The art of pricing?

I often ask myself how designers and brands price their items. Would the piece be more affordable if the design process was quick? or just beacuse it's a luxury brand its OK for the consumers to sometimes pay crazy amounts of $$$? Check out the creative and fun clotch abve- it is priced at $6,995. Yes you are reading this right, I did not make a typo!

and maybe it's an inside joke, like Christian Louboutin is saying "you must be on medication to pay that! " 

All I know is, that's more than I paid for my 1st car :)