Why women are enthusiastic about Birkin bag by Hermes - Research Paper Example

Birkin Bag by Hermes The essay aims to proffer the rationale for women’s enthusiasm for Birkin bag by Hermes. Primarily, the discourse would address the following issues, to wit: (1) to determine the marketing strategy of Hermes; (2) to identify the marketing strategies of any other luxury brand; (3) to enumerate the reasons why many women are enthusiastic about Birkin bag (Hermes) despite inexistent commercial advertisement; and finally (4) to identify what makes the Birkin so special to women.

Birkin Bag by Hermes An Hermes Birkin bag is the “ultimate elite status symbol”, a dream of every woman in the world (Hart, 2008). It is included in Forbes magazine’s Most Extravagant Handbags list. Bag prices range from US$6,000 to US$120,000 depending on the materials used and the craftsmanship that goes with it (Prabhakar, 2007). So, why do women go gaga over a Birkin bag? What strategy does Hermes adopt making it very successful all these years despite tough competition and the worldwide financial crisis?

Where lies the “mystery” of the Hermes Birkin? According to Hermes CEO, Patrick Thomas, “Hermes has no desire to become a “masstige” (a mass producer of prestige goods) (Wright, 2009). Our strategy will be a strategy of value, not a strategy of volume; we are not in the mass luxury” (Agathe, Imadec-Bentata & Zimmerman, 2009, p. 8). They say no to short-term profit; thus, even in times of recession, few discounts are offered (Xie, n.d.) They cannot compromise the quality and the finishing of the product just to increase their sales (Wright, 2009).

Hermes strategy is centered on the respect of the legacy of the luxury brand’s history, its heritage. (Xie, n.d.) Their mission is the pursuit of excellence. They adopt a model of scarcity to preserve its prestige and integrity. They do not change their strategy according to the state of the economy (Wright, 2009). They stick to the rule of luxury, that is, even in the worst financial crisis; the world will still have rich people who would like to hold on to exclusive items that can hold value such as a Birkin bag (Xie, n.d.).

A purchase of a Birkin bag is viewed not an expense but an investment that could last for 40 years and whose price could go up to more than double as the years go by (Wright, 2009). One of the marketing techniques employed by Hermes is to keep a waiting list with high-profile customers such as Hollywood stars. They also put a “Reserved” sign on their display bag and they limit the number of Birkin sold to each customer for every purchase (Tonello, 2008 cited by AutoSurfRestarter, n.d.).

As opposed to Louis Vuitton (LV) which emphasizes marketing of their products, Hermes aims only at the excellence of their product (Agathe, et al., 2009). However, both Hermes and LV pursue a luxury pricing strategy which means high mark-ups and limited availability (Naveed, 2009). In terms of price positioning though, LV bags are priced lower than the Hermes Birkin. For LV, the fundamental pillars of their marketing strategy are innovation, differentiation and positioning (Ramaswamy, 2003).

Customers’ perception plays a vital role in the success of the Birkin bag. The perceived value of the bag is so much higher than the intrinsic value. “Hermes customers made the connection between rarity and value and rarity and social status” (Tonello, 2008 cited by AutoSurfRestarter, n.d.). Owning a Birkin screams of exclusivity (Hart, 2008). It defines your status in society. The reasons why women are so enthusiastic about the Hermes Birkin bag can be summed up into three reasons.

First is the top quality, the materials, hardware and the craftsmanship that goes with every Birkin bag. Second is the price which ranges from US$6,000 to US$150,000 depending on the leather or exotic skin used. And lastly, is the rarity or consumer distance, not being accessible to all (Tonello, 2008 cited by AutoSurfRestarter, n.d.). There is a two-year waiting list and even the rich and famous are not guaranteed a Birkin, but to them it’s well worth the wait. Only five (5) Birkins are produced every week by its Paris workroom (Hart, 2008).

The strategy is simple. High demand, low supply leads to a high price. For women, owning an Hermes Birkin bag defines their status in society. It places you in the company of the likes of Victoria Beckham, Sarah Jessica Parker, and Martha Stewart. It is more than just a product, it is an image, a lifestyle. A Birkin is like a diamond. It lasts forever (Kroll, 2007).ReferencesAgathe, G., Imadec-Bentata, S. & Zimmerman, S. (2009). Enter the luxuous world Hermes Paris: A Strategy Case. Slideshare.com. Retrieved 19 March 2011.

AutoSurferRestarter (n.d.). Personal Review: Michael Tonello’s Bringing home the Birkin: My life in hot pursuit of the world’s most coveted handbag. Slideshare.com. Retrieved 19 March 2011. < http://www.slideshare.net/AutoSurfRestarter/bringing-home-the-birkin-my-life-in-hot-pursuit-of-the-worlds-most-coveted-handbag-by-michael-tonello> Hart, G. (2008). The legendary Hermes Birkin bag. Retrieved 19 March 2011. < http://www.suite101.com/content/the-legendary-hermes-birkin-bag-a56772> Kroll, B. (2007). In the bag.

Retrieved 19 March 2011. < http://forum.purseblog.com/hermes/stars-and-hermes-6830-206.html> Naveed, K. (2009). Differentiation Strategies of Brioni, Louis Vuitton and Giorgio Armani. Slideshare.com. Retrieved 19 March 2011. < http://www.slideshare.net/naveedtaji/differentiation-strategies-of-brioni-louis-vuitton-and-giorgio-armani> Prabhakar, H. (2007). World’s most extravagant handbags. Retrieved 19 March 2011. < http://www.forbes.com/lifestyle/2007.7handbags.html> Ramaswamy, K. (2003).

Louis Vuitton Moet Hennessy: In search of synergies in the global luxury industry. Thunderbird Case Study. Retrieved 19 March 2011.< http://hbr.org/product/louis-vuitton-moet-hennessy-in-search-of-synergies/an/TB0151-PDF-ENG> Tonello, M. (2008). Bringing home the Birkin: My life in hot pursuit of the world’s most coveted handbag. William Morrow.Wright, M. (2009). Hermes will not give way to “masstige”. Retrieved 19 March 2011.< http://fashionablymarketing.me/2009/11/hermes-marketing-never-discount-hermes-birkin-kelly-handbags/> Xie, M. (n.d.). How Hermes thrives in the recession?

Retrieved 19 March 2011. < http://ezinearticles.com/?How-Hermes-Thrives-in-the-Recession?&id=3180363>