"They Said Today Was the Cheapest..." "Let's Get Wedding Jewelry!" Why Did the Luxury Brand Crowds Flocked To Cut Prices by 1.08 Million Won?

Prices of some Quatre products raised by double digits in July cut by up to 11%
Most of the increases reversed in just three months... An unusual move in the luxury industry
Gold price declines and consumer price burdens among possible factors

Amid a luxury goods industry where annual price hikes have become routine, an unusual move to cut prices has emerged. French luxury jewelry brand Boucheron has lowered domestic prices on some popular products by nearly 11%. The cuts came just three months after the brand applied double-digit increases to those products in July, effectively reversing most of the earlier hikes, analysts say. Changes in market conditions, including a drop in international gold prices, have also been cited as a factor behind the adjustment.

Han Sohee's Boucheron photoshoot. Boucheron

According to the luxury goods industry on October 12, Boucheron recently cut prices in South Korea by about 5% to 11% on some products in its Quatre collection. Quatre is one of Boucheron's signature jewelry collections, combining gold in different colors and finishes.

Quatre Classic Large (L) Pendant. Screenshot from Boucheron's website.

The Quatre Classic Large (L) Pendant, one of the collection's signature products, fell by 1.08 million won (10.82%), from 9.98 million won to 8.9 million won. The Quatre Classic Small (S) Pendant was also cut by 610,000 won (8.12%), from 7.51 million won to 6.9 million won. The Quatre White Edition Small Pendant fell by 8.21%, from 7.31 million won to 6.71 million won, while the Quatre Black Edition Small Pendant also fell by 8.21%, from 8.28 million won to 7.6 million won. The Quatre Classic Small Ring was cut by 5.67%, from 7.41 million won to 6.99 million won.

Notably, the price cuts focused on products that saw particularly steep increases in July. On July 22, Boucheron raised the domestic prices of its major products. While many items rose by around 6%, the Quatre Classic Small and Large Pendants reportedly increased by more than 12%.

If the Quatre Classic Large Pendant's July price increase was around 12%, its 10.82% cut this time means its price has nearly returned to its pre-increase level. The adjustment has reversed most of a double-digit price hike in just three months.

"When prices were raised in July, most products saw increases in the 6% range, but some Quatre necklaces went up by more than 12%," an industry official said. "This latest cut appears to be a readjustment of the prices of products that had seen particularly steep increases at the time." The official added, "Other products that initially rose by around 6% generally appear to have had no price changes."

Some in the industry have also suggested that the burden on consumers from sharp price increases may have prompted the readjustment. The double-digit hikes applied over a short period increased the cost of purchasing the products, and Boucheron may have lowered prices on some items again to ease that burden.

The Boucheron Quatre collection. Boucheron

Falling international gold prices are another factor to watch. According to the World Gold Council (WGC), at the end of September, international gold prices stood at $4,176 per troy ounce, down 8.5% from the end of the previous month. Over the same period, the yield on 10-year U.S. Treasury bonds rose by 0.53 percentage points, while the U.S. Dollar Index gained 2%. Higher interest rates reduced gold's relative appeal as an investment because it does not pay interest, while a stronger U.S. dollar added further downward pressure on prices.

Gold is a key raw material for high-end jewelry, so shifts in international prices can affect manufacturing costs. Global luxury brands adjust their prices by considering not only raw material costs but also exchange rates and price differences between markets. However, jewelry prices also reflect design, craftsmanship, and brand value, and there may be a lag between raw material purchases and price adjustments. It is therefore difficult to conclude that the recent drop in gold prices directly led to these cuts.

Another reason the adjustment has drawn attention is that it runs counter to the luxury goods industry's long-standing pricing strategy. Luxury brands have not only passed higher costs on to consumers but have also continuously raised prices to reinforce the perception of exclusivity and luxury. Maintaining consumers' expectation that prices will keep rising is itself part of the sales strategy. The commonly held belief that "today is the cheapest day to buy" is a case in point. Frequent price hikes encourage consumers to buy before further increases take effect. They can also give existing customers the satisfaction of feeling that the value of their purchases has increased.

Conversely, lowering official prices could lead some consumers to delay purchases in anticipation of further cuts. Existing customers may also feel dissatisfied that the products now cost less than what they paid. This is why luxury brands generally prefer to delay price hikes or reduce their size rather than cut official prices, even when sales fall short of expectations.

In this respect, Boucheron's latest adjustment shows that even in a luxury goods industry where continuous price hikes have become the norm, prices on some products can be lowered again. However, as the cuts are limited to a small number of products, it is too early to say that the brand's overall pricing policy has changed.

"The fact that luxury brands, which have boosted their value through continuous price increases, have lowered their selling prices again is notable in itself," another industry official said. "It remains to be seen whether this adjustment will be a one-off or influence the pricing policies of other brands."

This content was produced with the assistance of AI translation services.