The house of Chanel has recently shared its outlook on its activities and the luxury sector as a whole for the year 2022. Philippe Blondiaux, the financial director of Chanel, predicts that the luxury sector will continue to face challenges and negative impacts for the next 18 to 24 months. This projection takes into account the current external environment, although specific forecasts were not provided.
The year 2019 had ended on a positive note for Chanel, with a revenue increase of 13% (10.96 billion euros). The fashion segment, in particular, experienced exceptional growth, with sales increasing by 28% thanks to the creations of Virginie Viard, the artistic director of the house. However, the pandemic has drastically changed the landscape, leading to a projected decline of 20% to 35% in the luxury sector. Despite the reopening of physical stores and an increase in local purchases, the closure of borders and reduced tourism will continue to have a significant impact in the coming months.
In order to adapt to these challenging circumstances, Chanel is implementing a dual-speed digital strategy. The brand recently showcased its new Cruise collection, titled “Balade en Méditerranée,” in an online format. This move highlights the brand’s willingness to innovate and adapt to the current situation.
However, despite the digital acceleration caused by the crisis, Chanel remains committed to its guiding principles. Blondiaux made it clear that the brand has no intention of selling its fashion, watches, and high jewelry online, regardless of the crisis. This stance sets Chanel apart from other luxury retailers that have embraced e-commerce as a means to reach customers during these challenging times.
Overall, Chanel acknowledges the difficulties that lie ahead for the luxury sector but remains steadfast in its commitment to maintaining its brand image and principles.
Helpful links:
1. Reuters: Chanel Expects Challenging Luxury Sector for 18-24 Months
2. Salon du Luxe Paris 2020
