In fact, that has been the way things have gone since Ogg the caveman needed a harder stick to kill his dinner. But it has not had such a snowball effect until post war WWII in America.
After the war things were booming (including babies). A new trend in American housing was taking place known as "Suburbs". New homes, new babies, sleeker cars, we were on a roll and the sky was the limit. In an effort to finance the newer and bigger way of life, the suburban housewife entered the job market. At this point retailers realized that the new influx of money into the household had to go somewhere... into the retailers pockets.
Technology was also advancing and new gadgets were churned out. Take for example the first digital quartz watch on the market made by Pulsar. It cost as much as a Chevy Vega at that time and after the 2'nd year of manufacture, a woman's version was on the market. Advertised as a "Time computer" it was sold in fine jewelry stores. One can only imagine how special the owner of one of these baby's felt. Sadly though the darn thing was buggy, awkward to use and was not marketed long.
As time went on, things evolved. With the advent of cheap overseas labor, anyone could manufacture anything quickly and cheaply. At one time almost every middle class family could have a little piece of the American dream. But retailers by nature want you to buy all of your dreams from them (not the competition, but them). And why would you want to buy from them? because theirs is better...it is DESIGNER.
Yes, their product is exclusive and to show your friends and neighbors that you are not really as common as they are; You, being an exclusive kind of person and a very special "individual" truly deserve the best, and must have that coveted item to prove it. And if any of your not so trendy friends even question your purchase, just let them know that style and taste cost a lot of money.
Besides, if you go out and spend all that money you better look and be cool just like the salesperson told you that you would. After all, they wouldn't lie to someone with a fist full of money would they ?