Are We in a Luxury Knickknack Bubble?

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There are currently seven Fendi Bag Bugs in Jacobik's collection, adding up to about $5,000. "I know this sounds kind of weird, but I feel like each one has a different personality," she tells Racked. "Depending on how I feel that day, I’ll usually gravitate toward a certain one."

The vlogger started a series of videos featuring the furry keychains last August. While she's done other haul videos for everything from ASOS jackets to Balenciaga bags, ones showcasing Fendi keychains consistently rack up thousands of views. "I feel like everybody who follows me on YouTube and Instagram pretty much found me through my Bag Bugs," she explains. "It’s the main reason why a lot of people follow me."

There are currently seven Fendi Bag Bugs in Jacobik's collection, adding up to about $5,000.

Luxury tchotchkes like Fendi’s are one of fashion’s weirder obsessions, but if market demand is anything to go by, there’s a ton of consumer interest in very expensive knickknacks. They're appealing because they are more than just a keychain, or a coin purse, or set of ridiculously expensive boxing gloves. They're a way to tap into a lighthearted side of luxury that doesn't often show its face.

"Our customer loves the fun, high-fashion component of the pieces," Erica Russo, Bloomingdale's Fashion Director of Accessories and Cosmetics, tells Racked in an email. "These small novelty items are often at an opening price point for the brand, so it's the perfect instant update to an accessory wardrobe without breaking the bank."

Photo: Getty

Tchotchkes from Fendi and MCM have been selling well for Bloomingdale's, and the retailer plans to keep restocking to meet the growing demand. "It really depends on the designer and the offerings, but we see it becoming a bigger trend across the board in both designer and bridge-priced brands," Russo says.

When the Fendi Bag Bugs initially hit the market as part of the brand’s fall/winter 2013 collection, there was backlash over the price. But within months, long waitlists proved that Fendi had a commercial win on its hands. A year later, Fendi started selling mini Karl Lagerfeld-shaped keychains called Karlitos for over double the price of its Bag Bugs, and most were sold before they even hit stores.

Plenty of brands beyond Fendi are vying for this market. Under Jeremy Scott's direction, Moschino has become a goldmine for cutesy, kitsch-driven products. A single silk postcard and envelope sells for $95 at Hermès. Blogger Chiara Ferragni recently Instagrammed herself in $5,900 Louis Vuitton boxing gloves. Dolce & Gabbana sent $8,000 headphones embellished with Swarovski crystals and pearls down the runway three weeks ago, and Burberry is currently selling a $3,000 set of wooden dice set in an alligator leather case with a calf suede lining and hand-painted edges. And that’s on the more reasonable side of things.

Photo: Getty

According to statistics obtained from Euromonitor International, trinkets are a fast-growing global market. Small leather goods commanded global sales of just over $3 billion in 2008 and over $5 billion in 2014. By 2018, the category is projected to grow to $6.5 billion.

Tchotchke sales are great for boosting a company’s revenue and widening its customer base. "It’s on the same scale as when you have a Yves Saint Laurent or Chanel lipstick. You’re not necessarily buying a couture gown that’s coming down the runway, but you’re getting one part of that brand," Hitha Herzog, a retail analyst at H² Research, tells Racked. "When it’s gonna start hurting brand equity is when those tchotchkes are sold at a discount store or one of those outlet stores for $100. But for now, there are only a few of them out there, there’s a high price tag, and they're associated with the ultimate in cool-people luxury."

"It’s like Chanel lipstick. You’re not necessarily buying a couture gown that’s coming down the runway, but you’re getting one part of that brand."

The association is key for consumers. "There’s some sense that [the consumer] is partaking in something extraordinary—something that goes beyond the strictly functional, the strictly everyday, the strictly necessary in life," Dr. Henrik Hagtvedt, a marketing professor at Boston College who specializes in experiential consumer behavior, tells Racked. "Not everybody can afford a $300,000 Ferrari, but some of those people can instead afford a $1,000 keyring."

The sales figures speak to the power attached to these brand names. "The brand itself is certainly something that a lot of people might want to feel connected to because of what it represents, because of how the brand makes them feel," Hagtvedt explains. "And it may also be something to do with the product itself. Not that it functions so much better—it’s a keychain—but there’s something about it that just grabs them aesthetically, or in some other way feels special."

Jacobik, for instance, knows that her Fendi Bag Bugs are exorbitantly priced for what they are, but she'll still pay. "To be honest, I don't think they are worth the price but the knockoff ones look cheap to me and don't look like they have the same quality as the authentic ones," she explains. "I would prefer to pay more money and be extremely happy with my purchase."

Photo: Getty

Expensive knickknacks are currently trending, but fashion houses have been producing kitschy items for years. "It’s not a completely new thing, these little tchotchkes," Mimi Lombardo, Haute Living's fashion director, tells Racked. "I mean, ten years ago, Prada had these little bag charms that did very well. There's a whole kind of whimsical element to it. People are interested in whimsy and sense of humor and handbags and clutches at evening events that are kind of a conversation piece."

Now, brands like Kara Ross, Anya Hindmarch, and Kotur are cashing in big time on that very idea. Anya Hindmarch currently sells a Bazooka bubble gum container reimagined as a clutch for $1,089; Kara Ross is taking pre-orders on a collection of small, cartoonish bags with "hipster" faces ($2,895) and poop emojis ($1,850); and Kotur's $400 glitter globe clutch for spring was so popular that it already sold out. The brand is planning a casino-themed collection for fall.

"People want things with more personality and with a bit of sense of humor," Lombardo says. "I’ve gone to events where you see a lot of ladies all dressed up with a handbag that’s interesting and funny. Not funny in a tacky way, but funny as a very elegant statement." Celebrities are catching on, too: Rita Ora is one of many who have shown off a slogan-emblazoned Edie Parker clutch on the red carpet and Kate Middleton has carried Anya Hindmarch on past public tours.

Based on her experience, Lombardo doesn't see luxury novelty items as a cheaper way to own a piece of the brand. Humor is simply trending these days. "I think it takes the seriousness away from luxury," she explains. "And no matter who you are and how much money you have, you have a sense of humor and this expresses that."