A Louis Vuitton bag is likely to cost 10 times a high end bag at your regular retailer.
Does it have 10 times better quality? May be it looks 10 times better?
The answers to the above questions aren’t really important to the buyer as buying luxury products provides a sense of ‘elite status’.
People don’t buy products based on their actual value. They buy because the product price matches the perceived value they have for the product.
Companies spend huge amount of money to influence that perception. The concept of perceived value is the reason Apple sells its products at a price premium and buyers are happy to pay more for exotic products.