Tony Nyumba Apindi

 Business Consultancy Report Tony Nyumba Apindi 16/12/2020 Executive Summary Chanel is a global fashion business that operates in the United Kingdom and all over the world. Its headquarters are in Paris, France. It offers in-store and online shopping. It can be contacted by phone, on its social media sites and through its website (Appendix 1). The business offers high-end fashion products from designer clothes to make-up, skincare products, jewellery and shoes to its customers. The target market is mainly the wealthy, ready to spend women in society. This report aims to provide easier and cheaper alternatives for marketing that can be utilized by the fashion house to maximize revenues and reduce costs within the next 1-2 years. The company is privately owned and focuses on a smaller target market to get maximum returns. They can do this since they cater to all the needs of their clients making them successful over the years. Business Consultancy Report In the business world, marketing a brand assists a business to stay afloat since they continually remind their customers of their products and how they can access them. It maintains sales and hence the growth of the business. Chanel is a global fashion brand from France and has grown to operate worldwide mainly focusing on women's fashion. Since its inception in 1910, the company has taken different strategies to make sure it remains relevant and viable in its preferred market since it offers quality goods. This report focuses on the marketing strategy that Chanel should incorporate to allow it to remain viable in the market. Figure 1: The Chanel Logo Marketing Strategy Direct to Consumer Approach Within recent decades, technological improvements have helped in shaping today's world making it very easy for people to communicate and work in different regions all over the world. As such, many start-ups have benefitted from it and marketed their goods on social media platforms and on websites that they have created. In so doing, they have managed to reduce expenses and removed the middleman which assists them to sell directly to their customers and earn more revenue. Growing the Community In acquiring new customers, using social media platforms such as Facebook, Twitter and Instagram assist the company to gain new and remind their already existing customers of their products. Building savvy social media accounts attract and allow the brand to make a community (Biondi, 2019) around it. The move helps in building an emotional relationship that essentially becomes difficult to break. The company can respond to the needs and get feedback directly from their clients. Figure 2: The Instagram cover page for Chanel. But with the increasing saturation of the platforms, it requires the companies to be innovative in relating to their clients. Some of the moves include showing their clients the production methods and liaising with celebrities in marketing (Rantanen, 2017) their brands into the wider market. It engages existing customers and those who cannot yet afford their products with the brand. The in-store experience also allows customers to engage with clients directly. It also allows for the marketing of goods without any costs. Word of Mouth In this method, the company can focus on making the brand easily accessible. For this purpose, they make the clients able to buy into the brand and not specifically what a particular celebrity is wearing only. It ensures continuity of sales even if the celebrity is not part of the brand. This move is achieved by incorporating the brand to the sellers at the store and allowing customers to get more information about the brands that they are buying within the stores across the United Kingdom. The company can also use attractive advertisement campaigns that will make their market to need to know more about the brand, hence they will enquire from people they know and get references to where they can get the brand products. Reducing Wholesale When using wholesalers, they often make their profit by taking a percentage from the proceeds of the business. They use a standard rate which makes it difficult to gain profits (Ratajczak-Mrozel, 2017) when there is reduced economic activity. Such a scenario will lead to losses for the business. Impact of Brexit Since Chanel conducts its production in France and Italy, in collaboration with the best craftsmen to produce its goods, their goods reaching the United Kingdom are imported. The final scenario caused by Brexit makes it hard for the business to maintain a constant supply chain due to the uncertainties the decision offers. The European Union offers subsidized costs of operations within its jurisdiction and existing it will increase the cost of operations. If the break happens, it will not cost the company a lot of money since they had already scaled down their operational costs. The move will also enable them to maintain their customers due to the slight increment of prices of the imported goods due to direct to consumer approach. Impact of the Coronavirus With the spread of the covid-19 virus all over the world, the country has been one of the worst affected. In a move to reduce the spread, the government has imposed measures to reduce contact and minimize social gatherings (Nhs, 2020). It essentially means fewer people within the shops of Chanel. With the use of their online platforms and websites, the company can still send deliver their products easily and reduce the risk of infection which assists it to maintain its sales. Figure 3: Social distancing outside a Chanel Shop in London. Competitors Within the United Kingdom, the main competitors for Chanel include L'Oreal, Gucci, Burberry and Harry Winston. The customer would prefer Chanel due to the high quality of the goods that they offer made by the best craftsmen in Europe only. As such, it has a high price tag on its goods and mainly competed by Gucci which also offers the same kind of products. The advantage it has over other brands is it concentrates on a smaller niche, women’s clothing making it very popular among the wealthy young women. The other brands allow Chanel to have a wider market, especially for loyal customers since they offer an array of luxury goods from clothes, jewellery and cosmetics all under a single brand. L'Oreal concentrates on cosmetics, Harry Winston on jewellery while Burberry on clothes. Figure 4: An array of products offered by Chanel. Consumer Profile Chanel targets its consumers mainly through the lifestyle that they live. The main target includes wealthy women between the ages of 20-80 years that can purchase its products (Wilkins, 2016). The consumer should be of high disposable income. The pricing of their bags and clothes are high. For their beauty and fragrance, their prices are considerably lower than their bags and clothes since they can be obtained in the average departmental stores (Wilkins, 2016) across the United Kingdom. The consumers will spend the money to buy them due to their relations with the brand name hence fuelling more sales. Figure 5: Chanel No.5 perfume. The 4 P’s Chanel Product Strategy The products are for an elite audience that can buy high-end luxury products. The products include skincare, fragrances, makeup, watches, jewellery, Haute Couture Fashion etc. The products are of high quality and imported to the United Kingdom from renowned designers and made from high-quality materials. Figure 6: Image: Pixabay Pricing Strategy Since the business caters for high-end customers, the prices for the products produced have always been for the high-end society, people who are ready to spend and get the finer things in life. Thus, its niche is the cash-rich customer. The raw materials used are rare, the final products are of world-class quality, the targeted customer is rich and ready to spend and the Chanel brand is sought after that the clients are willing to pay any amount for it. Place and Distribution Their stores are located in high-end localities that are only accessible to the high-end society. Since its potential customers have a lot of money, their stores are also located in airports and lobbies of five-star hotels. Promotion and Advertising The marketing should be done by known celebrities wearing their brands, point of sale marketing by using classy store layouts and mannequins (Butigan and Grilec, 2013). Using the high-end blog spots, social media and renowned websites. Figure 7: Who What Wear: Cardy B holding a Chanel bag Conclusion Reaching a larger newer market and the existing market has been made easy with the use of the online portals and the direct meetings of the clients and the business. It enhances the relationship between the two parties. In the current shift of online platforms, it is advisable to use the direct to customer approach due to its effectiveness in marketing and obtaining more customers and also new ones. It is also cheaper compared to the other methods that are in place. Over the space of one to two years, it is advantageous to use the method and it makes it easier through improvements like 5G (Newman, 2019) that allows easier and faster connections. References Biondi, A. (2019). The direct-to-consumer opportunity for British fashion. Vogue Business. Butigan, R., Grilec Kaurić, A., & Ujević, D. (2013). Specifics of marketing strategy in the segment of high fashion. International journal of multidisciplinarity in business and science, 1(1), 19-27. Newman, D. (2019, March 6). Five Advancements 5G Will Enable In The Future. Forbes. Nhs. (2020, January 24). Coronavirus (COVID-19). Nhs. Uk. Rantanen, J. (2017). Celebrity Endorsement in Social Media Marketing. Ratajczak-Mrozel, M. (2017). (PDF) Positive and negative effects of a company’s relationships in the internationalization process. ResearchGate. Wilkins, S. (2016, November 21). Brand Report: Chanel. Issuu. Index https://www.voguebusiness.com/companies/british-direct-to-consumer-brands-fashion-bfc https://www.forbes.com/sites/danielnewman/2019/03/06/5-advancements-5g-will-enable-in-the future/ https://www.nhs.uk/conditions/coronavirus-covid-19/ https://www.researchgate.net/publication/-_Positive_and_negative_effects_of_a_company https://issuu.com/sarahwilkins47/docs/chanel_report Appendix Appendix 1 Phone Numbers for Chanel United Kingdom - - - Website for Chanel United Kingdom https://services.chanel.com/en_GB/storelocator/store/chanel+selfridges+london++ready-to-wear-32050.html?y_source=1_MTQ5MzA4NTAtNzE1LWxvY2F0aW9uLndlYnNpdGU%3D Social Media Instagram: https://www.instagram.com/chanelofficial/ Twitter: https://twitter.com/CHANEL?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Eauthor Facebook: https://www.facebook.com/chanel/