Do You Fear for the Future of Chanel?

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the downturn's coming for everyone but Chanel's big enough to weather it, I think. Especially if MB establishes a point of view and sharpens up the clothing offerings a bit.

but his show wont take effect till end of the year basically

 

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They can stick it out until then, one bad year isn't going to put them out of business.

 

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just for future context /info some interesting Facts/notes on past Chanel

Arie Kopelman, Former President of Chanel, Dies at 86​

Kopelman led Chanel through a massive period of growth, and was known for his sense of humor.
WWD

OCTOBER 8, 2024, ​

In 1985, the owners of Chanel, Alain Wertheimer and Gerard Wertheimer, hired Kopelman as Chanel Inc.’s president and chief operating officer at their New York headquarters. The way Kopelman told it, Wertheimer insisted he had no other choice when he hired Kopelman. He said [Alain] Wertheimer told him, “I will never find someone whose wife’s name is Coco and whose first language is French. Come and run my company.”
Kopelman was hired to manage both Chanel and Frederic Fekkai Beaute in the U.S. on Jan. 6, 1986.
Over the next 19 years, Kopelman expanded the company’s retail, fragrance, cosmetics, skin care, eyewear and accessories businesses, growing it into a multibillion-dollar enterprise.
When Kopelman got to Chanel, the brand had two freestanding boutiques and an annual revenue of a reported $357 million.

By the time he retired as president and chief operating officer in 2004, there were 17 brick-and-mortar stores in the U.S., and by 2014, the brand was doing $7 billion in sales.

Facing increased competition from European luxury brands, Kopelman told WWD in 2000 that his plan was to remodel the stores (the company rolled out a sleek new retail format designed by Peter Marino) and corners across America, increase the ad spend, reach out to new customers with “irresistible” lower-priced goods and leverage the brand’s skin care collection. “The Chanel name means a lot — it’s a standard of luxury — but we want to make it even more relevant today,” Kopelman said.

He said that Chanel had been quite a different place when he joined the company in 1985.
At that time, the firm was just beginning to open its own stores and Karl Lagerfeld had been designing the ready-to-wear collection for only a few years.
The mindset among many of the long-term Chanel employees he encountered was that the house’s fashion was on a pedestal and shouldn’t be advertised at all, or not in the same way that fragrance was promoted.
Kopelman was credited with forging strong relationships with retailers and magazine publishers and keeping Chanel in high standing as one of the world’s great brand names, protecting its sophisticated appeal and broadening the product range, with categories such as jewelry and watches, all without taking its products on a promotional path, even in difficult times.
He was also credited with leading a careful retail expansion in the U.S. and being very selective and patient in choosing the right locations for new stores.

In an interview when he stepped down, Kopelman recalled Chanel’s expansion in the U.S., at the time with 16 of its own stores and eight fine jewelry boutiques and more than 90 retail accounts; the introduction of the fragrance Coco Mademoiselle, and the 20-month-long negotiation to lure Nicole Kidman as the new face of Chanel No.5 for a Baz Luhrmann-directed commercial.
Jean Hoehn Zimmerman, former executive vice president, beauty and fragrance at Chanel U.S., said, “Arie was my boss, mentor and guru for over 20 amazing years at Chanel. We worked so closely and were always on the same page about what was needed to be done for the U.S. company. He was a doer and a facilitator for his team, as well as a visionary. He made so many important inroads, not just for the business of beauty and fashion, but also for employees internally. He was loved and respected by everyone he came in contact with. I will miss him tremendously.”


“The interesting thing for me was that I felt I could play a role in taking Karl’s raw talent and helping market the product,” he told WWD in 2004, pulling from his war chest a Kopelman-trademarked proverbial business practice:

“If you have the right product, you can have a very good business, but if you have the right product backed by the right marketing, you can have a great business,” said Kopelman.

 

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us.fashionnetwork.com​

Chanel billionaire owners set to forgo payout amid luxury slump​

The billionaire Wertheimer family behind Chanel may forgo a payout from the luxury brand’s most recent earnings cycle in a sign the industry downturn is hitting another of the world’s wealthiest dynasties.

London-based Chanel didn’t pay an interim or propose a final dividend for 2024 earnings, according to a filing. That’s the first time since the 2020 pandemic year that the maker of expensive clothes and leather goods hasn’t earmarked a windfall for the clan’s Cayman Islands-based holding company. Chanel reported a 30% drop in profit amid heavy spending on marketing and property, and weak sales in China.

Any dividend paid in 2025 will be decided by the board in the coming months, said a spokesperson for Chanel.
The latest lean year comes after a lucrative run for the Wertheimers, who pocketed $12.4 billion over the previous three years when consumers splashed out on Chanel perfume, quilted flap bags and variants on the label’s signature tweed suits. The payouts helped propel the combined fortune of the media-shy owners and brothers Alain, 76, and Gerard, 74, to $85 billion, according to the Bloomberg Billionaires Index.

The Wertheimers are among a group of ultra-rich French citizens whose luxury goods and cosmetics empires fed their fortunes during the post-pandemic shopping boom but have since seen their wealth deflate.

They include LVMH founder Bernard Arnault, who is now world’s eighth-richest person with $156 billion after a stint at the top of Bloomberg’s wealth index. L’Oreal SA heiress Francoise Bettencourt Meyers has also dropped back to become the second-wealthiest woman after an extended perch at the top. Francois Pinault, the octogenarian founder of struggling Gucci-owner Kering SA, has seen his wealth drop by more than two-thirds since a peak in August 2021.

The absence of a shareholder payout for 2024 at Chanel coincides with a steep 43% increase in capital expenditures to around $1.8 billion, partly to buy upscale real estate. Recent purchases include buildings on Paris’ swanky Avenue Montaigne and on Rue Cambon, where the creator of the label, Gabrielle “Coco” Chanel, opened a hat boutique in 1910. The Wertheimer brothers are credited with owning equal shares in the closely held company, which they inherited as grandsons of one of the original business partners in her perfume operation.

Alain Wertheimer is Chanel’s global executive chairman and is on the board, while Gerard isn’t listed as a director. The Wertheimers’ family office, New York-based Mousse Partners, is headed by half-brother Charles Heilbronn and has been using proceeds to invest widely including buying a stake in fashion label The Row.

Chanel began publishing results seven years ago following a group reorganization that turned it into a holding company for the brand.

 

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fashionnetwork.com​

Chanel’s Bruno Pavlovsky on the arrival of Matthieu Blazy, Trump tariffs and business being better than ever​

This Tuesday, the Parisian marque kicked off the European cruise season with a smart show staged on Lake Como at the mythical Villa d’Este hotel. No designer took a bow, but the lakeside show was crammed with jewel-bedecked VICs flown in from over a score of countries - testifying to Chanel’s near intoxicating power with the world’s wealthiest one percent. An ode to movie-star chic and Italian glamour, whose muse as the great Austrian actress Romy Schneider, a great friend of Coco Chanel.

The show comes after quite a few months of criticism on social and established media of Chanel’s prices increases last year, in the midst of difficult global economy and a major downtown in luxury sales.
It’s a point of view that Pavlovsky vehemently rejects, pointing to the sheer quality of all Chanel products, and the savoir faire, workmanship and technology involved in making top-level prestige goods. While in Como, Chanel ferried scores of editors to discover key Italian producers with whom the brand works, like Mantero, the brilliant silk producer and printer.

Hence, pre-show FashionNetwork.com sat down with Pavlovsky, to hear the latest from the man charged with overseeing this vital new step in the 120-year-old brand, and shining symbol of French flair and chic.

Fashion Network: Why did Chanel come to show in Como?
Bruno Pavlovsky: It’s a mythical location that works extremely well for Chanel. It’s a place where so many films have been shot, ideal for the theme of this collection. Last week, they were shooting a feature in the villa! And half of Coco Chanel’s heart was in Italy, another reason this location is perfect.

Access to Villa d’Este is actually very hard. We needed two years to organize as we booked the whole villa for four days. But quite frankly, its terrace is inspiring to anyone who is a designer.

FN: Why are cruise collections so important for Chanel?
BP: Coco was the first to do a cruise capsule for Americans leaving for cruises in the Caribbean in the '20s. Karl was the first to stage a cruise show. Cruise is an exceptional moment where a brand is fully able to express itself and be inspired by a certain location. And, the delay of the collection – it enters in boutique in November and lasts to May and is lighter and more colorful and that adds energy to our boutiques. That’s another magical moment.

Chanel cruise 2025 show in Lake Como - Courtesy

FN: Not every brand continues to stage shows, especially cruise, especially between creative directors. Why was it important for Chanel to keep staging shows in the interim?
BP: It’s because Chanel the brand is stronger than any designer. When Karl or Virginie Viard were our designers, we never skipped a collection. Because that’s who we are. It’s not just about showing to the press, but also our relationship with our clients. I can tell you we have never sold as much ready-to-wear as we do today The client is of course influenced by who is the designer and their ideas and energy, but they buy because of the product.

We do these shows to make people dream. Certain clients, I believe, don’t even know who exactly is our designer. But they know Chanel and have certain strong feelings about what Chanel is. And we need to preserve that. That’s why we are very content to see Matthieu arrive - with his eye, his talent and his experience together with the experience of our studio.

FN: Explain why Chanel made recent investments in Italian suppliers, like Mantero where you just bought a 35% stake?
BP: One of reasons for coming to Como is that it helps us show off our ecosystem. Like Mantero for silk. It demonstrates the reality of work behind the product – the savior faire, the hands and the machines. Luxury only exists thanks to that today. Without this expertise that exists for decades, Chanel could not incarnate luxury as it does today. Forming a new generation of artisans is essential. Plus, these visits to factories gives editors a chance to understand why our products are so expensive – you see the technology and skill and time required. It’s a virtuous circle.

FN: And why specifically did you acquire 35% of Mantero?
BP: We have worked with Mantero every single year for over a half century, together developing exceptional products. Today, the situation is such that neither Lucia nor Franco Mantero have heirs.

Chanel cruise 2025 show in Lake Como - Copyright: Chanel

So, the question had to be asked what will happen with one of the most beautiful Italian manufactures, if tomorrow morning there is accident? That’s why we want to be present and help. This is not about control. To create Mantero’s exceptional silk, the investment needed is very high. So, we can help with that to guarantee Mantero makes the best prints, using less electricity and polluting less, while still making money.

We work with 67 different suppliers and plants and each brand and family has a certain rapport. Many work independently of Chanel with other luxury brands and that’s good.

FN: There has been a certain amount of negative reaction, especially on social media, to top level luxury brands increasing prices. Do you think that is unfair?
BP: Those complaints last year do take into account this ecosystem of hyper-quality required to make our Chanel products. We also need to guarantee this ecosystem exists in the future which requires substantial investment and explains why prices sometimes have to be raised.

FN: What are your plans for dealing with Trump tariffs in the U.S.?
BP: Tariffs already exist. For ready-to-wear it’s already 15%. There is not free exchange in the world. What matters to Chanel is the client and harmonization of prices. It’s very hard to predict the final position of tariffs, but the harmonization of prices will continue. And don’t forget, right now the dollar has greatly weakened, so prices will go up thanks to the dollar falling.