The dark side of the Walmart 'Birkin,' Zuckerberg's $900k watch, and luxury's EU-China problem
Plus: Louis Vuitton’s retro price hike
Dear Dark Luxury readers,
Welcome to the first of our Wednesday news round-ups which we’ll be sending in addition to our more deeply reported stories on Fridays. We have many more stories on the way, all funded by readers willing to pay for in-depth reporting on the dark side of the luxury industry. We have no PR budget and so far we’re relying entirely on word-of-mouth and the occasional LinkedIn and Instagram post (follow us!).
Later this week we’ll be reporting on changes at the British Fashion Council, the body which organises London Fashion Week and which is meant to promote British fashion designers. Next week, we’ll be in Florence, reporting on market moving news and views (and gossip) at the 107th iteration of Pitti Immagine Uomo, the menswear industry’s number one trade fair. Drop us a line if you’ll be there too.
Conrad and Alfred
Mark Zuckerberg’s $900,000 watch
Which PR person failed to advise Mark Zuckerberg that it might be a bad idea to announce he was “getting rid” of the work of 40,000 moderators while wearing a $895,000 watch?
See the video for yourself and you’ll see the unbelievably rare, hand-made Greubel Forsey “Hand Made 1” on his wrist. The watch is not only hand-made, but its parts are produced exclusively with hand-operated tools. Each model reportedly takes 6,000 hours to make, the equivalent of three years of work for a single person. As Adam Smith once said about wealth, “a person must be rich or poor according to the quantity of labor which he can command.” Mark Zuckerberg wears this statement on his sleeve.
Leaving aside this radically authentic demonstration of extreme wealth, the changes to Meta’s platforms could profoundly affect how the luxury industry sells its products. If the removal of fact-checking on his platforms results in an increase in the quantity of dangerous or illegal content appearing on his platforms, luxury businesses are presumably less likely to spend as much money with Zuckerberg’s business.
Luxury brands are already annoyed at the prevalance of dupes, fake luxury products and “brand-unfriendly” content on Meta’s platforms. Might some of these brands take their billions worth of advertising spend elsewhere? Then again, this move probably wasn’t about profit maximisation.
Calculating Louis Vuitton’s retro price hike
Louis Vuitton’s reissue of the colourful Takashi Murakami handbag, which is already selling out in some places, offers us yet another example of wildly excessive handbag price inflation.
The original pochette handbag sold for $450 back in 2003 in the US, which is about $772 today if you account for inflation. The same reissued pochette handbag is now selling for $2,100, a 367 per cent increase.
Hermès’s latest price rises
Hermès has put up the prices of its handbags by between 4.5 percent and 8 percent in Europe and the US, according to PurseBlog. Price hikes have happened at the company every year since 2020, and escalated as inflation kicked in from 2022. This year’s hike is well above average rates of inflation in the US and Europe, currently around 2.6% and 2.2%, respectively.
Daily and travel bags had the biggest price hikes, with the “daily” Herbag Zip Cabine bag, made of cowhide and canvas, now 12.65% more expensive than it was at $4,675. The price of the rather plain canvas and leather Garden Party 49, “now designed for men,” is up by 12% to $5,600.
The largest absolute price increase was for an exotic skin bag, the Mini Kelly II in matte alligator. It’s up 7.5 percent from €27,900 to €30,000, more than three times the price of the next most expensive Mini Kelly II in leather, demonstrating the extraordinary selling power of these exotic skinned bags.
Hermès CEO Axel Dumas is under pressure to remove exotic skins from its line-up amid accusations from Peta, which says the animals are kept in cramped enclosures. Up to three alligators are killed in cruel ways to make each handbag, according to the animal rights group.
Peta invited Dumas to visit alligator farms which supply the business at last year’s annual shareholder meeting. Other major brands have already removed the material from their line-ups. For now, the exotic skins are not only staying on sale at Hermès, they’re getting even more expensive.
The dark side of the Walmart ‘Birkin’
Consumers went wild over the Christmas period for the Walmart Birkin dupe, nicknamed “the Wirkin,” which can sell for as little as $78. Produced under the brand name “Kemugo,” which also apparently sells Christmas decorations and children’s bicycle helmets on Amazon, it garnered some rave reviews on TikTok. Walmart subsequently removed the listing, and The Fashion Law says the listing could potentially provoke legal action by Hermès, even though the name Birkin or Hermès doesn’t appear on the listing.
What you won’t see in the breathless video reviews are the negative comments about the bag, which are still live on Walmart’s site.
It was small enough for a small preschool child. I was very disappointed!!!!
the shoulder strap was not in my handbag, the lock did not come with a key and it doesn't open without the key.
It doesn't look like genuine leather as described at all. More like a cardboard. Both material and color look so fake and cheaply made.
Exposed hard wire in bottom of purchase. dangerous
Another illustration of how consumers are often taking a risk by indulging in the purchase of fake (or fake-adjacent) dupes. Not all dupes are created equal, as Emilia Petrarca writes today.
Their low price can often only be achieved by cutting back on labour costs and materials. Think: toxic paint, dangerous manufacturing faults and products that fall apart, or, indeed, have dangerous bits of wire at the bottom.
The latest from the Hermès court case
Expect to read more about Hermès’ sales and pricing strategy this month, as the latest hearing in the Cavalleri, et al. v. Hermès International case takes place in California on 30 January. The complainants allege that the company is operating an “unlawful tying scheme” which is in effect coercing customers into purchasing other Hermès products in order for them to get access to Birkins.
The British Fashion Council gets a new boss
The British Fashion Council named Selfridges chief creative Laura Weir as its new CEO, effective from 28 April. Caroline Rush, who announced in September that she intended to step down as CEO after almost 16 years, will exit in June following a handover.