The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
The French luxury house has upped prices for some of its most iconic bag models by 10 to 15 percent in its third round of price adjustments since the pandemic began.
The price increases, which took effect on July 1, boosted price tags on models like Chanel’s Classic Maxi Flap by 15 percent.
Rumours of a price hike saw shoppers in Seoul, Korea, queue up outside Chanel’s boutique in Lotte Department Store earlier this week.
For decades, luxury prices have risen at over twice the rate of inflation and brands typically raise prices once or twice per year in accordance with factors like raw material and labour costs. Harmonising prices across markets — luxury price tags were, for years, significantly higher in key Asian markets like China and Japan — has also been cited as a motive to capture repatriated tourist spending. But in the wake of Covid-19, boosting prices is also helping top luxury players make up for revenues lost during lockdowns and as a result of travel restrictions.
“In line with the commitments made in terms of price harmonisation, these adjustments are made in such a way as to ensure that there are no excessive price differences between the different markets where the brand is present [or] available,” Chanel wrote in an email.
This week, Prada and Miu Miu reported strong sales as LVMH slowed and Kering retreated sharply. In fashion’s so-called “quiet luxury” moment, consumers may care less about whether products have logos and more about what those logos stand for.
The luxury goods maker is seeking pricing harmonisation across the globe, and adjusts prices in different markets to ensure that the company is”fair to all [its] clients everywhere,” CEO Leena Nair said.
Hermes saw Chinese buyers snap up its luxury products as the Kelly bag maker showed its resilience amid a broader slowdown in demand for the sector.
The group’s flagship Prada brand grew more slowly but remained resilient in the face of a sector-wide slowdown, with retail sales up 7 percent.