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

[QuelleFromage]

In Denmark the prices were increased as well.
Europeans actually do buy Chanel. We don’t like the price hikes either.

Thanks for the info. And I should have said the Parisians. My apologies.

I live in Paris, and the classic Chanel flap in all sizes is extremely popular among Parisians. I see it and the 2.55 more than I see Hermès bags.

This actually shifted me toward buying one (to date I've only owned a couple 2.55s and a WOC), but this thread has pretty much talked me out of that!

 

[Mad_la_mans]

They use price harmonization as the excuse. That’s their go-to explanation for every price increase, globally. Either they don’t understand the purpose of moving from value-based pricing to harmonized pricing or they think we don’t.
All of the luxury brands who have moved to price harmonization in the last 11 years have done it for two reasons. Either they are stabilizing their pricing to go e-comm or to sell.

Anyone willing to pick up a book and educate themselves or who has been watching the Chanel trends over the last 5 years, can easily see that it’s likely the latter. However, Hermes dipping their toe into the e-comm arena with bags, some of which are quota bags, makes me think we might see Chanel start doing the same. Especially with the ”VIP boutiques” being announced. Notice it’s in quotes. They already exist within the current boutiques.

Regarding the EU price increase, it has no effect on residents of the EU countries as they don’t buy Chanel anyway, only expats. I noticed that the prices weren’t raised in Switzerland or Norway or Denmark or pick any country that’s part of the EU but doesn’t use the Euro. All of those countries’ currency are at the same rate against the USD. I‘ve also heard nothing about a price increase in the UK. That’s will give us way more insight to what their real endgame is. If any of our UK members here know differently, please chime in.

Both Europeans, and Parisians do buy Chanel we're just not as active on the forums or FB groups The price increase also happened in Prague (Czech Republic) a member of the EU, but hasn't adopted Euro.

 

[MrsMega]

Thanks for the info. And I should have said the Parisians. My apologies.

I don't agree, us Parisians also buy Chanel.

 

[BreakfastCake]

Regarding the EU price increase, it has no effect on residents of the EU countries as they don’t buy Chanel anyway, only expats.

Why would you say that EU residents don’t buy Chanel? Do you really think that?

 

[ntntgo]

Selective e-commerce, yes - for fragrances, make up, etc. Not for ready-to-wear or bags.

Bruno Pavlovsky stubbornly explains in this video why they won't expand e-commerce, at the 12:20 mark.

Just like Hermès, Chanel understands and knows scarcity marketing. If they do go fully e-comm, it will be to their detriment.

Incidentally, despite expanding their e-comm offering, Hermès sales are not near Chanels, whose figures came close to LVMH last year.

Let's be honest here: the allure of CHANEL is keeping its access very INaccessible. Scarcity marketing cultivates desire. It's a proven psychological phenomenon and that's why Hermès' game works. People want it more when they cannot get it easily. Exclusivity sells.

I respectfully ask for further clarification of the statements in your post.

Chanel already sells makeup, sunglasses, etc on their site now. When I said selective e-comm I meant SLGs, seasonal bags. That type of product.
So could you clarify if you were saying that only what they already sell on their site is all that we’ll see?

Also, I’m curious as to where your annual sales figures came from regarding Chanel, who does not put out an annual report and the comparison to LVMH, who had over €64 billion in revenue in 2021. I’m pretty clear on LVMH as they are one of my clients.

Also, LVMH owns almost 15% of Hermes. Just throwing that out there.

Thank you in advance for your clarifications.

 

[ntntgo]

I don't agree, us Parisians also buy Chanel.

My apologies. I shouldn’t have generalized.

 

[ntntgo]

Why would you say that EU residents don’t buy Chanel? Do you really think that?

I already addressed this in a previous reply.

 

[JamaisAssez]

Chanel already sells makeup, sunglasses, etc on their site now. When I said selective e-comm I meant SLGs, seasonal bags. That type of product.
So could you clarify if you were saying that only what they already sell on their site is all that we’ll see?

Thank you for clarifying, I thought by selective e-comm you were referring to their current offerings. You're perhaps right in saying that they will offer SLGs and seasonal bags on websites to weed out the "rats" in the boutiques. @TraceySH

Also, I’m curious as to where your annual sales figures came from regarding Chanel,

Thank you for giving me the opportunity to clarify. I was wrong in comparing a single house against a conglomerate, whose revenue is way higher than Chanel's since they are made up of so many brands.

https://services.chanel.com/media/files/Press-release-2021-Results-ENG-FINAL.pdf

15,6 billion euros. I believe higher than Gucci, Dior and Hermès, probably close(r) to Louis Vuitton (the brand not the conglomerate).

 

[ntntgo]

Thank you for clarifying, I thought by selective e-comm you were referring to their current offerings. You're perhaps right in saying that they will offer SLGs and seasonal bags on websites to weed out the "rats" in the boutiques. @TraceySH

Thank you for giving me the opportunity to clarify. I was wrong in comparing a single house against a conglomerate, whose revenue is way higher than Chanel's since they are made up of so many brands.

https://services.chanel.com/media/files/Press-release-2021-Results-ENG-FINAL.pdf

15,6 billion euros. I believe higher than Gucci, Dior and Hermès, probably close(r) to Louis Vuitton (the brand not the conglomerate).

Thank you for that link however, that isn’t an annual financial report. If you read the fine print at the bottom of the last page, it refers everything back to their financial statement which is nowhere to be found.

Regardless, I have two takeaways from that. 1.) My global account directors include more relevant information and write a more professional annual account review than that. It reads like it was written by a high schooler
2.) As they don’t put out an actual annual report, I question the 170.6% increase in operating profit year over. If that’s accurate then everyone who buys from Chanel should reevaluate their spending.

Sincerely though, thank you for both your clarifications and the link.

 

[periogirl28]

I am glad I bought my tiny collection of 6 CFs about a decade ago, only added all of 3 bags, in the last 4 years. I have mainly been a very minor RTW customer since 2012, but now only buy the RTW which I don't think is shedding/ full of tinsel, logos / 90% polyester. Am cutting down on Chanel everything including perfume, makeup and eyewear due to many QC issues and the threads here have informed me very well on possible bag issues also. Once upon a time Chanel stood for something with me, but I do think I was always aware of the problems and have never really bought totally into the marketing/ hype/ romance. Even CS seems to have been more sincere back then with the gifts, makeup, show invites and flowers etc. Now we are obviously paying with the big price increases for all the influenzas (not a typo there), multiple repeat worldwide events, more celebs of all sorts and more frequent client events and gifts. Am ready anytime to walk away from Chanel, even if I do feel comfortable and welcome at R Cambon and in my home stores around the world, if I decide to. I have certainly been fortunate with my various experiences attending events and am quite satisfied with my small collection.

 

[minnnea]

2.) As they don’t put out an actual annual report, I question the 170.6% increase in operating profit year over. If that’s accurate then everyone who buys from Chanel should reevaluate their spending

The refenrence year for 170,6% was first pandemic year with lock downs and no travel so I think it makes sense. Though without mentioning it does seem a bit… well too good.

 

[gail13]

Has anyone noticed Chanel likes to use the term Savoir Faire: The meaning of which is to know,
or:
-the ability to act or speak appropriately in social situations. I'm trying to understand what this has to do with the products.

Per Philippe Blondiaux:
“This very strong financial performance reflects the strength and uniqueness of the CHANEL brand focused on creation and sustained commitment to enhance our savoir-faire, while transforming our business model to have a positive impact and achieve our sustainability ambitions. The passion and engagement of our teams around the world is a key pillar of this success.

I also see this in the statement referred to above:
"Chanel is dedicated to ultimate luxury and to the highest level of craftsmanship." I wonder how they define these within their own company.

 

[AChanelADay]

I have been told by one of my SA's that Chanel believes the higher the price, the more we want an item. It has zero to do with quality.

Some took issue with my comments about Chanel or others like them being considered "fast fashion". However, at the rate of these collections releasing, one barely gets the items before the value falls and its onto the next. With some 8 or 9 collections inc Coco Neiege etc, that's a new bag or RTW about every 1.5 months. As Ntntgo says, its about the hunt. We are not used to a Chanel everyday bag, holding up to wear and tear. Isn't that what the 22 and the 19 style bags are supposed to be?

It appears the 19 flap bags are quite sturdy, but what is this kryptonite material?

Is it possible Chanel does not want to provide an everyday bag that will hold up? Wear and tear is the cornerstone of consumerism. If we are all buying bags that are not able to sustain everyday wear, that explains how wear and tear has caused the damage. Most of the people on this forum treat their lambskin and metallic bags very delicately. Thats a collectible that belongs in a museum. And many of us including myself have these. I've got bags that have rarely if ever seen the light of day.

I guess we ask ourselves, do we want a bag we want to use or one we look at in the closet?

Chanel has too many collections. It's a money grab.

 

[ntntgo]

The refenrence year for 170,6% was first pandemic year with lock downs and no travel so I think it makes sense. Though without mentioning it does seem a bit… well too good.

The issue I have with that .pdf is that it’s not an actual annual report which is required. I own a much smaller company and even I have to register an annual report.

More importantly is the reference to their “financial statement” in the fine print at the bottom. Where is that financial statement? I’d love to see it if anyone can find it as it would be included in their annual report, if they actually put one out as they are required to.

Somewhere back in this thread, someone mentioned them being fined for not doing so. It wasn’t me but I can tell you as someone who has owned 3 companies, one quite large that was sold off, I was fined one year for not uploading my annual report. So I don’t doubt it. I even searched for it under Mousse Partners, the holding company that Chanel falls under and according to the SEC, they haven’t even filed them. To be clear, Mousse Partners Ltd is registered with the SEC. They run on a fiscal year, not calendar and it ends on Dec 12th. According to the SEC, they’ve filed no papers since they made the change to Litor Ltd as being the DBA as Mousse. I suspect they did that as they incorporated in the Caymans but, as they are registered with the SEC, they are still required to file an annual report.

 

[alxyoung]

Has anyone noticed Chanel likes to use the term Savoir Faire: The meaning of which is to know,
or:
-the ability to act or speak appropriately in social situations. I'm trying to understand what this has to do with the products.

Per Philippe Blondiaux:
“This very strong financial performance reflects the strength and uniqueness of the CHANEL brand focused on creation and sustained commitment to enhance our savoir-faire, while transforming our business model to have a positive impact and achieve our sustainability ambitions. The passion and engagement of our teams around the world is a key pillar of this success.

I also see this in the statement referred to above:
"Chanel is dedicated to ultimate luxury and to the highest level of craftsmanship." I wonder how they define these within their own company.

It can be translated to know-how. In this sense, I would say craftsmanship .