Luxury brands offer cheaper goods for middle-class shoppers

Confronting a decline in demand for their usual fare, including $3,000-and-up handbags and $4,000-and-up cashmere jackets, major marketers of designer and luxury merchandise are broadening their product lines to emphasise scarves, belts, wallets, and home goods priced at $500 and under.

The brands' renewed focus on more affordable products is meant to appeal to middle-class aspirational customers who are more price sensitive, although the strategy may dent their typically fat profit margins.

After more than two years of sharp price hikes — with Chanel, Prada, and LVMH's Dior raising handbag prices by over 50 per cent in France in 2023 compared to 2020, according to the Wall Street analysts at Bernstein — luxury labels are finding themselves at risk of alienating the middle class.