kat- i'm not saying that people will buy something they don't like just because it's an "it" bag. i had a similar experience to yours where i was with my mother at madison and she bought a
fendi spy bag and i opted not to get one because i'm not in love with the bag. however, i am saying that if there is an it bag that you like out there, people tend to justify to themselves spending the money (even people who do not necessarily have the money to spend) because it's and it bag, and they want to be able to show it off.
i am basing my conclusion on the way people in la/beverly hills act, and i cannot for sure say it's the same case everywhere. but in a city where people are judged mainly on looks, style, and money, people are willing to shell out a ton of cash just to prove they have it. i on the other hand buy my expensive handbags (err...well, my mother buys them, but i choose them) based on what i like, but i will admit that i like to show them off as well.