Luxury Prices Slashed??? I could only hope Chanel follows suit!!!

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  1. In the Lap of Luxury, Paris Squirms

    http://www.nytimes.com/2009/01/15/fashion/15paris.html?_r=1&partner=rss&emc=rss
    Published: January 14, 2009


    Ed Alcock for The New York Times
    Fauchon food store, which has noticed a softening in sales of some items.
    FRANCE is the birthplace of luxury fashion, and here the recession biting the world has the feel of a morality play.

    As high-end consumers everywhere have suddenly suppressed their appetite for luxury goods, what was once considered a recession-proof industry has been hit hard.

    High-end stores in the United States watched in horror as holiday sales tanked, while in Tokyo, Louis Vuitton canceled plans for what would have been its largest and most glittery store anywhere.

    For the French, each wave of bad news has brought high anxiety here.

    When Chanel recently announced the layoff of 200 temporary employees — only slightly more than 1 percent of its 16,000-member work force — the daily newspaper Le Parisien called the news a bombshell.

    The television channel LCI described the move as the most serious setback to the company since Coco Chanel fired her entire staff and closed shop when war broke out in 1939.

    But there is also, paradoxically, an underlying satisfaction here that an era of sometimes vulgar high living is over and that a more bedrock French way of life will emerge.

    Only in France is the recession lauded for posing a crisis in values.

    A recent issue of Le Figaro Magazine featured a 12-page guide to scaled-down living in 2009, with predictions that people will work less and put family (even in-laws) first. A French trend expert quoted in the magazine dramatically described the changes as nothing less than “a revolution in values.”

    Alain Némarq, the chairman of Mauboussin, the prestige jewelry firm, noted in an interview that saving the luxury industry should be an important national priority because it employs 200,000 people in France, is part of French heritage, brings prestige to the country and seduces not just the “happy few” but a large swath of the public.

    Rather than trying to keep the machine running by pumping out high-price hand bags, watches and other goods, he proposed the unthinkable: the entire luxury industry should slash prices. “We need a return to reason, decency, discretion, beauty and creativity — in other words, to true values,” Mr. Némarq said.

    (Mauboussin has led by example. It has sold its one-carat diamond solitaire “Chance of Love” ring for about $14,500, roughly a third less than its normal price, and its lower-end 0.15-carat diamond ring was priced at $895, Mr. Némarq said.)

    Some French intellectuals want to go much further, calling for the death of the entire luxury industry as a sort of national ritual of purification.
     
  2. I was just reading this on the NYT - we can only hope ! :graucho:
     
  3. I know-it is amazing to see how ready the whole country is for a purging of sorts-what amazed me was that there was enough profit in the diamond ring that he could afford to slash the prices!!!
     
  4. I was suspicious all along that it could not cost 1,000. to make a mono or flap bag and then they always have 3x markup so it seems like an outrageous price-I hope they are forced to lower the prices-maybe we should all go on a Ban/Strike like they do when Gas gets too high and force them to lower the prices-It would probably not take more than 6-12 months and then we could all buy when the prices drift down!!!
     
  5. But a fellow member just posted that there would be a price increase come Monday in UK. :sad:
     
  6. I hope that is not true!!!:nuts:
     
  7. Maybe this is why:Chanel says "They are Fine???

    This whole crisis is like a big spring housecleaning — both moral and physical,” Karl Lagerfeld, the designer for Chanel, said in an interview. “There is no creative evolution if you don’t have dramatic moments like this. Bling is over. Red carpety covered with rhinestones is out. I call it ‘the new modesty.’ ”

    Still, Mr. Lagerfeld is quick to point out that his house is doing just fine, that the layoffs this month were blown out of proportion and that Chanel’s Paris-Moscow collection last month brought in 17 percent more in sales than his Paris-London show in 2007.
     
  8. Interesting piece, thanks for posting. Let's face it chanel have got ridiculously greedy. I actually think the price increases of the last couple of years have been disgusting and indefensible(I know LV and others have done it too on a smaller scale). I was all set to start buying chanel in 2007, but they started those major increases and I just can't bring myself to buy now. I adore chanel, but will only buy vintage bags as much as I'd really love a reissue. I really doubt that they will ever lower prices though because it seems to me those increases were for the sake of prestige (aka keeping the rif raf out). Even if less people are buying the bags, they are making a very tidy profit one each piece. This is all JIMHO though of course.
     
  9. Some people refuse to believe it's going to affect THEM. Sounds like Karl is among that some. When you're so well insulated from reality, one has no need to acknowledge what is happening out in the real world. As much as I've loved Chanel in the past, it's difficult to spend $3K on a purse. I know the cost of production did not double. If anything they've found ways to cut costs as is exhibited by the enormous increase in defective merchandise and the "new" but not improved, imho, construction of the purses. I specifically detest the flat quilting on the classic flaps.

    Time will tell how this will shake out. It grieves me not if CEOs, CFOs are forced to take a more realistic income -- and if not, then go out of business.
     
  10. Excellent point! I was thinking that myself.
     
  11. It maybe delayed reaction but hopefully they will cut prices by the end of this year...
    that would be awesome.. i'm holding off till then hehe
     
  12. "And for Mr. Lagerfeld, cutting back his own spending at Chanel is not part of his “new modesty” strategy. He said he is not being forced by the private company’s owners to bend or adapt because of financial constraints. “We have no budget, we do what we want and throwing money out the window brings money back in through the front door,” he said. “The bottom line is that I don’t deal with the bottom line. The luxury in my life is I never have to think about it.” '

    Is anyone kind of turned off by this comment? I understand that certain things are priceless and for some people when pursuing a lifestyle or art there is no budget but for some reason this comment bothers me a lot...
     
  13. I think the price adjustment in the UK is a result of the falling pound-- I think in another thread people were buying in the UK and shipping to the US to take advantage of the price difference.
     
  14. considering his background it doesn't surprise me. like a spoiled child, never has to worry.
     
  15. i can hope like u guys but i hardly see it happening, at least not anytime soon.