling out Hermès level amounts for a bag and gravitate toward Chanel… the price argument should now carry less weight.
With that in mind, let’s take a look at the numbers:
Chanel versus Hermes Pricing in Euros as of May 11th, 2020:
|Luxury Handbag Model||Prices (Euros) as of 2019||Prices (Euros) As of 2020||Price Increase||% (Increase)|
|Hermès Birkin Togo 30||€7,550||€7,750||€200||2.6%|
|Luxury Handbag Model||Prices (Euros) as of 2019||Prices (Euros) As of 2020||Price Increae||% (Increase)|
|Hermès Birkin Togo 30||€7,550||€7,750||€200||2.60%|
Complete Chanel price lists can be found here: New Prices 2020
The difference between purchasing these two bags is now only €650! Think about that for a moment: The Hermès Birkin is only €650 more expensive than the Chanel Maxi today: €7750 (B30) – €7100 (Chanel Maxi) = €650!
So with the Birkin Premium now lower than it’s ever been in recent history, when you land in Paris, are you heading to Hermes or Chanel first?
We will continue to keep you posted on the rapidly evolving prices in the luxury handbag market. We’re hard at work researching the historical context behind these recent price increases…stay tuned!