When Gucci-owner Kering and Hermès report earnings this week, investors will be looking for signs that the big luxury fashion groups are confident that wealthy shoppers are willing to pay higher price tags for designer accessories. Rival Louis Vuitton, the world’s largest luxury label, said on Tuesday, February 15, it would raise prices globally from February 16 due to higher manufacturing and transport costs – one of the first major luxury brands to do so this year. Pricing power could emerge as a key driver of revenue growth again in 2022 for the top tier of the fashion and leather goods industry, following a string of price hikes in 2021 and 2020. Consumers came out of lockdowns eager to spend their cash on luxury fashion and accessories, after months of being stuck at home. Brands are taking advantage of that spending power to make their wares even more costly and exclusive. 6 facts about A$AP Rocky, father to Rihanna’s first child Bloggers on China’s social media platform Xiaohongshu are forecasting higher prices from Kering profit engine Gucci from as soon as Friday, February 18. Gucci’s small Marmont shoulder bag, which currently costs 16,500 yuan (US$2,600), is seen going up around 3 per cent, while other Gucci accessories could climb 10-15 per cent. Users of the Xiaohongshu site, known in the industry as Little Red Book, often cite sales associates for the fashion labels and have a track record of correctly predicting price increases but do not always specify their sources. Kering’s Balenciaga already raised prices in early January in China, according to the Xiaohongshu site. The cost of the label’s curvy Hourglass handbags in size small and extra-small, for instance, has risen by 3.5-4 per cent to 17,500 yuan and 11,550 yuan respectively. Kering declined to comment, noting it is in a closed period ahead of its annual earnings on Thursday, February 17. Hermès said it would be likely to address the pricing issue when it reports earnings on Friday, denying analysts’ reports that the company had already increased prices last month by 3 to 10 per cent. Chanel raised the prices of some of its most sought after handbags three times last year, with its small classic handbag now costing around US$8,200, or 60 per cent more than in 2019. How Olympic teen ski champion Eileen Gu became luxury’s most bankable face “This year is likely to bring a virtuous circle of pricing power and brand desirability,” UBS said in a note to clients. Kering is expected to report organic sales growth of 20 per cent over the fourth quarter, HSBC has forecast, helped by marketing investments generating buzz around Gucci’s 100th anniversary last year. Sales at Hermès are expected to rise 12 per cent at constant foreign exchange rates over the period, HSBC said. Want more stories like this? Follow STYLE on Facebook , Instagram , YouTube and Twitter .