1. Reputation of manufacturer: when you spend a lot on a handbag, the company will often repair it for low or no cost with equivalent materials, making the bag good as new. An emerging designer, using the same high-quality materials, might be willing to do this, or he might be a fly-by-nighter. One must also weigh the probability that the bag require repairs in the first place. I would rather have a very well-made bag at $2X that only requires one repair every five years than a fairly well-made bag for $X that requires repair every two years. This leads to . . .
2. Quality of materials: I know Sarah said she doesn't buy this, but I have never seen such leather in my life. It is supple, tough, soft. I have no particular attachment to the Fendi brand or marketing; in fact, I don't like their clothes, sunglasses, or even their (tacky) cloth logo bags. But when I saw one of their Selleria bags on a pedestal in a Vegas shop, it literally stopped me in my tracks and I had to have it. I didn't buy it then, either; I waited for a month and then, when I realized I still wanted it, purchased it in Houston. It is the finest thing I have ever owned. I used to have a designer cloth bag that I paid over $100 for (on a student budget this was big; I was hit by a similar thunderbolt in Italy while traveling and had to have it). It quickly became stained, scuffed, and ugly. With a year of use, this bag has no signs of wear.
3. Cost effectiveness relative to other luxury goods I might buy: Bear with me here. I bought this bag about a year ago. I carry it every day and plan to do so until it falls apart (a long time from now; see #1). Cost per use thus far is about $5 and will only go down. A fancy diamond necklace might cost more than my bag, but could not be worn every day; its cost per use might be in the hundreds, even if one had a few formal occasions per year. Likewise designer shoes, which probably don't match everything and are more likely to be taken out of commission by a subway grate before they wear out. Designer clothes similarly have a high cost per use, and the more distinctive they are, the less frequently they can be worn (I take it that this form of caring what other people think is not terrible objectionable). It is really most like a Rolex, but I don't care for Rolexes.4. Aesthetics: At the risk of sounding all Miranda Priestley, fashion is (or at least can be) art. I am not terrible stylish, but I do like beautiful things and sometimes I am willing to pay for them. Sarah points out that the raw materials and labor are only a small part of the price. Certainly the raw materials and labor to create an oil painting are also small, but the most lovely ones still fetch large sums. Loveliness is rare and must be pursued with abandon.