Chanel the iconic luxury brand to begin sales on the Internet

Historically, i.e. the past 20+ years of the Internet expansion, luxury retailers have generally stayed on the sidelines with the exception of using the Internet for marketing and CRM purposes. Luxury retailers embrace the “personal contact” associated with the luxury transaction not to mention the boutiques situated on high-priced real estate worldwide to promote their brands from New York and Moscow to Abu Dahbi and Shanghai.

Thus, it was a surprise when Chanel, the luxury fashion house known worldwide announced it would begin selling products directly through its website later this year in a landmark decision likely to be followed by rival luxury brands.

Chanel appointed R/GA New York to develop an ecommerce platform. Initially Chanel plans to sell only its fragrances online but may expand to eyewear and accessories.

As mentioned above, many top-tier luxury brands avoided direct sales via the Internet, however, during the worldwide recession of 2009, many iconic luxury brands have suffered a sharp decline in sales due tothe downturn. This has prompted them to refocus their digital marketing strategies to grow sales and gain a foothold in emerging markets.

Related, Marc Jacobs, the US fashion company is also launching an online shop, which is set to go live in August. The site will promote key pieces from the group’s collections as well as perfumes and accessories.

Will the floodgates now open for luxury retalers to embrace the Internet? And how will these brands retain their status and branding associated with exclusivity while on the world wide web? Only time and sales will tell.