Pavlovsky rejects any suggestion that Chanel is increasing prices to upgrade its positioning in the market. “We are not trying to be the most expensive. We’re trying to protect the best know-how,” he tells Vogue Business. “We have the ultimate luxury brand, and we want to offer the best product to our customers. When I say the best products, I mean the best materials, the best artisans, etc. We are doing a lot to be able to stay at the highest level.”
He takes the media focus in good spirit. “Most of the competitors have already increased prices much more than what we have done,” he says. “But everyone is talking about Chanel, which means Chanel is the leader.”
The strategy has borne fruit so far: Chanel’s revenues reached $17.2 billion in 2022, up 17 per cent versus 2021 on a comparable basis at constant currency, it reported in May 2023. Operating profit rose 5.8 per cent to $5.8 billion. (The company does not release quarterly updates.)
Renewed confidence in China
Late last year, Chanel warned that 2024 would be more “difficult” because of the slowing global economy and a more sluggish demand for luxury goods. The hope is that sales in China can help keep it on track.
To deepen its connection with Chinese consumers, Chanel showed its cruise collection in Shenzhen last November, its first show in China in four years. The move contrasted with other luxury brands who remain cautious over Chinese market volatility. In February, Dior indefinitely postponed its Hong Kong runway show, initially slated for late March.
Pavlovsky insists Chanel’s investment in China will continue. Next steps include a first retrospective in China of the work of Gabrielle Chanel, to be held at the Shanghai Museum of Contemporary Art in partnership with Palais Galliera (12 July to 24 November).
The exhibition, a variation of which most recently ran at London’s V&A Museum from September 2023 to this March, will display over 200 works. It’s also run in Paris, Melbourne and Tokyo. “Every exhibition [has] a new layout,” says Pavlovksy. “Despite the obvious volatility in the Chinese market, we are so proud to show this exhibition in Shanghai.”
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