Chanel’s Rise & STALL: Defects, Difficulties & Deflection (formerly the 19 tote saga thread)

[TPFer2015]

Guess is all we can do regards Chanel, they even prefer to pay fines every year rather than file financial or other data.

I don't know whether you mean units sold, space allotted to, net or gross profit with your guesstimates . It's another topic, but Chanel is far more reliant on its beauty as profitable affordable luxury rather than accessories, bags included. They make a very large profit on couture, never mind RTW, one of the only Maisons to do so. Couture is a whole other story.

The Wertheimers who own Chanel came to Paris from Alsace 1870 at the time of Franco-Prussian war (Alsace used to be a part of Germany, Prussia won and Germany was formed in 1871). They owned Bourjois, who then helped develop Chanel's fragrances and later makeup. When Chanel died in 1971, they bought her (then quite tired looking - I have a bag from then) business and have been owning/running it ever since. Recently Coty (US) bought Bourjois from Chanel in 2014 (I think the date's correct) as well as financial, Chanel now own 4.2% stake in Coty as part of the deal whilst allowing Chanel to concentrate on luxury. Chanel Beauty, fragrances and skincare probably (guessing too) accounts for more than 50% of all profits as it's not only sold in more places, to many, many more people, higher in stock turnover, but the mark-ups are way more than on any bag.

Am not surprised if make-up/beauty accounts for more than 50% of profits. Having some insight into fragrance & beauty businesses, the margins on this business line is insane. It used to cost 8 cents to make a MAC eyeshadow SKU (including all packaging) vs the $15 retail price. Hence why more and more fashion houses, like Hermes, Gucci, Burberry, have been coming out with their own beauty lines the past few years, you cant ignore those lucrative margins

 

[TPFer2015]

I’m not sure this is entirely correct. The Pierre Wertheimer initially invested in the perfume business only. Then after Coco was forced out of France and wanted to return to her couturier and leather business, she negotiated the lawsuit she had brought against him pre-WW2 because she needed money. That’s when they got I think 80%ish of the whole company.
The Wertheimers are VCs and they have Chanel, along with all of their other companies under Mousse Partners. They are moving more toward healthcare & biotech. But they are invested or own 61 companies. Chanel being only one of those.
I do find it interesting that the CEO that you reference came from Unilever as @880 stated. That’s something I was unaware of. Unilever is of my direct report’s accounts. So that is very worth exploring.
Thanks a lot, now I’m down the rabbit hole on this and it’s totally OT. Sorry OP.

Indeed Mousse Partners is the W's family office, which holds plenty of other investments including Chanel. Lovely offices complete with Chanel-branded office chairs

 

[papertiger]

I’m not sure this is entirely correct. The Pierre Wertheimer initially invested in the perfume business only. Then after Coco was forced out of France and wanted to return to her couturier and leather business, she negotiated the lawsuit she had brought against him pre-WW2 because she needed money. That’s when they got I think 80%ish of the whole company.
The Wertheimers are VCs and they have Chanel, along with all of their other companies under Mousse Partners. They are moving more toward healthcare & biotech. But they are invested or own 61 companies. Chanel being only one of those.
I do find it interesting that the CEO that you reference came from Unilever as @880 stated. That’s something I was unaware of. Unilever is of my direct report’s accounts. So that is very worth exploring.
Thanks a lot, now I’m down the rabbit hole on this and it’s totally OT. Sorry OP.

I don't think I would say anything to the contrary. Chanel made the deal with Pierre and Paul Wertheimer in 1924 for mass producing the scent, allowing them 70% for most of the work, she ended up keeping 10% for basically choosing the scent and sticking her name on the bottle. Rhianna only keeps 15% of Fenty profits, it's not the worst deal. She tried her best to get wiggle out of the deal using Nazi legislation and even counterfeited her own products (for which she was never sued by the W family for). When she renegotiated in 1947 she took a huge lump-sum and took a cut on points (2% WW).

Anyway, OT, but the point is, make lots of money from handbags (amount other things) but since most of their profit (IMO) comes from beauty, skincare, and fragrances it's not the worst of calamities for them if new lines don't work out. I think Chanel need to rethink and redesign of the 19 (at least the tote) and 22 design as well as the finishing process for their leather goods. A huge part of the appeal of the brand is (sorry to say this) the resale value. If things (besides CFs) don't last even a season and can't be sold on to partly recoup the initial outlay I do think it will have a huge impact on the band overall.

 

[bagsaremyjam]

I

Then please don't make blanket statements like the above when you cannot back them up. No one asked you to judge me personally about my spending history, and this is my thread, so your judgment of what is and isn't ok on this thread is completely irrelevant. It was deleted BECAUSE it was inappropriate, disrespectful and, as it was conveyed "starting drama". Take the L please and move on.

I didn’t see that as disrespectful and neither did the moderators. “Starting drama” and being inappropriate or disrespectful are not remotely the same. Calling you out for bragging could be deemed a bad judgement call. Personal, yes, and off topic. I think disclosing finances is inappropriate.

I don’t think it qualifies under the blanket statement you’re referring to.

 

[gail13]

I'd just like to add that Chanel has a very powerful story about Coco and her beginnings; they count on that to sell the product. As you learn more about the brand it may not be all that you thought it was. Chanel counts on having customers maintain quality etc is superb and there are some that will defend it to the end. If the brand were to pop up today and we had VV who had just taken over from Karl, what are we looking at? We have the Wertheimer's who are VC, we have VV who worked alongside Karl, what else makes one want to buy the brand? Im asking in all seriousness.

Hopefully as a result of this forum which encourages people to share information, we can be better consumers and buy smarter. Wether its $6k on a bag or RTW, thats alot of money and I think all of us expect it to be among the best there is. I'd like a brand to have more than a story to it.....

 

[TraceySH]

I

I didn’t see that as disrespectful and neither did the moderators. “Starting drama” and being inappropriate or disrespectful are not remotely the same. Calling you out for bragging could be deemed a bad judgement call. Personal, yes, and off topic. I think disclosing finances is inappropriate.

They are synonymous. And how else does one attain any sort of status with a company like Chanel if not for mass expenditures?

I will say the below and proceed to then hit the ignore feature for you as I have suggested many others do here.

In the pages and pages of this thread, you’re the only one who continues to argue without a shared goal of community learning. You preach yet are wrong many times with your absolutes. You flagrantly dismiss knowledge from those that have gone before you and have decades of experience (and statuses) beyond yours.

The only thing I can logically ascertain is your need to have the floor as the subject matter expert on all things luxury. And in that vein, I suggested you begin your own thread that focuses on your very unique and trademarked knowledge that we seem to not currently possess over here on this thread.

That way, all eyes will be on you uniquely to share without the irritation of opposing viewpoints.

Let’s focus on those here who do have substantial and credible knowledge, whom I have learned a great deal from in this thread. Thank you @ntntgo @gail13 @papertiger @880, you guys are amazing.

 

[bagsaremyjam]

They are synonymous. And how else does one attain any sort of status with a company like Chanel if not for mass expenditures?

I will say the below and proceed to then hit the ignore feature for you as I have suggested many others do here.

In the pages and pages of this thread, you’re the only one who continues to argue without a shared goal of community learning. You preach yet are wrong many times with your absolutes. You flagrantly dismiss knowledge from those that have gone before you and have decades of experience (and statuses) beyond yours.

The only thing I can logically ascertain is your need to have the floor as the subject matter expert on all things luxury. And in that vein, I suggested you begin your own thread that focuses on your very unique and trademarked knowledge that we seem to not currently possess over here on this thread.

That way, all eyes will be on you uniquely to share without the irritation of opposing viewpoints.

Let’s focus on those here who do have substantial and credible knowledge, whom I have learned a great deal from in this thread. Thank you @ntntgo @gail13 @papertiger @880, you guys are amazing.

Actually I’ve admitted multiple times when I’m wrong. In fact, if you go back through, I even admitted so in regards to the thread with you.

You’ve told multiple people to mute me, I didn’t even realize I could do that. I’d love to do that with you as well. I’ve had people reach out to me in regards to you and other threads you’ve started. You seem to want everyone to believe everything you write but laugh off opposing views. Meanwhile, there have been plenty of people who’ve provided good insight, whether I’m with their POV or not.

I’ve not trying to have the floor, it’s frustrating seeing blanket statements made everywhere on this thread. I’ve never not agreed with the quality issues that can come with Chanel, but delegating this brand to trash as many of you have said, and comparing it to fast fashion, is not constructive and just plain wrong. But so many of you continue to purchase. The irony.

 

[gail13]

They are synonymous. And how else does one attain any sort of status with a company like Chanel if not for mass expenditures?

I will say the below and proceed to then hit the ignore feature for you as I have suggested many others do here.

In the pages and pages of this thread, you’re the only one who continues to argue without a shared goal of community learning. You preach yet are wrong many times with your absolutes. You flagrantly dismiss knowledge from those that have gone before you and have decades of experience (and statuses) beyond yours.

The only thing I can logically ascertain is your need to have the floor as the subject matter expert on all things luxury. And in that vein, I suggested you begin your own thread that focuses on your very unique and trademarked knowledge that we seem to not currently possess over here on this thread.

That way, all eyes will be on you uniquely to share without the irritation of opposing viewpoints.

Let’s focus on those here who do have substantial and credible knowledge, whom I have learned a great deal from in this thread. Thank you @ntntgo @gail13 @papertiger @880, you guys are amazing

+1

 

[880]

You may not have taken it the wrong way, but for someone to tell me what kind of bag I own when

I’m not looking to argue,

Writing can intensify words when written quickly and directly and is void of inflection, so I guess that doesn’t help

I’m confused how it was disrespectful.

@bagsaremyjam,

On their face, your comments are aggressive personal attacks even to those who are not directly in crossfire. And this is while you accuse others of the same.

You feel insulted by a comment that is considered benign and happens to add information to the thread. Simply bc it is about a bag that belongs to you.

Rather than respond so, TPF generally advises that one press ignore; take it to PM; or, report the comment for deletion so as not to interrupt thread continuity. This should not be taken personally; most of us have been moderated.

ETA: I may disagree with members like OP and decide to tell them so, or refrain, but it’s inappropriate to accuse anyone of bragging re purchases. I mean this is TPF. We all secretly want to know what others spend if only to feel virtuous when we look at our own Amex bill

 

[bagsaremyjam]

@bagsaremyjam,

On their face, your comments feel overly contentious, aggressive, and impolite to even those who are not directly in crossfire. Sadly the tone dilutes some of the interesting knowledge you impart.

It appears that you feel insulted by a comment that is considered benign and happens to add information to the thread. Simply bc it is about a bag that belongs to you.

Rather than respond so, TPF generally advises that one press ignore.

Thank you. I respect and appreciate what you’re saying. If I’m coming off that way it was never my intent and I can’t ignore that I’m coming off a certain way to multiple people.

The comment may seem benign because it’s a bag that belongs to me, but if you read through the thread I have a fashion background. So it was taken personally that I wouldn’t know the difference because a bag that costs an obscene amount of money (re: crocodile) I purchased to a croc embossed leather. Maybe to others it’s not a big deal, but for someone who has a fashion background it’s a big deal. Maybe harder to understand if you’re not in that realm. Also, the box of my bag has the name on it, which is a Cocodile Gabrielle. Having to go back and forth was frustrating as I literally have the information right in front of me. I felt like my intelligence was being questioned.

I’m passionate and have a lot of knowledge and certainly do not act like I know everything. I’ve admitted openly here when I’ve realized I was wrong. I also don’t believe that more spending power and purchase history necessarily equates to more knowledge of fashion. Some yes, but not always. I think some of the same arguments made about me can equally be made back to the person from which they came.

I’m on and off TPF so I didn’t realize I could ignore someone. I wish I could’ve ignored comments long ago but felt the need to respond, which annoys me as much as it may have annoyed others. But I will be using that feature moving forward.

 

[ntntgo]

I don't think I would say anything to the contrary. Chanel made the deal with Pierre and Paul Wertheimer in 1924 for mass producing the scent, allowing them 70% for most of the work, she ended up keeping 10% for basically choosing the scent and sticking her name on the bottle. Rhianna only keeps 15% of Fenty profits, it's not the worst deal. She tried her best to get wiggle out of the deal using Nazi legislation and even counterfeited her own products (for which she was never sued by the W family for). When she renegotiated in 1947 she took a huge lump-sum and took a cut on points (2% WW).

Anyway, OT, but the point is, make lots of money from handbags (amount other things) but since most of their profit (IMO) comes from beauty, skincare, and fragrances it's not the worst of calamities for them if new lines don't work out. I think Chanel need to rethink and redesign of the 19 (at least the tote) and 22 design as well as the finishing process for their leather goods. A huge part of the appeal of the brand is (sorry to say this) the resale value. If things (besides CFs) don't last even a season and can't be sold on to partly recoup the initial outlay I do think it will have a huge impact on the band overall.

Thank you for the additional information. I actually didn‘t realize that yoir original post that I responded to was about Chanel beauty. I also didn’t know that it had been separated from Chanel Ltd. So thank you for that also. I don’t buy their beauty products anymore since they discontinued my lip color, as seems to happen every time I find a signature lip color.
I think we can always learn something from others. What’s the saying “Once you stop learning you start dying”?
Your statement about the resale value driving sales is so spot on. i do think that we are starting to see that happen with FP rescinding offers on bags, as someone stated.
I wish we could go back to the days of excellence in quality and Chanel is not the only culprit but they’re definitely at the forefront due to the rise in prices in comparison.
Nice to see you again after my absence from TPF for so many years.

 

[papertiger]

I'd just like to add that Chanel has a very powerful story about Coco and her beginnings; they count on that to sell the product. As you learn more about the brand it may not be all that you thought it was. Chanel counts on having customers maintain quality etc is superb and there are some that will defend it to the end. If the brand were to pop up today and we had VV who had just taken over from Karl, what are we looking at? We have the Wertheimer's who are VC, we have VV who worked alongside Karl, what else makes one want to buy the brand? Im asking in all seriousness.

Hopefully as a result of this forum which encourages people to share information, we can be better consumers and buy smarter. Wether its $6k on a bag or RTW, thats alot of money and I think all of us expect it to be among the best there is. I'd like a brand to have more than a story to it.....

IMO, we have a story of one of the early 'boss lady' pioneers who was also a thoroughly Modern women. Although not born to privilege she seemed to be able to put her ingenuity, self-discipline and marketing skill to good use, as well be able to 'make friends and influence people'.

We have the inherited fashion vocabulary of Chanel herself and Karl's reinterpretation (he said himself she would have hated most of the things he designed). How many brands have borrowed from Chanel recently including Gucci, Saint Laurent (check out SLP's AW21 tweed suits, metallics and separates (1,2, 3 & 4) against Chanel AW1994 (5). Serious or ironic, Chanel pieces remain Chanel, even after their creators' deaths, even with a different label.




I didn't enjoy so much of VV's first seasons in charge TBH. Sometimes, there's barely one outfit I'm drooling over - and that's in the couture shows (I'm good at dreaming). It's good to have a woman designing for women so we will have to be patient Not of all of Karl's stuff was always that great either. Seeing the pieces on real women like @880, @ari and @periogirl28 is actually an eye-opener because they translate quite well to real life more than are suited to the catwalk.

Wertheimer family have been running Chanel as a growing concern for 51 years and we have them to thank for allowing Karl such a free hand as Head Designer. When Chanel died in the early 1970s, her clientele were not the fashionable set at all. So long as there is value placed on quality not just profit (thread notwithstanding ) and continue to support Causse Gantier and other exceptional standard businesses, there'll always be something. I guess we need to know/understand quality and stop being duped by all the latest pretty shiny things just cos it's (I will only buy very vintage Chanel costume jewellery) Chanel will have a place.

 

[bagsaremyjam]

@bagsaremyjam,

On their face, your comments are aggressive personal attacks even to those who are not directly in crossfire. And this is while you accuse others of the same.

You feel insulted by a comment that is considered benign and happens to add information to the thread. Simply bc it is about a bag that belongs to you.

Rather than respond so, TPF generally advises that one press ignore; take it to PM; or, report the comment for deletion so as not to interrupt thread continuity. This should not be taken personally; most of us have been moderated.

ETA: I may disagree with members like OP and decide to tell them so, or refrain, but it’s inappropriate to accuse anyone of bragging re purchases. I mean this is TPF. We want to know what others spend if only to feel virtuous when we look at our own Amex bill.

Continuing to the end of your edited comment…

To me there’s a tasteful way of going about bragging and what’s expected here. I want to see what people are buying and am curious when people have certain access with certain statuses, and if asked how much something is I find it totally normal for someone to disclose.

But I personally find it distasteful and lacking tact to tell people (who haven’t asked) that you spent a million dollars in bags, spent three million on jewelry, etc, etc. You get what I’m saying. There’s a difference.

 

[HauteRN]

Continuing to the end of your edited comment…

To me there’s a tasteful way of going about bragging and what’s expected here. I want to see what people are buying and am curious when people have certain access with certain statuses, and if asked how much something is I find it totally normal for someone to disclose.

But I personally find it distasteful and lacking tact to tell people (who haven’t asked) that you spent a million dollars in bags, spent three million on jewelry, etc, etc. You get what I’m saying. There’s a difference.

We are all different; there are so many great things about that. Imho, you're making this personal on both how you're receiving and how you're reacting. One might also find it disrespectful and lacking tact to continue going after someone.

I say this with care: sometimes it's best to think something, but not let it cross your lips or keyboard.

 

[880]

+1 with @HauteRN

@gail13 , @papertiger ,

The wertheimers ‘forgave’ chanel and I thought supported her for the rest of her life bc it was great business practice to do so. Like it or not, her imprint lends value to the Brand. And, for all of the wailing re standards slipping on bags or RTW, that’s true of many premier brands. Chanel is hardly alone.

After all this, I’m embarrassed to say, I haven’t entirely ruled out the 22 bag.

The 19 tote that I handled at the boutique also looked good, but I don’t really even use the totes I own.

I don’t think chanel cares about the social media complaints. Bc it’s still exposure to zillions. Once the client is in the store, she might be curious enough to look at a 19, but she is also likely to pick up lots of other things

I go back and forth as to whether or not to hunt up a GST at resale. I remember it as being THE mom bag of its day as well as being really amazing quality for a relatively low price. It’s just that it’s so aggressively caviar, and I’m not.