“When CHANEL CF was around 50000 to 60000 yuan, she could still grit her teeth to buy it, but now it’s too expensive to buy it.” Ms. Lu, who watched Chanel’s price increase all the way, felt that she’s “not worth it” anymore. “The price increase is so fierce, and it feels like the brand is gradually raising the threshold and screening customers. People who need to grit their teeth to buy bags, or those who only buy bags but not ready to wear clothes, have been abandoned by the brand.”
By raising prices, Chanel has gradually squeezed into Herm è s‘ price range, especially classic bags such as CF and 2.55, which have been rising year by year and becoming increasingly expensive. No wonder many consumers have expressed that “it’s better to buy Herm è s with this money!”.
However, some consumers have also expressed that it is more difficult for Herm è s to hold a bag, and classic bag styles need to be stocked, and not just a small amount.
Many analysts believe that high net worth individuals have become the main consumers of luxury goods, and luxury brands need to screen out more valuable consumers. The middle class, who used to purchase beauty, accessories, and entry-level bags, are now experiencing a decline in purchasing power.
So in recent years, when the price adjustment measures of various luxury brands become more frequent and the price of new products becomes higher and higher, all kinds of losses and roast rise and fall on social media.
“For luxury brands, quality is extremely important. We don’t adjust prices just for the sake of adjusting prices. More exquisite products come with higher costs and naturally higher prices,” said Bruno Pavlovsky, President of Chanel’s Global Boutique Division, in a media interview last year.
It is worth noting that Bruno Pavlovsky has stated that although top consumers are still making purchases, the traffic and sales of brand stores have decreased, and Chanel is preparing to face an even more difficult year in 2024.
However, in response to Chanel’s controversial price increase, Bruno Pavlovsky continued to link the price increase to challenges such as global inflation and fierce industry competition, and hinted that the brand would further increase prices, consistent with lower inflation rates. “Our goal is not to become the most expensive luxury brand, but to ensure that prices match the brand’s positioning, and we don’t want anyone to be disconnected from the brand.”
He said, “Chanel has different categories of products and price bands, which allows us to connect with different types of consumers and provide them with different experiences.” These products include ready to wear clothes, handbags, shoes, earrings, scarves, and lip gloss priced at 380 yuan.
