Hermès - Mastering Scarcity

In Economics 101, we were taught about scarcity. Quick refresher: artificially control the supply side and boost demand curve. Voila! You have exorbitant prices. 

And, no one does this better than luxury brand Hermès. Thanks to the brand’s fanatical fan base and the absurd lengths they’ll go for a shot at a Birkin handbag, one of the world’s most exclusive and elusive products.

The brand doesn’t sell its handcrafted bags online, and you can’t simply walk into a boutique and walk out with one. Instead, Hermes has made it into a game — and they won’t tell anyone the rules.

To buy a Hermes bag is to live a riddle: lay years of groundwork, spend tens of thousands of dollars, and hope for a call that you are now eligible to buy one, a call that still may never come.

Today, the brand is worth $216B, its annual returns are booming even as other luxury brands falter, and the success has made its founding family the richest in Europe, with a combined fortune of $151B. 

Like any subculture, the online Hermès fan community has developed its own language. Countless videos detail tips on how to score a dream Birkin:

🤔 1. Know your stuff: 

Hermès has names for types of leather, hardware, and color, and will keep its clients’ wishes on record to compare against stock they receive

🤝 2. Build a relationship: 

Keep in touch with an Sales Associate or SA, via text or dropping into a boutique

💅 3. Look good: 

Dress with confidence, and demonstrate a willingness to wait your turn

🛍 4. Visit the mothership: 

The Paris boutiques are the only ones in the world that offer “leather goods” appointments, where customers with or without a spend history can take their chances advocating for an opportunity to buy a quota bag 

At 1 in 167, your chances of getting am appointment at Hermes Paris is lesser than getting into Harvard University (4%). The game creates a lot of anger among people who don’t feel the brand plays fair. But many of its customers are people spending hundreds of thousands of dollars a year at the store, who can buy the entire place out on a whim. 

“What better way to encourage those people to come back? By dangling something that money can’t buy"

Fun Fact: Victoria Beckham has a Birkin collection estimated to be worth $2m.

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