Data Analysis on Luxury – Is it a good idea to get a Chanel bag now?

Luxury bag prices have kept increasing yearly or even quarterly. Take Chanel as an example. A Medium Classic Flap Bag was only US$ 2,850 in 2010, but in 2024 it already rose to US$ 11,850!! It increased 4 times in just 14 years. Is it a good investment to buy a luxury bag now?

Author: Yan Tam, DANGER Bootcamp Alumni

A luxury bag may be a dream for many people. However, luxury bag prices have kept increasing yearly or even quarterly. Take Chanel as an example. A Medium Classic Flap Bag was only US$ 2,850 in 2010, but in 2024 it already rose to US$ 11,850!! It increased 4 times in just 14 years.

Is it a good investment to buy a luxury bag now? Below is the price history for the Chanel Medium Classic Flap Bag between 2010 and 2024.

The increasing rate was sped up rapidly after 2020. We want to know the hidden reason and predict the future selling price.

First, we will start with the most significant reason driving the pricing trend. LVMH (the mother company of Chanel) claims the price up is to protect its margins in an inflationary environment. It increases the production and operation costs.

What is the most significant reason for the price up?

Comparing the inflation rate and Chanel bag selling price, there is no close relationship.

After collecting data from different sources, like the LVMH website, international organizations, and data platforms (e.g. Statista), it has been conducted there are some related factors.

The most significant factor is LVMH’s last year’s sales performance instead of the inflation rate.

Is it a good choice to buy a Luxury Bag now?

Let’s return to our main topic, is it a good time to buy a luxury bag now? I made the price prediction by Prophet Time Series in 2023, below are the price predictions.

The blue line represents the exact price prediction, the shadow area is the predicted price range and the black point is the actual price.

There were sudden price increases in 2023 that did not follow the past price history pattern, seems LVMH had changed its price strategy in 2023.

Below is the price prediction between 2023 and2031

In 2024, the Medium Classic Flap Bag reached US$11,850, already over the predicted price upper limit. The next step is to find out any other hidden factors to drive the price trend.

But no matter the reason, the only thing that we can confirm now is the price increase rate is much higher than the inflation rate. So grab your wallet and hit “buy” before someone else does.

Read Further: Medium | Code: Github