Chanel’s Surprise Price Hike to Start the New Year
Classic Maxi Bag Crosses the 20 Million Won Mark
French luxury brand Chanel has once again raised its domestic retail prices. The prices of its signature bag lines have increased by around 7%, with some products now exceeding 20 million won. As major luxury brands have simultaneously raised prices at the start of the new year, the so-called "early-year price hike formula" in the luxury industry has been reaffirmed. Analysts say that the solid demand in the Korean market is the driving force behind these bold price increases, even amid high interest rates and a sluggish economy that have dampened consumer sentiment.
Chanel’s Surprise Price Hike... The Era of the ‘20 Million Won’ Classic Bag
According to industry sources on January 19, Chanel Korea raised the prices of certain products, including bags sold domestically, starting from January 13. With this latest increase, the Classic Maxi Handbag has gone up 7.5% from 18.92 million won to 20.33 million won. The Classic 11.12 Bag rose 7.4% from 16.66 million won to 17.9 million won. The Boy Chanel Small Flap Bag also increased by 7.5%, from 9.86 million won to 10.6 million won.
Chanel’s price hikes have effectively become an annual event. Last year, Chanel raised the prices of major items such as bags, wallets, and shoes four times-in January, June, September, and November. Among consumers, the saying “Today is the cheapest day” has become common.
The Higher the Price, the Greater the Brand Power
Despite repeated price increases, Chanel’s brand power has only grown stronger. In the 2025 global luxury brand valuation, Chanel’s brand value rose by 45% year-on-year to 37.9 billion dollars, ranking second overall and first in the fashion sector. Louis Vuitton, which had long held the top spot, dropped to third place with a brand value of 32.9 billion dollars.
Industry experts say that Chanel’s “ultra-premium strategy” has succeeded in elevating brand value by surpassing the price resistance threshold. Rather than dampening demand, the price increases have enhanced the brand’s exclusivity and symbolic value.
Early-Year Price Hike Rush Among Luxury Brands
Chanel’s latest price hike was widely anticipated. The top-tier luxury brands, often referred to as “Her-Lou-Cha” (Hermes, Louis Vuitton, Chanel), have all raised prices at the start of the year. Previously, Hermes increased prices by about 5-10% across bags, clothing, and shoes on January 5. The popular “Lindy 26” bag jumped to the 11 million won range, and shoes such as loafers also saw uniform price increases. Prada and Tiffany & Co. have also joined the price hike trend, citing raw material costs and global pricing policies.
Defiant Pricing Despite Economic Downturn
Despite high interest rates and an economic downturn that have dampened domestic consumption, luxury brands continue to raise prices, largely due to the robust demand in the Korean market. The so-called “Veblen effect”-where demand is maintained or even strengthened as prices rise-is clearly at play. In fact, according to the Financial Supervisory Service’s electronic disclosure system, Chanel Korea’s 2023 sales reached 1.7038 trillion won, a 7.1% increase over the previous year. Industry insiders predict that, depending on global economic trends, further price hikes within the year cannot be ruled out.
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