What are some of the key lessons and insights that we can take away by looking at the Chanel Marketing strategy? Continue reading for more!
“Fashion changes, but style endures.” – Coco Chanel
Born in 1883 in Saumur, France, Coco Chanel was the fashion designer, founder, and visionary of what later became one of the most iconic and exclusive brands in the world.
A brand that represents a symbol of wealth, elegance, and status, with a value of almost 13.2 billion U.S. dollars according to Statista. A brand that sells purses whose retail value increases every year, making them an actual long-term investment.
Chanel Marketing strategy: getting behind the scenes
In this article, we will take a look at the Chanel Marketing strategy and how the company has evolved over the years to become one of the most emblematic representations of French chic and elegance.
How does their growth and development look from a Marketing perspective? What are some of the key insights that we can take from it? These are just some of the questions that we are going to answer.
But before we dive Chanel’s strategy from a Marketing perspective, let’s take a look at the company’s brief history:
The history of Chanel
The French luxury fashion house was founded in 1910 by Gabrielle Chanel, a fashion designer and a business woman who wanted to cater to women’s taste for elegance as opposed to the over-designed, opulent clothes and accessories of 19th-century fashion.
Gabrielle Chanel, who learned how to sew during her six years living in the French village Aubazine, also sang in a cabaret when she wasn’t working as a seamstress – where she earned her nickname “Coco”.
Later, she became the only fashion designer listed on Time magazine’s list of the 100 most influential people of the 20th century.
History of Chanel & Chanel Marketing strategy. Image source: labellov.com
122 years later, Chanel has established itself as one of the world’s most famous and distinguished luxury brands. It has left numerous legacies – from the jersey fabric to the little black dress, the iconic perfume Chanel No.5 and the ever-increasing in price Chanel bag, the company is a clear example of a successful differentiation strategy.
Today, Chanel serves worldwide across 523 locations, and it is generating a revenue of the mind-blowing $15.6 billion per year.
The legendary address 31 rue Cambon, which has remained devoted to Haute Couture since 1918, has converted the House of Chanel into the oldest active couture house.
Chanel Marketing strategy: 5 Important Lessons
1. Find a sustainable way to differentiate yourself
One of the biggest lessons that we can take from the Chanel Marketing strategy is how a differentiation strategy should be implemented.
Chanel did an excellent job not only finding her competitive advantage and a way to differentiate her brand, but also making it sustainable in the long run – 112 years later, the company is stronger than ever, and her clothes (that were innovative at that time) have become a staple piece in the fashion industry.
Coco Chanel didn’t simply find a clothing brand, it straight up revolutionized fashion. On one hand, the French designer created the first collection that was not only functional and aesthetically pleasing, but also comfortable, at times where structured-silhoutettes (such as corset and bodice) were the norm.
Revolutionizing the fashion industry with iconic pieces such as the Chanel suit. Chanel Marketing strategy.
She introduced clothes that remain unique and iconic to this day, such as the Chanel suit – the first version of which was created back in 1925, being revolutionary for its collarless jacket and amazing tailoring.
Coco Chanel also popularized the black color, invented the famous Little Black Dress, and started using jersey fabric for comfortable clothes – something that was considered her biggest innovation.
By straying away from the trends of her time, she not only managed to differentiate her brand, but also introduced numerous innovations that solidified the company’s reputation and marked the path of fashion for decades to come.
2. Less is more when it comes to positioning a luxury product
Another thing that Coco Chanel did really well, as well as her successors who took over the fashion house after her death, was taking the right Marketing approach for her target audience – and building an exclusive product with some very carefully calculated actions.
One of the best examples to showcase how smartly she did that was the way she created hype for her iconic perfume Chanel No.5. It was the first perfume that she launched back in 1921, a unique fragrance compounded by the French-Russian chemist and perfumer Ernest Beaux.
Chanel No. 5
Chanel marketing strategy – Chanel no. 5.
The initial Chanel marketing strategy that Coco Chanel undertook for the perfume was to generate buzz by hosting a promotional event. She invited a selected group of elite friends to an exclusive dinner in a high-end restaurant in Grasse.
During the dinner, she decided to surprise them by spraying them with Chanel No. 5, and everyone was absolutely delighted, asking more about the perfume.
In addition, during the official launch of the perfume, she infused the shop’s dressing rooms in her boutique with the scent, giving bottles to just a select few, lucky high society friends – the success was immediate, and people felt like they were “winning a lottery ticket”.
In 1974, when the sales of the perfume dropped and Alain Wertheimer, who assumed control of Chanel S.A. noticed that Chanel No. 5 was not selling well, he also used a smart approach to create scarcity and give customers the impression of exclusivity.
He reduced the number of outlets in which Chanel No. 5 was selling from 18,000 to just 12,000 (by 33%), removed the perfume from the drugstore shelves, and invested millions of dollars in ads for Chanel cosmetics. This way, he created the impression that the product was scarce and exclusive, the the sales quickly increased back up.
3. Associate your product with an emotion or experience
When it comes to a good differentiation strategy, and especially in the market of luxury brands, products are no longer equated exclusively to utility. When purchasing luxury products, people are looking for something more than that – an emotion, an experience, a sensation.
And this is what the Chanel Marketing strategy is all about.
Marilyn Monroe and Chanel No. 5: the power of the Chanel Marketing strategy. Image source: getthegloss.com
Coco Chanel wanted Chanel No. 5 to revolutionize the way women smell – she wanted something that would liberate the feminine spirit, something that would have a “mysterious dimension”. In fact, when she asked Ernest Beaux to create the perfume, she told him to “put the scent of a woman in a bottle”.
In the beauty industry, this perfume was an exceptional innovation. At that time, fragrances that women wore fell in 2 categories: “respectable women” and “sexually provocative women”. Coco Chanel was looking to create a new, unique scent that would create a category in the middle.
In this sense, the Chanel Marketing strategy was an absolute success. The perfume gave women a mysterious, peculiar sensation that created an experience other than just smelling well. This idea was even strengthened further when a reporter asked the legendary Marilyn Monroe what she wore to bed.
Her response? “Chanel N°5’, because it’s the truth… and yet, I don’t want to say ‘nude’. But it’s the truth!”
From that moment on, the perfume became the symbol of women that are elegantly sexy, not provocatively sexy. Nothing was sexier than the idea of a woman who goes to bed wearing just a few drops of Chanel No. 5.
4. Leverage the power of Storytelling
Another key element that makes the Chanel Marketing strategy work so well is their use of storytelling to enchant customers and make them want to be a part of the Chanel experience.
Over the last few years, Chanel has been using one powerful weapon to increase their visibility without the risk of overexposure which could undervalue their reputation and exclusivity of the brand: social media.
Currently, they have 51.5 million followers on Instagram (the luxury brand with the highest following), but they are using social media in a very calculated manner, without hard selling and with a lot of storytelling to power the Chanel experience.
Chanel Marketing strategy: combining social media with storytelling
To give you a specific example of their subtle, yet powerful and elegant use of storytelling, let’s take a look at this particular post:
This particular jewelry collection takes us back to Chanel’s legacy with their iconic perfume Chanel No. 5, combining an element that marks the exclusivity of the product: the favorite number of the company’s founder, Gabrielle “Coco” Chanel.
Even without the copy, the image does a lot of storytelling on its own: with the elegant and sensual closeup of the jewel next to the lips of the model, implying what we already learned about in the previous lesson. In other words, how Chanel wanted her products to liberate the feminine spirit.
In addition, the Marketing copy is beautifully written and continues the storytelling, telling us more about the product and what was the inspiration for it, highlighting the legacy that Coco Chanel left for the fashion world.
5. Reach the right target audience the right way
Another thing that makes the Chanel Marketing strategy so successful is the way they are promoting their products to reach the right target audience. Whether you are in the luxury segment or not, you should always seek for the right channels where your target audience is located.
For example, luxury brands with high-ticket products are highly unlikely to have success if they promote themselves on free newspapers handed out at the local metro stations. They have to figure out which are the channels that will bring them the wealthy, affluent people that can afford their products.
In this sense, Chanel is doing it just right – for example, by placing ads on high-end fashion magazines such as Vogue, Elle, Marie Claire, Harper’s Bazaar. In addition, they also use a great Point of Sale Marketing strategy with creative and classy store layouts and mannequins.
Image source: businessinsider.com
And last but not least, let’s not forget that the Chanel Marketing strategy involves a lot of promotion through supermodels, celebrities, and Hollywood actors who become a face of the brand. All of these actions are carefully calculated by the brand to generate a strong positioning in the luxury market.
That was all from us for today! Thank you for taking the time to read our article on the Chanel Marketing strategy, and we hope to see you in the next one!