Are Handbags No Longer Big Business for Luxury Brands?

In recent years, it seems the once untouchable title of the “It” Bag has been redefined (read: Is the It Bag Era Over?). No longer solely associated with top luxury brands, “It” Bags often crop up in the form of more Instagram-friendly and affordable styles such as the Jacquemus mini which divided the handbag community earlier this year.

But what does the fall of the traditional “It” Bag mean for the future of luxury handbags and their importance to designer brands?

The Chanel Classic Flap, a well known ‘It’ bag. @thechicndamned

The Decline of Handbags?

Although certain luxury brands (and especially Hermès) are seeing immense success this year, things aren’t looking quite so good for luxury handbags. Once, handbags could be considered the bread and butter of a luxury brand. This isn’t so clear anymore…

Vogue Business reported this month that the total number of handbags introduced by luxury brands declined 33 percent in the U.S. last year. And decline exists on both sides—U.S. handbag sales fell 7 percent year-over-year to July 2019.

In addition, the amount of handbags offered by some luxury brands, in comparison to their other products, may strike you as surprisingly low. Hermès and Louis Vuitton’s offering of handbags make up well under a fifth of all their products for sale online that cost over $1,000 (see chart below).

Photo courtesy of The Urban Spotter/Blaublut-Edition.com. Data: Edited. Vogue Business

What’s the Reason for all of This?

So is the problem that handbags are losing their appeal? Well, not really! What’s going on is that luxury handbags now have more competition from newer and lower-priced brands. As we already mentioned, the definition of an “It” Bag has changed. A big reason for this, of course, is Instagram. (Isn’t it always?)

Social media has entirely changed our modes of consumption. Consumers today are exposed to an increasing number of styles more than ever before. Where “It” bags used to hold consumers’ fascination for years, as in the case of the Fendi Baguette, they are now popular for a shorter amount of time. (Case in point: The Gucci Dionysus, which has largely fallen off the radar in the last year or so.)

Instagram-savvy shoppers tend to prefer the affordability of other lesser-known luxury brands because it allows them to keep up with new trends. Traditional brands just don’t hold the same weight as they once did. (Read: Luxury in the Age of Millennials)

The Fendi Baguette is known for being one of the most iconic “It” Bags of its time. @nettiweber

“Classic ‘It’ bags have long-lasting value, while more trendy ‘It’ bags have a shorter lifespan,” Sasha Skoda, The RealReal’s head of womenswear, told Vogue Business.

Once exclusively luxury pieces, “It” bags are now considered to be any bag that has captured the love of the mass market. So often buzz is generated through Instagram—just look at the Jacquemus mini or Bogetta Veneta’s The Pouch.

The Jacquemus Le Chiquito bag which divided the handbag community. Photo courtesy of Christian Vierig/Getty Images

Bottega Veneta’s The Pouch, declared the “It” Bag of summer 2019 by fashion critics. @rosiehw

A New Direction With Jacquemus

Of all the newer brands popular on Instagram, one certainly stands out. Founded in 2018 when French-born Simon Jacquemus was just 20 years old, the Jacquemus label has seen great success and managed to establish itself as a brand to watch in a relatively short amount of time.

Jacquemus’ cool and quirky designs fairly quickly found popularity with the influencer, street style scene. Whether you love or hate their mini (and now even micro!) bags, there’s no denying that the buzz online certainly got the Jacquemus name on people’s lips. (Read: The Mini Bag Goes Microscopic at Paris Fashion Week)

Photo courtesy of WWD/REX/Shutterstock

@jacquemus

What About the Traditional “It” Bags?

With influencers tempting us with the “latest of the latest” styles everyday on IG, is it really a surprise that many consumers no longer jump at the thought of spending thousands of dollars on a single bag branded the “latest thing” when it is likely there will be a new latest thing a month later?

Admittedly, famous “It” Bags such as the Fendi Baguette and Dior Saddle Bag that made a comeback in recent years sold well. However, they haven’t enjoyed anywhere near the level of success they received when first launched.

The Dior Saddle Bag made a comeback recently. @flawednfabulous

Moreover, the resale value of more recent “It” Bags like the Louis Vuitton Petite Malle is declining. According to The RealReal, in the year the bag launched it held 80 percent of its value on the resale market, but this dropped to 60 percent the following year.

The Louis Vuitton Petite Malle. @mrs_thatmountain

The Future of Luxury Bags

So how will this effect the future of luxury handbags? The truth is only time will tell. However, it’s worth noting that IG is still very much in its infancy when it comes to its foray into the fashion world. Hence it may be premature to declare the iconic “It” Bag status dead or altered permanently.

In the future, consumers may grow tired of trying to keep up with trends on Instagram, and long once again for a bag whose appeal is everlasting (or at least one that can maintain its buzz for longer than a scroll through your social media feed).

Let’s just say we’re not going to let go of our love for the Fendi Baguette, Dior Saddle Bag or Chanel Classic Flap just yet!