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Establishment of a Chanel outlet in Japan

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The company Chanel was founded in 1910 by Gabrielle Chanel. In 1950, the company was bought by a Swiss family: Wertheimer. Under their ownership, the brand grew and became internationally renowned, especially due to the success of its famous tweed suits, its perfume, "Chanel No. 5" and its iconic bag "2.55". In 1971, Gabrielle Chanel died and Karl Lagerfeld succeeded as Artistic Director, setting the stage for the gradual reincarnation of Chanel began.

Karl Lagerfeld would introduce a new style, combining traditional elegance and modern Parisian trends, a style that the crowds like as much as the celebrities. The main reasons for the success of Chanel are the responsiveness and innovation that the brand has demonstrated through the years. The company was able to adapt to the explosion of the luxury market. After cosmetics, it launched jewelry, leather goods, ready-to-wear and watches.

The only published accounts of Chanel SA since 1994 can attest to the undeniable success of the brand. The company recorded a turnover of 3.7 billion francs for France that year, and generated 8 to 9,000,000,000 francs in sales per year globally. If Chanel was able to perform on such a scale in the world of luxury, why did it not continue this momentum by diversifying in other segments, including creating a restaurant in its own name? The Restoration of Chanel in Japan: It is likely that this initiative will be a resounding success, as the current trend in Japan tends to a search for hedonistic pleasures.

This leads me to ask several questions: What could the positive or negative effects of such an approach on the brand be? How may the brand establish itself as conservator, along with other luxury brands? How can we integrate the image of the brand within this concept as closely as possible? How can we make a restaurant that is identified as Chanel? These are some of the questions that will be answered in the following report.

Trends of the luxury market in Japan: The presence of France in the luxury market in Japan is much better than compared to the technology sectors. For example, with respect to the leather products, France is the second largest supplier to Japan with 20.6% market share, behind China (45.2%). From the top five imported luxury brands in Japan, there are three French brands (Louis Vuitton, Hermes and Chanel) totaling 17.4% (226 billion yen) of the total imports (1300 billion yen).

In Japan, the luxury market is a market paradox.
The luxury sector activity of Japan fell 0.6% in 2002 and the same year, Chanel experienced sales growth of 30% in 2001 and 18% (700 million) in 2002. In reality, the crisis in Japan in recent years is an advantage for foreign companies selling luxury goods, since it seems that this crisis does not affect the consumption of the Japanese on this type of product, but it allows businesses to locate at a lower cost.

In addition, strong presence of French brands in the Japanese market is crucial, since Japan is the second largest market behind the U.S. for jewelry or accessories and it represents 18% of the world market for luxury items.

Tags: Chanel, leather goods, cosmetics, luxury market, China, French brands Japanese market

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