Chapter 7. Business Marketing

 

  When it comes to business, Chanel is known everywhere for its exclusivity. Chanel is run by the companies shareholder the Wertheimer family whom have been Gabrielle Chanel's early business partner. The company is held together privately differently than other luxury brands like Prada, and Gucci. Chanel never announces their business motives, attend industry conferences, nor do they report their performance figures publicly. Making it impossible for anyone on the outside to know exactly how big Chanel's business really is. As far as business marketing, Chanel is for personal consumption. The company is not a business market, making the brand a consumer market. Being a consumer market the company's buying and purchasing are approached more professionally and in a personal manner. 

 The company had joint ventures with department store where Chanel products are sold. Having these ties there is a level of trust and relationship commitment involved. Chanel shares this with those department stores, Macy's, Saks, Bloomingdales, etc. The company markets to men and women 16-80 that can afford to buy the brand.

 Chanel takes great pride in their customer service as well as goods and services when it comes to business purchasing decisions. Being a consumer market they are very personal when it comes to all aspects buying behavior and their purchasing decisions. They company builds strong relationships with their customers and are more than accommodating  to their needs, personal tailoring being one of them. This is one if the leading factors to why the company is so successful with an estimated $3 billion a year as well as being the leading house of luxury world wide. 

Chapter 8. Segmenting and Targeting Markets

  In 1909 when Chanel started, the company targeted women whom wanted to dress fancier with style and grace. Chanel then started off with hats and modern clothing but also eliminated the corset. The company still targets the same market today of women ages 16-60 but also adding men ages 20-60. Being a luxury brand name, only those more financially endowed tend to pay the price for Chanel since they can afford it. Chanel has a huge selection of different products; haute couture, ready to wear, resort line, men's and children, fragrances, cosmetics etc that cater to its target markets consumer wants and needs. 

  Chanel has over 200 stores world wide with geographic segmentation expanding in the large market in Asia as well as Europe. Chanel retail store and boutiques can be found in busy tourist attractions like New York, Miami, Paris, and Moscow. As far as psychographic segmentation, the company is true to the definition. Chanel targets consumers who's lifestyles can afford the brand, thus  individuals of lower and middle class tend to want the brand more because of its exclusivity, wanting what you can't have in other words. With the use of famous faces and beautiful models the company pulls it's consumers in with advertisements. Helping the house of Chanel to remain the ultimate house of luxury. 

Chapter 11. Developing and Managing Products

 Chanel is a established luxury fashion brand and beauty company, which is well known to the world and the fashion industry. Chanel is most famous for revolutionizing fashion for women and presenting a timeless style of elegance for all ages. Apart from founder Coco Chanel, the company's success in developing products remains on Karl Lagerfeld. Karl Lagerfeld has never failed in giving the consumer's what they desire in a luxury brand. Chanel is able to strike a strong balance between the past and the present which something that eludes many luxury competitors. The House of Chanel works with punky, of-the-moment models like Cara Delevingne while always upholding a timeless, prim and proper image.

  In recent years Chanel has undergone an industrial revolution. The old-fashioned fabrication has been replaced with state of the art production methods carried out in factories in Compiegne, Pantin, and Saint- Chamant. All manufacturers’ procedures are regulated down to the smallest detail. Chanel offers the classic product items in their boutiques throughout the year while, introducing new products with each fashion season. Chanel is most famous for The suit, The Cameilia, The Little Black Dress, jewelry, and fragrance & beauty.  

  For Chanel the development of new products and clothing is all about creativity. The foundation of creativity is the codes of the brand. These codes are iconic because eight times a year, for two haute couture and six ready-to-wear collections , Karl Lagerfeld and his studio to come up with new interpretations. The team of innovators create, collection after collection, inventing the Chanel story again. The company's strong to devotion to fine materials, technology, and to the brand's philosophy have contributed to number of product lines that have excelled. Currently, Chanel is one of the most successful business models founded on creativity. 

Chapter 10. Product Concepts

 When it comes to Chanel there isn't one specific product concept. Chanel sells a variety of different things, also known as a product mix. Those items such as couture, ready to wear, accessories, fragrances and jewelry. It's also known for its product line, for an example their accessories go hand in hand with their ready to wear clothing. Chanel was originally designed to for the comfort of women, so they'd feel comfortable and fashionable in classic tailored style. Chanel has various signature looks in their ready to wear line, such as tweed suits, the very famous quilted two chain bag, and also well known the little black dress. All these designs are still inspiration to designers today, and are often imitated. 

 Chanel has three main clothing lines that are known and often produced. Ready to wear, haute couture, and cruise/vacation. Ready to wear is what you'll find in retail stores, they come in certain sizes and are the finished product. They aren't customized to your body unless needed. Haute couture is customized and tailored fitted clothing. There's always a limited amount due to no two bodies being the same. Haute couture is more expensive then ready to wear since it's limited are the fabrics cost more. Lastly cruise/vacation wear, which basically clothing that's made for the comfort of vacation. But can also be worn just because it's more comfortable. 

 

 Product modification is no stranger to the company, Chanel is constantly reinventing it's self. Chanel spring 2013 introduced "Chanel Rougue Allure Luminous Intense in Envoutante" a deep shimmery mauve lipstick. Chanel Envoutante has a similar deep, beautiful shimmery quality as the Louis Vuitton monogram vernis. Chanel Envoutante, which roughly translates to “spellbinding” is not as deep as Chanel Rouge Noir, but is deeper than Chanel Rivoli. Chanel provides new product items for their make up line, which can be purchased at department store or chanel retail stores. 

 Chanel's product concept is no different from their mission statement and vision, which the company has stayed true to. The products the company till this day is a reflection of Coco Chanel and he vision to being the leading house of luxury. Chanel clothing underlines seduction and sex appeal of a woman. After all "A woman is closest to being naked when she is well dressed." 

Chapter 18. Sales Promotion and Personal Selling

 At Chanel there isn't numerous sales due to the company being such a expensive and exclusive brand. And almost never offers sales to the public. With the Chanel "Ready to Wear" clothing you'll never get a sale with the clothing being tailored to your exact body type. Being that, most of the sales Chanel consume is from customer whom can afford to pay the price. Sometimes prices for last season items are lowered and sometimes they rise due to the exclusivity of it depending on how popular that item may be. The Chanel items that are sold at department stores like Macy's or Saks have promotional sales on cosmetics and skin care. Chanel advertises in department stores with having customers sample new products by testing the makeup and skin care or fragrance with sale reps. They're four types of sale promotion used for cosmetics for Chanel; gift sets, makeup, new product samples, and complimentary shipping.

 Private sales is another type of sales promotion chanel uses. In specific Chanel retail stores private sales take place for a specific collection. For an example, at the 2010 New York City's "Fashion Night Out" for the Mercedes Benz fashion week, Chanel had a grand opening party for the soho location. Chanel gave many guest complimentary samples that night to promote upcoming products. Chanel often gives away complimentary stuff when they have launches for new product and open new retail stores. Usually at opening head of Chanel Karl Langerfeld attends as well as popular celebs, this always brings a buzz and advertises the company more in the media.

 As far as personal selling goes for Chanel, often times people who own chanel products will sell them online at popular sites like eBay and Amazon. The prices online usually skyrocket and most buyers are skeptical of buying products online due to Chanel's counterfeit problem. In terms of follow-up the company is excellent at making sure customer needs are met to the fullest, and every thing they are promised falls through. All the employees are properly trained and never fall on the way to use products. 

Chapter 17. Advertising and Public Relations

   Chanel has a wide range of advertisement that can be found in magazines, billboards, department stores where products can be purchased, and occasionally on television commercials. Their ads are worldwide and in various languages. On Chanel's website you can choose your language to view the site. Chanel spends millions each year on advertising, using various famous models and celebrities. Some famous faces like Brad Pitt for the fragrance Chanel No.5. Head of Chanel, Karl Lagerfeld picks the latest models that are used in today's campaigns and advertisements. Chanel's advertising is very important for their clothing, it helps promotes their ready to wear clothing down to every detail. Chanel has ads for all the products they sell. The company is not aggressive about advertising because its already globally known, so it attracts business all the time.

  
  Chanel is a global leader in the fragrance industry and a top innovator in fragrance advertising and marketing. Chanel continued to spend more on advertising than almost any other perfume company and, as a result, was earning the richest profit margins in the industry. In addition, the company had continued to expand into new product lines, including Chanel watches retailing for as much as $7,000, additions to its popular shoe line, and other high-priced clothes, cosmetics, and accessories. Chanel uses advertising appeal mostly when it comes to cosmetics and skin care line, showing the consumer with buying certain products it will improve their skin or denounce flaws in facial features.

   As far as Public Relations goes, Chanel has a variety of skills. Chanel throws dinner parties for celebrities to enhance its popularity. Chanel also has promotion with companies like Style.com and Vogue.com that advertise Chanel on their site. Chanel also has their own website with an FAQ and also a fashion blog. Chanel also offers exhibitions for media and the public. Chanel has regular merchandise demonstrations for publishing new products that invite media to report. For this Spring-Summer Ready-to-Wear collection, presented Tuesday, October 1st 2013, Karl Lagerfeld transformed the Grand Palais into an art gallery. An invitation to a vernissage of around 75 installations.

Chapter 15: Retailing

I recently visited one of the three Chanel New York locations for chapter 15. The store I chose was on W 57th street. This store seemed to be one of the smaller Chanel retail stores. The other two store are located in Soho and East 57th street. This store  was well put together and color coordinated as classic Chanel should be. Neighboring Chanel was Prada, Louis Vitton, and the famous fifth avenue Tiffany & Co that was featured in the classic "Breakfast at Tiffany's". 

Inside of the store are oak wood floors, black granite with glass display cabinets, holding Chanel's seasonal jewelry and watches. Across from that are shelves filled with the latest Chanel handbags, including the world known quilted handbag. Torwards the back are maniquins in Chanel's ready to wear clothing. They're are a limited amount if clothing in the store, so if you can find your size there's a big chance you can't get the item unless you order it and possibly meet with a tailor. Chanel clothing isn't sold online. The employees were dressed in business professional attire, white button ups black slacks and black blazer. Unfortunately pictures weren't allowed in the stores so I took one of the outside.

Chanel is a franchise with over 200 stores worldwide. Chanel products can be purchased at select department stores, including Bloomingdales, Saks, Nieman Marcus, etc. Chanel on W 57th is a destination store due to its location it attracts a lot of tourist and high end clients. The atmosphere of Chanel is very upscale and luxurious being surrounded by other high end upscale stores. Chanel also comes off as a retailing mix, you can purchase many different Chanel items at the store. Further more Chanel's fragrances and cosmetics can be purchased online or in department stores that are lucky enough to carry them.