The ‘Birken Indicator’ — 4 Things the Rich Love To Buy That Are No Longer in Their Budget in 2025
Written by
Stacy Sare Cohen
Edited by
Zuri Anderson
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The Birkin indicator is a benchmark for the demand and resale value of the Hermès Birkin handbag, a status symbol coveted by the rich and A-listers for its timeless appeal and handmade craftsmanship.
This status metric gauges the strength of the luxury market and the spending power of the wealthy. Even during economic downturns such as the pandemic, Birkin bags have reported record sales, according to CNN.
However, as the prices of luxury handbags rise, the industry is predicted to decline by 2027 in favor of high-end jewelry, watches, art collections and enriching hospitality experiences, according to a study by the Independents, cited by CPP Luxury.
Since the rich are investment-minded, they shift their focus when products lose value and climb in price. With the rising cost of private school tuition, fluctuating stock market performance and the expenses tied to their million-dollar homes, even the wealthy have to evaluate whether the indulgences they love are worth the price.
Here are four things the rich love to buy that no longer make sense for their wallets in 2025.
LVMH
The fashion conglomerate LVMH, owned by Bernard Arnault and managing 75 brands, including Dior, Louis Vuitton, Tiffany & Co., and Bulgari, has been experiencing slower sales since the post-COVID period, according to DW. As of July 2024, profits fell 15% to $10.5 billion.
Kering
LVMH is not the only designer brand seeing a decline. Kering, also headquartered in Paris, owns fashion brands Gucci, Yves Saint Laurent and Bottega Veneta, which have also reported significant sales declines. In a 2024 New York Times essay, Wall Street Journal fashion director Katharine K. Zarella noted that after a decade of consistent growth, “the sector is bombing across the globe,” DW reported.
European and Swiss Luxury Goods
A significant factor impacting the European and Swiss luxury market is the Donald Trump administration’s tariffs. President Trump has imposed a 15% tariff on European goods imported into the U.S. and a 39% tariff on Swiss products exported to America.
This has evidently influenced consumer buying behavior in the U.S., as many luxury handbags and designer clothing come from Italy and France, and the most prestigious watches, such as those from Audemars Piguet, are designed and manufactured in Switzerland.
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