Symbat Zhetpisbay | 26.12.2025
How A Luxury Brand Turns Craftsmanship into Profit
Chanel is one of the world’s most iconic luxury fashion houses, known for its timeless designs, exclusive boutiques and extremely high prices. Chanel products are a symbol of status and economic strategy that never burns out. However, behind that containment of success lies a clear economic pattern. Chanel has consistently raised prices and made its products harder to obtain. That's the catch that claims more attention than any other.
Unlike mass market brands that produce millions of units per year, Chanel tightly controls how many of its most coveted items are available in boutiques; similar to brands such as Hermes. This intentional limitation creates high demand and low supply, which leads to higher prices and greater perceived value. Even though it's a classic supply-and-demand economic strategy, it seems to work like a status magnet. In 2025, for example, Chanel raised the prices of its classic flap by about 4-5%, with the Medium Classic Flap retailing around $11,300 in the US, up from about $10,800 the year before. Even styles such as the Boy Bag saw similar price increases.
As many already know or at least have noticed, this isn't new here. Chanel has been increasing bag prices nearly every year since at least 2016. Over that time, the price of the Medium Classic Flap has doubled. It rose from approximately $4,900 in 2016 to over $11,000 by 2025. These consistent rises in its price basically explains why owning a Chanel bag feels harder than ever. The brand isn't making or selling units to meet the global demand, and it keeps dragging prices up to strengthen exclusivity and contain its long lasting prestige.
Between 2019 and 2025, some Chanel bags rose in price as much as five times faster than US inflation! This only shows that these are strategic pricing decisions, not simply cost of living adjustments; clearly, their prices have gone well beyond typical inflation. By raising prices more than inflation, Chanel reinforces the idea that its products gain value over time rather than just keep up with market trends. This also explains how they contain the title of being one of the most iconic and exclusive fashion houses.
That exclusivity has real consequences in the secondary market, also known as the resale market. Because Chanel keeps production limited and prices high, many older pieces have become valuable on resale platforms. For example, vintage Medium Classic Flap bags from the 1990s, which originally retailed for about $1,200, can sell for over $7,000 today. Some rare or collectible items, like limited-edition designs, can fetch even higher prices among collectors. In fact, a runway leather Shopping Basket bag recently sold for $152,000 at Christie’s, showing just how valuable rare pieces can become.
Resale trends show something important about Chanel’s economics. Products today can be worth a lot more in the future than their original price. This makes them feel less like ordinary goods and more like assets or investment pieces. Platforms in the luxury resale market, predicted to grow into the hundreds of billions globally, constantly cite Chanel as one of the brands with the highest value retention.
Of course, Chanel’s extreme pricing has drawbacks to it. In 2024, the brand reported a small decline in revenue and profit. The explanation was because some customers simply found prices way too high, slowing sales growth. Chanel still kept making investments in new stores and key markets in spite of that decline. This reflects Chanel’s consistent commitment to maintaining its premium status in the industry.
In conclusion, controlled supply, deliberate pricing, a strong brand identification, and resale economics all contribute to Chanel's premium and growing rarity. Chanel maintains its distinct status among other luxury brands by purposefully restricting availability and presenting its products as unique and durable. Chanel generates economic icons in the fashion industry that function more like investments than just accessories, in addition to selling bags and apparel.
Sources:
https://press.christies.com/christies-sets-new-world-auction-record-for-a-chanel-bag-at-152400
https://www.sothebys.com/en/articles/understanding-the-latest-2025-chanel-bag-price-hikes-and-the-resale-market
https://www.intoarchive.com/editorials/chanel-classic-flap-price-hikes-2019-2025
https://www.investors.com/research/the-new-america/realreal-stock-secondhand-luxury-market/
https://www.lemonde.fr/en/economy/article/2025/05/21/chanel-despite-a-drop-in-sales-in-2024-the-luxury-group-maintains-its-investments_6741484_19.html
Unlike mass market brands that produce millions of units per year, Chanel tightly controls how many of its most coveted items are available in boutiques; similar to brands such as Hermes. This intentional limitation creates high demand and low supply, which leads to higher prices and greater perceived value. Even though it's a classic supply-and-demand economic strategy, it seems to work like a status magnet. In 2025, for example, Chanel raised the prices of its classic flap by about 4-5%, with the Medium Classic Flap retailing around $11,300 in the US, up from about $10,800 the year before. Even styles such as the Boy Bag saw similar price increases.
As many already know or at least have noticed, this isn't new here. Chanel has been increasing bag prices nearly every year since at least 2016. Over that time, the price of the Medium Classic Flap has doubled. It rose from approximately $4,900 in 2016 to over $11,000 by 2025. These consistent rises in its price basically explains why owning a Chanel bag feels harder than ever. The brand isn't making or selling units to meet the global demand, and it keeps dragging prices up to strengthen exclusivity and contain its long lasting prestige.
Between 2019 and 2025, some Chanel bags rose in price as much as five times faster than US inflation! This only shows that these are strategic pricing decisions, not simply cost of living adjustments; clearly, their prices have gone well beyond typical inflation. By raising prices more than inflation, Chanel reinforces the idea that its products gain value over time rather than just keep up with market trends. This also explains how they contain the title of being one of the most iconic and exclusive fashion houses.
That exclusivity has real consequences in the secondary market, also known as the resale market. Because Chanel keeps production limited and prices high, many older pieces have become valuable on resale platforms. For example, vintage Medium Classic Flap bags from the 1990s, which originally retailed for about $1,200, can sell for over $7,000 today. Some rare or collectible items, like limited-edition designs, can fetch even higher prices among collectors. In fact, a runway leather Shopping Basket bag recently sold for $152,000 at Christie’s, showing just how valuable rare pieces can become.
Resale trends show something important about Chanel’s economics. Products today can be worth a lot more in the future than their original price. This makes them feel less like ordinary goods and more like assets or investment pieces. Platforms in the luxury resale market, predicted to grow into the hundreds of billions globally, constantly cite Chanel as one of the brands with the highest value retention.
Of course, Chanel’s extreme pricing has drawbacks to it. In 2024, the brand reported a small decline in revenue and profit. The explanation was because some customers simply found prices way too high, slowing sales growth. Chanel still kept making investments in new stores and key markets in spite of that decline. This reflects Chanel’s consistent commitment to maintaining its premium status in the industry.
In conclusion, controlled supply, deliberate pricing, a strong brand identification, and resale economics all contribute to Chanel's premium and growing rarity. Chanel maintains its distinct status among other luxury brands by purposefully restricting availability and presenting its products as unique and durable. Chanel generates economic icons in the fashion industry that function more like investments than just accessories, in addition to selling bags and apparel.
Sources:
https://press.christies.com/christies-sets-new-world-auction-record-for-a-chanel-bag-at-152400
https://www.sothebys.com/en/articles/understanding-the-latest-2025-chanel-bag-price-hikes-and-the-resale-market
https://www.intoarchive.com/editorials/chanel-classic-flap-price-hikes-2019-2025
https://www.investors.com/research/the-new-america/realreal-stock-secondhand-luxury-market/
https://www.lemonde.fr/en/economy/article/2025/05/21/chanel-despite-a-drop-in-sales-in-2024-the-luxury-group-maintains-its-investments_6741484_19.html
