Chanel's exclusivity keeps it a cut above

Chanel President: Brand value is key
Chanel President: Brand value is key

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Chanel President: Brand value is key 04:53

Story highlights

  • Founded by Garbrielle "Coco" Chanel in 1909, today the French fashion house is a global brand
  • Luxury good brands are looking to take advantage of an expanding middle class in China
  • But Chanel has kept its footprint in Shanghai, one of the world's most populous cities, light
  • It has opened just three boutiques to keep brand exclusivity

Shanghai may be a target for many luxury brands but Chanel, famous for its simple and elegant designs, is keeping its footprint on the city light.

Founded by Garbrielle "Coco" Chanel in 1909, the fashion house redefined outfits for women with its timeless outfits.

Today the French label house is recognized as a pioneer of tailored and ready-to-wear collections.

But it has been careful not to overwhelm markets, choosing instead to focus on brand exclusivity.

Chanel's president of fashion, Bruno Pavlovsky, said such exclusivity is the best way to ensure customers keep coming back for more.

Chanel has opened just three boutiques in Shanghai -- one of the world's most populous cities. Pavlovsky told CNN: "We try to get the best three boutiques in Shanghai instead of having 10 boutiques."

That, he said, is the "number one" priority. "We try to bring through the boutiques the best value of the brand... our idea is not to open lots of boutiques but be able to give, through the existing one, the best value and the best service to our customers."

China -- with a population of approximately 1.3 billion people -- is a focus for luxury brands due to its expanding middle classes. Its growth comes as consumer spending in Europe and the U.S. dwindles.

Pavlovsky said customers in China are "experts of the fashion world, they know everything, every detail and at the end of the day what they want is the same product that we are selling here in Paris or London."

The company remains privately held and Pavlovsky says the absence of shareholders eases the pressure on Chanel.

"It gives us the possibility to put more focus on the company 20 years from now... and even increase the attractiveness to our consumers," he said.

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