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| A Louis Vuitton pop-up store for menswear at Shinsegae Department Store in Seoul, August 2020 / Courtesy of Shinsegae Department Store |
By Kim Jae-heun
Luxury goods company Louis Vuitton raised prices for its products in Korea only just eight months after its last increase.
Unlike Chanel or Hermes that adjust prices simultaneously across all of their global stores, Louis Vuitton has been known to increase its prices only in Korea.
The increased prices were mainly reflected in local bestseller items.
The price for its small handbag "Pochette Accessoires," in particular, went up by 25.6 percent to 980,000 won from 780,000 won. The price for the smaller version "Mini Pochette Accessoires" also increased by 22 percent from 410,000 won to 500,000 won.
"It is exploiting people's psychology of revenge shopping by increasing prices for somewhat cheaper items, which are less of a burden for customers to purchase," an industry source said.
Due to the travel ban driven by the COVID-19 pandemic, many people have been spending more of their disposable income on luxury items rather than vacations or other common purchases affected by travel bans and social distancing.
As sales for luxury products have been soaring at local department stores, fashion houses have decided to jump on the opportunity.
Louis Vuitton raised prices for their handbags and clothing twice last year. In March, prices were increased an average 5 percent for most of the products, and in May, a further 6 percent for handbags and 10 percent for clothing prices.
As per its usual approach, the French fashion house did not notify customers of its price hike.
Louis Vuitton also did not clarify the reason for the price increase. But luxury firms usually state the reason for markup is in response to their headquarters' global pricing policy, a reflection of exchange fluctuations or increase of product cost or minimum wage.
Another French luxury brand Hermes raised prices for its handbags in Korea on Tuesday, following its markup in Europe on the first day of the year.
"There is also a chance that Louis Vuitton increased prices here to keep up with Hermes' pricing policy," the source said.
