The situation: Louis Vuitton’s forthcoming beauty launch will test its pricing power. The brand is betting that premium packaging and high-quality products designed by makeup maven Pat McGrath will convince shoppers to spend $160 on a single lipstick—a risky assumption given the headwinds plaguing the luxury industry.

A bold move: While other luxury labels use their makeup brands to keep aspirational shoppers in the fold, Louis Vuitton clearly has greater ambitions. Its pricing is aggressive even by luxury standards: Hermès’ $80 lipstick is a steal by comparison, while Clé de Peau Beauté—another brand known to induce sticker shock—charges $113 for its Precious Lipstick.

For Louis Vuitton—like so many other luxury brands—higher prices are a way to confer greater exclusivity, and capitalize on shoppers’ fervent desire to own anything with an LV monogram. But that strategy has its limits, as Gucci, Burberry, Michael Kors, and a host of other brands have discovered to their detriment. Making something more expensive does not automatically make it more attractive to the 0.1%, especially since those consumers tend to be highly discerning and have elevated standards for what they buy.