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Because many people prefer quantity over quality. They also want the latest styles rather than stick with the classics. Therefore, they'll spend, say, $30 on something cheap rather than save up an make a $300 purchase for something that'll last them years.

Not to mention that there are many people who can afford $30, and can't afford $300, quality be damned. But, yes, the $300 piece is usually the better investment.

The branded clothing was always cheaply-made, disposable crap. It's just that companies like Zara and H&M are now making more fashionable-looking cheaply-made, disposable crap, and given the choice, people prefer it to having a cheezy "Hollister" written across their chest.