The Year Hermès Ruled the World

The brand finishes 2024 with a PR masterclass on '60 Minutes.'

This week, Back Row is running a special, daily series looking back at 2024 and the first half of the 2020s, as the decade’s defining trends, people, and brands firm up. Today, a look at why Hermès is kicking ass in the luxury downturn. Earlier in the series:

The Year of Mess

The Year 'Vogue' Lost the Plot

The Year Brown and Beige Ate the World

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Hermès has been giving the fashion industry a masterclass in sales growth during a rough year. Hermès sales are up 14 percent year-over-year for the first nine months of 2024, while sales at LVMH’s fashion and leather goods sales were down 5 percent in the third quarter and Kering’s were down 16 percent on comparable bases. Consumers are so ravenous for Birkin bags that aspiring Birkin owners are actually suing Hermès in California for not selling them one of the purses, which costs $11,400 on the low end.

Earlier in Back Row:

Retail Confessions: Hermès, Part II

That lawsuit — likely un-winnable — was just more brilliant PR for Hermès. What other brand has mastered the strategy of scarcity and mystery so thoroughly that someone would want the bags badly enough to file a lawsuit? The brand’s handbag selling strategy is the ultimate form of letting shoppers know who’s “in” and who’s “out.” Hermès knows people will spend a lot of money to be “in.”

This week, the brand gave the industry a master class in public relations with a segment on 60 Minutes. Correspondent Sharyn Alfonsi interviewed Hermès artistic director Pierre-Alexis Dumas about the brand’s heritage (it started as a saddle company in 1837), its prices (“costly” but not “expensive”), and its manufacturing process (quiet factories in the French countryside where content employees hand-make each bag). Dumas is descended from Robert Dumas, Émile Hermès’ son-in-law who created the first iteration of the brand’s famous silk scarves.

Let’s fact-check some of his talking points.

“We don’t have a marketing department,” Dumas said.

This needs context.

Alfonsi asked Dumas about the idea that Hermès creates artificial scarcity by making people wait to purchase a Birkin bag versus just selling it to them right away. He replied, “It makes me smile that this is a diabolical marketing idea that can only come out of people obsessed with marketing, but we don't have a marketing department.” Sure, Hermès may not employ people with “marketing” in their job titles, but a quick glance at LinkedIn shows a number of employees who perform functions like PR and “Influence Specialist.” A job description for “VIP and Influence Coordinator” posted to Hermès’s site reads:

Administrate the development and execution of a strong, dynamic, and strategic VIP & influence product placements on social, coordinating with press team for appropriate VIP & Influence press coverage in top tier national and regional publications to increase brand visibility across all fashion métiers.

An old job listing for “Media Manager” included “placement, execution, trafficking, & analysis of all Paid Media campaigns.” Sure sounds like the M-word.

Alfonsi asked Dumas about the scarcity of Hermès’s most popular bags. “Whatever we have, we put on the shelf and it goes,” Dumas says. “There’s not a room where you guys are holding all the bags back and saying, let’s see what happens?” she presses. “Maybe we should,” he says, grinning. Alfonsi says, “The simple truth, Dumas says, is that Hermès doesn't have enough artisans to build the bags, which for a century, he says, have been made from start to finish by a single craftsman.”

Not exactly.

Maybe it’s true that Hermès doesn’t have enough artisans. But when I interviewed former Hermès sales associates for “Retail Confessions,” they explained that stores did have Birkins in a back room.