Hundreds of years ago, Hermes and Louis Vuitton started out as luxury makers of tools. If you needed a saddle or a suitcase, they offered an extraordinary option, both elite and useful.
Over time, they shifted gears, no longer competing on whether or not their luggage was the most useful, or their saddles the most efficient. They competed on luxury, which is a fundamentally different promise than the optimal design of a tool.
Patagonia is still a luxury tools company. The coats they sell cost more, but some professionals choose them regardless of brand, because in addition to tribal affiliation and the placebo that comes from buying a luxury good, they're still extraordinarily functional.