Luxury Brand Big Price Cuts Forced To Purchase No Way Out!

Chanel has issued a statement recently, which has raised its total price by 20% in the European market since April 8th.

The price of such products is reduced by 20% to balance the global price system.

But before April, yesterday, Chanel counters and boutiques in major Chinese cities began to cut prices.

How much is the price adjustment? Classic handbag diving 20.5%

The price cuts will begin in April 8th, including handbags, leather goods and clothing. Perfume is not in the range.

First of all, the price adjustment will be the top three handbags in the world: leboy, 11.12 and 2.55.

In the Chinese market, the selling price of European market will be raised.

Take the Chanel leboy handbag as an example. The classic price 19 yuan of the original price of 32700 yuan is only sold for 26000 yuan in Shanghai, compared with 18 straight down 6700 yuan, and the diving range reaches 20.5%.

According to the detailed data released by US media, the leboy handbag will increase to 3720 euros (about 24617 yuan) in the European market after the price adjustment, which will drop to 26000 yuan in the Chinese market, the difference will be about 1300 yuan, and 11.12 handbags will rise to 4260 euros (about 28190 yuan) in the European market, and the Chinese market will be reduced to 30000 yuan, with a price difference of about 1800 yuan.

That is to say, after adjusting the price, the price of the two handbags increased by about 20% in Europe and about 20% in China, and the difference between them decreased from 59% to 62% in the future to 5.6% to 6.4% in the future.

It was somewhat similar to the scene of the initial price reduction of gold. Yesterday morning, Chanel's major counters in Shanghai continued to flow, and even the lobbyists were full of trouble.

Reporters learned that this stock

Panic buying not only appeared in Shanghai yesterday, but also appeared in many shopping malls in Beijing, where customers queued up Chanel stores.

In the same price cut in Hongkong, some media reported that some Chanel stores in Hongkong yesterday began to restrict customers' purchases, and implemented a one person, one bag restriction policy to ease the occurrence of panic buying.

Why price adjustment? Deal with the depreciation of the euro, and fight against purchasing.

For the price cut of Chanel China, Chanel's statement is to balance the price gap between different regions.

Due to various reasons such as tariff, global

The price of the brand in the Chinese market has been higher than that in the European and American markets.

Coupled with the depreciation of the euro in recent years, the price gap between regions has widened again.

After the adjustment of about 20%, the price difference of Chanel's handbags and other products in China and Europe is less than 10%.

If the euro exchange rate continues to fall, the price gap between the two places will continue to shrink.

According to Chanel President brunopavlovsky, "the price of the Chinese market should not exceed 5% of the euro price."

But the high price of luxury goods in China has always been interpreted as a high tariff. Is the tariff down now?

In the opinion of luxury goods expert Zhou Ting, high tariffs are just excuses for luxury goods selling at high prices in China, and are not the main reasons for the big regional price gap.

Fundamentally speaking, the high price of luxury goods in China is the result of brand markup raising the price of the primary market to overestimate the price of the product.

The strong demand for luxury goods in recent years in China has also pushed up the pricing of products.

"Price return is sooner or later, unfair treatment of the market is always resolved, and everything is afraid of breaking the information barrier.

It breaks the information barrier and makes it difficult for brands to maintain differentiated treatment in different regions.

A consumer industry analyst told reporters that the brand price will not break the regional price gap of painstaking efforts until the last resort.

"Suppression of overseas purchasing market" is indeed one of the important reasons for the "price balance", said rastan, Chanel public relations manager of China fashion department.

No longer? The luxury scene is no longer under the tide of anti-corruption.

Before and after the Spring Festival in 2015, some luxury brands even withdrew part of the European counter or limited supply in order to slow down the purchase of goods from foreign purchases during the low euro.

Analysts believe that the use of overseas purchasing spreads disturbs the development planning and market control power of brands in different regions. Moreover, it is difficult to distinguish between genuine and fake overseas purchasing, which also causes many brands to be troubled by fakes and affects the maintenance of brand image.

After the price adjustment, the buyers who used to make money from the price difference will face the cold shoulder.

In the case of Chanel classic 11.12, the difference between China and France has narrowed to 1800 yuan, plus cross border freight and labor costs, which are almost the same as those purchased domestically.

except

There are other explanations for Chanel's price adjustment.

Jiang Jiongwen, a marketing professor at the China Europe International Business School, told reporters that the high-end consumption caused by China's anti-corruption is also an important reason for Chanel's price reduction.

In 2014, China's luxury market for the first time showed negative growth, which has dropped by 1% compared with 2013.

CNBC, a US financial media, also said that Chanel's price cut in China may be affected by China's anti-corruption.

From yesterday's market reaction, Chinese consumers are still buying the price reduction policy of Chanel.

"If the price reduction policy is effective, domestic sales will go up without affecting the sales of other regions such as Hongkong, and other luxury brands may follow up."

Jiang Jiongwen said.

It is said that in 2015, Chanel's price adjustment policy will cover all products.

But why are luxury goods so expensive in China? Mainly because of tariffs? Wrong! They are so!

The most able to buy Chinese is no longer the "economically underdeveloped areas" people. They sell so much at home that they can go to any cheap place in the world to buy them.

Chanel has dropped, Dior, LV, Hermes...

Will the price go far?