Ch. 11 - Developing and Managing Products

Chanel has traditionally focused its efforts on designing, developing and producing products for the market. Today, global competition, outsourcing and legislation commend that companies take greater responsibility of their products. In the luxury brands industry, consistency is extremely important, in order to generate profit by creating brand value and customer value. A company needs to draw on the history and tradition of its own brand, which arc the foundation of product-making and resulting techniques, and showcase the philosophy of its own brand. Unless this is done in a consistent manner, the company cannot retain customers for long. The goal when developing a brand is to create value. Chanel do that by emulating the characteristics and values that its customers desire. Branding is present throughout everything Chanel's company touches—it is not just a logo.

 Nobody in marketing needs to be told about the importance of product consistency. Consistency is all, and while this bit of branding wisdom applies most commonly to products, savvier companies have extended it to retail design, customer service and, to advertising imagery. In 1922 Chanel introduced a perfume, Chanel No. 5, which quickly became popular, and remains a profitable product of the Chanel organization. Now in its 90th year of production, Chanel No. 5 is the best-selling fragrance of all time, and one with a long trail of print ads behind it. But whether the ad comes from 1968, there's a good chance you'll encounter the same stylistic elements therein, to wit: the bottle. Sure, beautiful models have come and gone, but the signature modernist flacon is the centerpiece. And that's no accident. "Chanel has always kept a certain kind of minimalized brand identity," noted Tilar Mazzeo, author of The Secret of Chanel No. 5. "It's all about the form and the line of the bottle."

"Chanel is clearly at that point where everyone is highly focused and is working together in a way that has created a terrific business," said Arie Kopelman, president and chief operating officer of Chanel Inc. The foundation of creativity is the codes of the brand. 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. The last several seasons have produced innovative items such as frayed tweeds, sleek sport looks, quilted bags in bright colors and unconventional shapes, as well as candy-colored costume jewelry.