MILAN – French luxury group Chanel has increased prices on some of its products again after three hikes in 2021, making some of its signature handbags up to twice as expensive as they were in 2019, before the pandemic.
Big luxury brands have been raising prices throughout the coronavirus emergency to protect profits and, more recently, to combat rising costs of transportation, logistics and raw materials.
But Chanel has been more aggressive than its rivals, a move analysts say is also aimed at making the brand more exclusivist.
The Chanel small classic handbag was selling for 7,750 euros (S$11,500) on the Chanel France website as of Friday (March 4), 6% higher than in November last year. The same bag was sold for 5,500 euros in January 2021 and 4,550 euros in November 2019.
Chanel has increased prices on its iconic handbags by an average of 71% since before the pandemic, according to analysts at Jefferies. In Hong Kong, prices for the small, classic handbag are now up 96% compared to the end of 2019.
“What we implemented yesterday is not a price increase, but rather the standardization of the prices of all products offered in our stores. This is a principle we have applied since 2015 and aims to avoid excessive price differences between the markets in which we are active,” Chanel said in a statement.
A spokesman confirmed that prices of the company’s core products – handbags, accessories and seasonal ready-to-wear clothing – rose 6 percent in the euro zone, 5 percent in Britain, 5 percent in South Korea, 8 percent in Japan and 2 percent in Hong Kong on Thursday. Prices remained unchanged in China and the United States.
Jefferies said the price gap between China (where prices remained unchanged) and Europe for Chanel handbags had narrowed to less than 10 percent after Thursday’s price increases, compared with 30-40 percent for most luxury brands.
