The price increase of head luxury brands during the economic downturn is more important to consolidate brand value. This article comes from the WeChat public account: Interface News (ID: wowjiemian) , Reporter: Huang Shan, original title: “Luxury Brands Increase Price Against the Trend: LV Increases Twice in Two Months, Chanel Will Increase Prices in China”, Photo Source: IC photo
The spread of the New Crown epidemic has hit the fashion retail industry tremendously, but it has not stopped the pace of global price increases for multiple head luxury goods.
Interface fashion sees that many fashion bloggers and luxury purchasers have expressed since May, including Louis Vuitton (hereinafter referred to as LV) A number of luxury brands including Chanel will set off a new round of price increases in May.
According to relevant rumors, the French luxury brand Chanel China team has confirmed this wave of price increase plans to Interface Fashion, and said, “We will continue to follow the global price coordination strategy for this price adjustment to avoid significant price differences between markets . “
As of May 11, Chanel seems to be the first to start price increase in the European market. A European fashion website Pursebop recently wrote that in the past weekend, parts of Chanel’s European stores include new price tags. Li Zimu, a global luxury goods purchaser with 360,000 followers on Weibo, also confirmed the news to Interface Fashion.
Taking Chanel’s classic handbag “Chanel 2.55” as an example, Pursebop wrote in the article that a medium-sized black metal chain leather handbag of this series has been5150 euros rose to 6050 euros, an increase of 17.4%.
Medium black leather “Chanel 2.55” handbag price before the price increase is 5150 euros.
Medium black leather “Chanel 2.55” handbag is 6050 Euros after price increase.
At present, the price increase time of Chanel in the Chinese market has not been determined.
Interface Fashion contacted Chanel China Customer Service Center on the morning of the 11th to learn that the medium-sized “Chanel 2.55” black metal handbag did not raise its price in the Chinese market, and the price was about 47,000 yuan. The sales interface of a Chanel store located in a prosperous area in Shanghai said that this handbag “has not yet been raised in price.”
Purchasing Li Zimu told Interface Fashion that if the Chinese market raises prices, according to the increase in the European market, the price of this handbag may exceed 50,000 yuan.
A number of luxury goods purchasers told the interface fashion reporter that after this round of price increases, many of Chanel ’s bags have “prices approaching Hermes.”
French luxury brand LV is the leader of this round of price increases, the brand has been in the country on May 5The counters and official website within the company have unified price adjustments for products. At the same time, LV has also raised prices in the US, Canada and Australia.
LV Cannes handbags. Image source: Louis Vuitton official website
This is LV’s third price increase in nearly a year. The first two price increases were in September 2019 and March 4, 2020. It is worth noting that the interval between the last two price increases of LV is only 2 months, both after the outbreak of the new crown epidemic.
This time the price increase of LV’s many classic luggage has made a price increase between 5% and 9%. Take the LV classic “bucket bag” CANNES handbags as an example, the price of the Chinese counter increased from 17,900 to 19,400 yuan, an increase of about 8%.
Interface fashion reporters learned from several luxury goods purchasing offices that Gucci, Dior and Valextra are also rumored to increase prices. In this regard, Gucci China told the interface fashion that it has not received news of price increases.
And a Dior customer service told the interface fashion on the phone that he did not receive news of the price increase of all products. Since May 1, only one mini “Dior Book Tote” has been adjusted, from 16,000 yuan to 17,500 yuan.
Considering the huge negative impact of the new crown pneumonia epidemic on fashion and luxury brand retailers, it seems that some head luxury brands have raised their prices against the trend, which is a bit confusing.
Some netizens have really commented on the price increase of LV in Xiaohongshu.
But in fact, luxury goods have their own logic to rise against the trend during the economic downturn.
Since the 2008 financial crisis, the successive price increases of head luxury goods have become a common phenomenon in the past more than ten years, so that people who have been in the luxury industry for a long time are used to it. Hu Mengmeng, who is engaged in the luxury goods purchasing business in Hong Kong, told Interface Fashion that “price increases are normal.”
The price increases of these luxury goods are partly attributed to the objective increase in the production cost of luxury goods, which involves the increase in raw material prices, transportation and labor costs, and exchange rate fluctuations.
This year, the global spread of the new crown epidemic has caused global trade logistics to be blocked on a large scale, and the production of textile manufacturers in many parts of the world has been shut down, which has caused the production cost of luxury goods to rise. As Chanel China explained to interface fashion, “Under the current circumstances, the prices of some of the raw materials we need have risen again, and these raw materials have been difficult to purchase due to their high quality.”
Because of the new crown epidemic, these head luxury brands were forced to close European factories, which will inevitably lead to a decline in production in the second and third quarters of this year, resulting in a period of mismatch between supply and demand, which will further push up. Product unit price.
Hu Mengmeng told the interface fashion, “Luxury prices increase, increase unit price, reduce quantity, the quantity affected will definitely have a little less impact than higher unit price in their assessment.”
Photo source: IC photo