WWD reports that a number of luxury handbag makers are lowering their prices due to the recession and customers' new resistance to constant price increases.
Cynthia O'Connor, ceo of Cynthia O'Connor + Co., a sales showroom that represents Kooba, Treesje, Botkier and C.C. Skye, among others, believes contemporary brands are taking a realistic pricing approach. "Two years ago, contemporary handbags were selling at $700, and $650 to $700 was a very average price to be. That's not our target anymore. We still have to offer some of those things-it just doesn't give enough depth to the collection if we don't-but we are trying to make the core lower than that."
Dean Khial, vice president of Southern California retailer Kitson, where bags average around $395, has noticed consumers expect more from their bags. "The bottom line is that the consumer wants value for the price," he says. "A lot of companies are making bags that are on the cusp of the trend for a much better price, and that has caused the majors to bring prices down. Most consumers felt they were overpaying before."
Melissa Richardson Akkaway, owner of Beckley, a boutique in West Hollywood, Calif., where Rebecca Minkoff, Lauren Merkin, and Lyla Black are the bestselling handbag brands and the average handbag price is $250, concurs. "The bag really needs to be special and on trend, and not too expensive where it's not a huge investment," she says.
Coach completely retooled all the price points for its bags last year and launched the lower-priced, youthful Poppy line. Different lines are taking different approaches: some are adding less expensive bags to entice the aspirational shopper, with the hopes that as her income increases she will buy the line's more expensive items. This is the approach that is working quite well for Tiffany's. Other brands are simply cutting prices a bit across the board. In any event, it's a welcome trend: handbag prices have been out of control for the past five years.
