'Displeased': Hermès CEO voices discontent over the appearance of used Birkin bags in the secondary market
The resale of Hermès Birkin bags has become a contentious issue for the luxury brand, with CEO Axel Dumas expressing his displeasure at the surge of new Birkins appearing on secondhand markets. According to Dumas, this practice harms the brand's relationship with its genuine customers, as it can prevent them from acquiring Birkins directly from Hermès stores.
During a press conference on quarterly results, Dumas spoke about how the active reselling of classic bags like the Birkin has the potential to dilute exclusivity and frustrate loyal customers who cannot purchase bags at retail. He views the practice of buying bags specifically to resell them as opportunistic and disruptive.
From the brand's perspective, reselling can pose risks. The uncertainty and financial risk for buyers reselling secondhand items is a concern, as they may not recoup their original price due to fluctuating resale values and the prevalence of counterfeit products. Additionally, active reselling can potentially damage the brand's carefully curated luxury image and customer loyalty.
However, there are also benefits to the resale market. The strong resale market underscores the Birkin's status as a cultural icon and investment asset, reinforcing its allure and indirectly supporting Hermès’ brand prestige and sales across categories. For consumers who cannot purchase new from Hermès, the secondary market provides a way to access coveted classic bags.
In the US, the selling price of a Birkin Bag exceeds $10,000 (about €8,700). Despite the challenges posed by resale, Hermès reported a quarterly turnover of eight billion euros, representing an eight percent increase in sales compared to the same period last year. The brand remains one of the few luxury brands not affected by the slowdown in the luxury segment.
The popularity of the Birkin Bag, first introduced in 1984 and named after British actress and singer Jane Birkin, has led to a flood of imitations and counterfeits. Despite these challenges, the Birkin Bag remains one of Hermès' most iconic products and a symbol of luxury and exclusivity.
While resale markets create financial upside and cultural cachet that can benefit brands like Hermès, they also pose risks to brand integrity and customer relationships. Hermès’ leadership currently views this tension as a significant challenge to managing its iconic products and luxury ethos.
[1] The Business of Fashion [2] Forbes [3] CNN Business [4] The New York Times [5] Vogue Business
- What about the potential risks to brand integrity and relationships with customers posed by active reselling in the secondary market for luxury items, such as Hermès Birkin bags, does Hermès' CEO Axel Dumas find frustrating, as expressed during a press conference on quarterly results?
- Besides being a cultural icon and investment asset, the strong resale market for Hermès Birkin bags could indirectly support the brand's prestige and sales across categories like fashion-and-beauty and lifestyle, as highlighted by various outlets such as The Business of Fashion, Forbes, CNN Business, The New York Times, and Vogue Business.
