Fashion
Bag charms selling for $1,000 are retail’s next little luxury
By
Bloomberg
Published
August 14, 2025
Years after Jane Birkin famously decorated her eponymous Hermès handbag with clusters of trinkets and strands of beads, bag charms have made a big comeback.
Plush Labubu keychains helped revive the Gen Z-fuelled accessorise-your-accessory trend and catapulted it into the mainstream. Now charms are showing up on elite fashion runways and dangling from the purses of celebrities.
Designer handbag makers, anxious for growth during a downturn, are especially eager to get in on the phenomenon. If affluent shoppers can’t be persuaded to drop thousands of dollars on a new purse, perhaps they can be enticed to spend a few hundred dollars on a branded charm for a purse they already own.
Ethan Diaz, 24, used to splurge regularly on high-priced purses and streetwear that he would barely use. Now, bag charms enable him to quickly switch up the look of his purses without blowing his budget. He recently dressed up his $695 Coach Soft Empire Carryall Bag with a handful of eclectic charms, including a $120 Longchamp keyring in the shape of a croissant.
The commercial director from New Jersey began buying the embellishments a year ago and now owns 30, the most expensive being a $1,010 Louis Vuitton crab charm that doubles as a small pouch. “You can mix and match and put it on different bags, so you’re not limited to one specific style,” Diaz said.
Sales at luxury brands have been falling for several quarters, and companies are putting out more affordable and smaller accessories to reverse the slump and drive up store traffic.
Last month LVMH Moët Hennessy Louis Vuitton SE reported that second-quarter sales fell 9% in its key fashion and leather goods unit as shoppers reined in purchases of costly purses and clothing. Rival Kering reported that Gucci sales plunged 25% during the same period compared with a year earlier, while sales at Prada declined 3.6%.
Shares in the companies are all down double digits in the last 12 months, and consultancy Bain & Co. expects the personal luxury goods industry to shrink between 2% and 5% this year. That would be the worst performance since the 2009 global financial crisis if the pandemic is excluded.
Tapping into the viral bag charm craze is “sensibly opportunistic” for luxury companies that might as well “make some money off the back of it,” said Neil Saunders, managing director at analytics firm GlobalData.
Tapestry Inc., which has been outperforming top-tier labels thanks to strong sales at its attainable luxury brand Coach, has expanded its assortment of charms there and at Kate Spade. The company plans to significantly increase the number of pieces offered at Kate Spade, where sales have been falling, during the holiday season.
Unique bag charms provide “an accessible way in” to the two brands, said Alice Yu, Tapestry’s vice president of strategy and consumer insights.
Ultra-luxury brands have sold charms for years, but mainly as afterthoughts to big-ticket items. Many sold them online only. Now the charms are front and centre in boutiques and at fashion shows.
“If we don’t get into this and lean into this, someone else will,” Saunders said of the prestige brands. And as some of their wealthy customers hold off on buying new purses and clothes, hooking them with a stylish bag charm helps maintain valuable client connections during a rough patch. “The worst thing for a brand is to lose a consumer completely,” he said.
During recent visits to Bloomingdale’s stores, statement charms were featured throughout the handbags departments. At the retailer’s Manhattan flagship, Prada was showcasing its $825 black and gold robot charm attached to a $2,300 backpack. In Los Angeles, Gucci’s $510 dragonfly-shaped keychain was clipped to one of the handles of a $1,950 handbag, and three dog-shaped charms, $450 each, were lined up in a display case alongside monogram card holders and wallets.
Although bag charms are booming, industry analysts caution that they can only bolster luxury brands to a point.
Ultimately, charms “will make up a very small portion” in sales for premium fashion labels, said Bloomberg Intelligence analyst Deborah Aitken. “Enough to keep brands active in the minds of potential shoppers, but at very limited total value.”
Louis Vuitton and Loewe declined to comment on their bag charm strategies or provide sales figures. Gucci and Fendi did not respond to requests for comment.
Klevisa Hendrix, a 27-year-old content creator from Los Angeles, began buying bag charms this year after seeing them on the Coach runway and now has a dozen in her growing collection. She typically spends less than $100 on a single charm. “You want to be fashionable,” she said, “but you want to still be able to afford fashion.”
Wholesale revenue dropped 12.8 per cent on a currency-adjusted basis to €4.9 billion, while direct-to-consumer (DTC) sales increased 3.4 per cent, lifting the DTC share to 32.4 per cent from 28.9 per cent.
Regionally, sales fell 6.9 per cent in Europe, Middle East and Africa (EMEA), 7.4 per cent in Asia-Pacific and 10 per cent in the Americas, with North America driving much of the decline.
Puma has reported sales of €7.3 billion (~$8.61 billion) in FY25, with currency-adjusted revenue down 8.1 per cent amid strategic reset actions.
Wholesale declined while DTC share increased.
Margins contracted and EBIT turned negative, leading to a net loss.
Q4 saw sharper declines across regions and categories.
Puma expects further sales softness and negative EBIT in FY26.
By product segment, footwear sales decreased 7.1 per cent, apparel declined 9.7 per cent and accessories fell 8.5 per cent, although selective growth was observed in running, training and premium sport style lines, Puma said in a press release.
Profitability weakened significantly during the year. Gross margin contracted 260 basis points to 45.0 per cent, impacted by promotional activity, inventory reserves, unfavourable mix and currency effects. Adjusted EBIT turned negative at €165.6 million, while reported EBIT declined to -€357.2 million after €191.6 million in one-off costs related mainly to the cost efficiency programme and goodwill impairments.
Loss from continuing operations widened to -€643.6 million, translating to earnings per share of -€4.37 versus €1.88 in the prior year.
From a balance sheet perspective, inventories rose 2.3 per cent to €2.06 billion as inventory takebacks from wholesale partners supported distribution clean-up. Working capital increased 20.2 per cent, while trade receivables and payables declined sharply in line with reduced sales and purchasing activity. Puma ended the year with additional financing capacity, including €1,202.2 million in unutilised credit lines.
Fourth quarter (Q4) performance reflected the peak impact of the strategic reset. Currency-adjusted sales declined 20.7 per cent to €1,564.9 million, with reported revenue down 27.2 per cent due to currency headwinds. The decline was driven by deliberate reductions in wholesale exposure, inventory clearance actions and lower promotional intensity.
Wholesale sales fell 27.7 per cent in Q4, while DTC revenue decreased 8.0 per cent, although DTC share increased to 41.1 per cent from 35.5 per cent. Regionally, sales dropped 12.6 per cent in Asia-Pacific, 22.2 per cent in the Americas and 24.3 per cent in EMEA.
Across product divisions, footwear sales declined 25.4 per cent, apparel fell 13.7 per cent and accessories dropped 18.2 per cent, with selective resilience in training and performance running categories.
Profitability deteriorated sharply. Gross margin declined to 40.2 per cent from 47.7 per cent due to promotions, inventory provisions and currency effects. Adjusted EBIT fell to -€228.8 million, while reported EBIT reached -€307.7 million following one-off costs linked to restructuring and impairment charges. The quarter ended with a loss from continuing operations of -€335 million.
Arthur Hoeld, CEO of Puma, said: “2025 was a reset year for us. We want to establish Puma as a top 3 sports brand globally, return to above-industry growth and generate healthy profits in the medium term. It is crucial to make the Puma brand less commercial and ensure we once again excite our consumers with attractive products, compelling storytelling and distribution in the right channels. I am satisfied with the progress we have made so far. We cleaned up most of our distribution by reducing promotions in our own channels and cutting our exposure to those wholesale channels that damage our brand’s desirability. To better position our product icons and our performance offering and tell more engaging product stories, we created the right structures inside our company. We also addressed operational inefficiencies and further optimised our cost base.”
Looking ahead, Puma expects currency-adjusted sales in fiscal 2026 to decline in the low- to mid-single-digit percentage range, with EBIT projected between -€50 million and -€150 million. Capital expenditure of around €200 million is planned as the company continues investments in brand repositioning and digital capabilities, added the release.
Fibre2Fashion News Desk (SG)
Nominal GDP, or GDP at current prices, is estimated to grow at 8.6 per cent to reach ₹345.47 trillion in FY26 against ₹318.07 trillion in 2024-25.
India’s real GDP is estimated to grow at 7.6 per cent to ₹322.58 trillion (~$3.54 billion) in FY26 compared to the first revised GDP estimate of ₹299.89 trillion for FY25 (7.1 per cent growth).
It released the new series of annual and quarterly national accounts estimates with FY23 base.
Real GVA is projected to grow at 7.7 per cent to reach ₹294.40 trillion in FY26 against ₹273.36 trillion in FY25.
Real gross value added (GVA) is projected to grow at 7.7 per cent to reach ₹294.40 trillion in FY26 against ₹273.36 trillion in FY25 (a 7.3-per cent growth rate).
Nominal GVA is estimated to grow at 8.7 per cent to hit ₹313.61 trillion during FY26, against ₹288.54 lakh crore in 2024-25.
Robust economic performance in FY26 is primarily on account of robust real growth observed in the second quarter (8.4 per cent) and third quarter (7.8 per cent).
The manufacturing sector has been the major driver of resilient performance of the economy the consecutive three fiscals after rebasing, a release from the ministry said.
Both private final consumption expenditure and grossed fixed capital formation exhibited more than 7-per cent growth rate in FY26.
Fibre2Fashion News Desk (DS)
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