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Executive Summary Chanel is an established luxury fashion and beauty company in France, founded by the stylish Coco Chanel, famous for revolutionizing womenʼs fashion and introducing timeless elegance and style. Apart from a long history, Chanelʼs strength also lies in cult designer Karl Lagerfeld who never fails to interest consumers and a management team that is highly effective in preserving and promoting the brand image and attuned to consumerʼs needs and market trends. Chanel will no doubt retain her powerful market positioning by continuing the excellent job she is doing. To expand her market share, she can increase emphasis on new media marketing and consider e-commerce, something that competitors are already venturing into. This paper seeks to analyze Chanelʼs performance, and provides recommendations for what can be improved to further expand Chanelʼs global power.

2. Company Background and History

Chanel is a Parisian fashion house founded by Gabrielle "Coco" Chanel, recognized as one of the most established in haute couture, specializing in luxury goods. Chanel has always specialized in items such as simple suits, dresses, women's pants, and costume jewelry. Coco Chanel's designs and creations are timeless, considering the basic silhouettes have remained consistent from generation to generation. According to Forbes, the privately held House of Chanel is jointly owned by Alain Wertheimer and Gerard Wertheimer. They are the grandsons of the

jewelry and watches. elegance. Chanel S. which is their forte.3 billion estimate value of the sectorʼs $35 billion. skin care. There are more than 390 shops worldwide. Gucci. shoes. Since 2002. Chanel cosmetics are targeted at a younger consumer but they still retain the “classic” market. shoes. handbags. Industry Analysis  Target Audience Chanel customers are women who want to identify with what Chanel represents which is. The brand produces and retails handbags. was founded in 1909 and is headquartered in Neuilly sur Seine. This is the companyʼs outlook. with a $10.early Chanel partner Pierre Wertheimer. Chanel is targeting women between the age 18 – 39. France with over 200 boutiques worldwide.S. There are 425 Gucci stores worldwide. other leather goods. jewelry and watches. supported by the high end pricing of the products and a strong brand image which consumers perceive. Chanel S. 3.A. simplicity. cosmetics.  Market Sector Chanel is enjoying an established presence in the designer and haute couture sector.  Competitor Analysis Louis Vuitton. established since 1854. an Italian company based in Netherlands.S. financial experts estimate that Chanel has approximately one-third share of Franceʼs fashion and luxury goods sector in 2008. ready-to-wear clothing. and other accessories. is one of the main divisions of LVMH. . manufactures. clothing. modernity.A.  Market Positioning Chanel has a strong market positioning within the luxury fashion goods sector. The brand produces and retails luggage. with the launch of Chance perfume. Drawing on an audit by Swiss and Cayman Islands tax services. and retails fashion and beauty products. and class. designs. other leather goods.

lost 11% of its brand value over the past 12 months. Hermes and Gucci . the top three luxury brands . 4. acknowledgement and training for new products. who famously said “fashion passes. to differentiate them with their service. High-quality: Beauty is in the details. But Chanel. 2. However they specialized in leather while Chanel did not. at number four. Excellent Management: Training for Chanelʼs associates is critical.  Threats 1.Louis Vuitton and Gucci are strong competitors because like Chanel. like China. keeping the consumerʼs interest in Chanel. conveys a very strong message of Chanelʼs timeless elegance style. Chanel must consider increasing marketing in this area in order not to be obsolete. 3.Cult Designer Karl Lagerfeld: Always reinventing Chanel. who hold the largest share in luxury cosmetics. specifically China and India. Customers will need to make calls or personal trip to store to find out prices. Counterfeit goods: A prevalent issue that can be difficult to distinguish and control. Always daring to try something different for each show. Limited geographic coverage: Chanel boutiques are known to be exclusive and large-scale however they are missing out on expanding in many critical places in Asia.  Weakness 1. Expanding deeper to the Asian market: There is huge economic growth in Asia. 2. Strong brand image: The story of stylish Coco Chanel. According to the Brandz valuation 2010. Chanelʼs notable competitors would include LʼOrealʼs Lancome. they have a very strong brand image conveyed by the easily recognizable logos. Chanel can consider opening up more flagship stores to meet the increasing demands for luxury goods. Chanel is famous for her tweed fabric.Louis Vuitton.  Opportunities 1.all enjoyed significant increases in brand equity. he is known to have changed nothing yet everything about Chanel. They compete keenly with Chanel in terms of sales of handbags and accessories. Website: Does not provide prices. Consultants are sent to Paris to understand the heritage of the house and gathered for a conference for updates.Estee Lauder and LVMHʼs Christian Dior. style remains". embroidery. chain and button. . 4. Tap on technology: Youths embrace social media and blogs. SWOT: Micro economical analysis  Strength 1. Much of Chanelʼs lost brand value can perhaps be explained by the companyʼs reluctance to enter China. In terms of cosmetics market. 2.

7. fragrance. A little research reveals a classic (Reissue 2. high-end prices of products are not reflected on their website and only available upon requests by calls or inshop. The quaint and romantic artisanal fabrication has been replaced by state-of-the-art production methods carried out in modern factories in Compiègne. Product Developments and Collections In the hands of Alain Wertheimer. two Marina Bay Sands boutique in Singapore Chanel exclusive flap with chain and charms costs SGD$6280 and SGD$6980 respectively. Wertheimer has faithfully maintained the opulent image of Chanel despite the trend toward democratizing luxury goods. Pantin and Saint-Chamant.55) Chanel bag varies between SGD$2301 to SGD $3. make up. The company has no plans to launch a second line. Range of merchandise includes fashion apparels and shoes. 6.41 More recently. Nothing must alter the image of Chanel. skincare. Chanel can ensure that no outside manufacturer will omit some small but vital step and jeopardize the quality of the goods.199. Chanel is famous for The Suit. Types and Range of Merchandise In-store The company feels it must remain a myth to ensure its mystique. Chanel offers the classic items in their stores throughout the year whilst introducing new. Jewelry.000. Timeline of Product Development Process For Chanelʼs fashion apparels. . fine jewelry and watches. 8. Fragrance & Beauty and The Black Dress. And because Chanel finds discussion of costs “crude”. Each operation is controlled down to the minutest detail. trendy products with each fashion season. with 6 collections produced by Karl Lagerfeld each year.40 Exclusive and “Ultra Luxe” items like Alligator bag can cost up to $26. its product development process can be tracked to about every 2 months. With its own plants.5. Prices and Seasons Chanel’s product prices reflect the opulent image of Chanel. Chanel has undergone a veritable industrial revolution. The Camellia. accessories.

portfolio. but style remains”. Chanel should leverage on this by opening more stores in these emerging markets. 2007 . carried forward by talented and creative Karl Lagerfeld and an amazing marketing and management team that has proved Chanelʼs ability to attract young consumers since late 90ʼs till today.Market research best practice: 30 visions for the future : a compilation of discussion papers.. & Wimmer.com/culture-lifestyle/goods/style/2008/05/12/How-MuchIs-Chanel-Worth/#ixzz14DAkadeZ . Chanel can consider investing into emerging market by opening more stores abroad and tapping onto new media marketing. Bott. D. 1999. Leymarie. Portfoilo. Collections and Creations. 2007. Invest in the emerging markets. -Journal & Analyst Sources Duttge. Mouncey. Buying Chanel (All of it). Chanel. 2008. open more stores: There is an increase in income for the people living in the emerging markets such as China and India and this leads to more demand for luxury goods. Chanel.Rizzoli International Publications. 1987. G. Prestel. Increase emphasize on new media technology: To remain relevant in a technology-savvy society and particularly to attract younger consumers.. Thames & Hudson. To prepare for an even brighter future ahead. which many competitors have done... 11. case studies and methodologies from ESOMAR . 10. References -Book Sources       Buxbaum. 2. for “ Fashion fades. Recommendations 1. Pay more attention to the counterfeit and possible invest in technology to prevent it: Chanel can possibly work with government boards to clamp down on counterfeit goods at cross-border checkpoints. W. The strength of an established brand started by Coco Chanel.com. Icons of Fashion. 3. Chanelʼs success is truly a result of the houseʼs decision to remain true to Chanel. Chanel can increase new media marketing and consider going into ecommerce.. [Online] Available at: http://www. J. Conclusion Chanel has many strengths that makes it the multi-billion company strongly established within the elusive designer and haute couture market.9. P. inc. always desiring to be a style. F. John Wiley & Sons Ltd.

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