$15,000 bags at dawn: the battle to be Chanel No 1

The luxury sector often works in ten-year cycles: no change, then all change. With the top job at the fashion house up for grabs, the whole industry may be about to undergo a seismic shake-up.

Models present creations by Chanel for the Women Ready-to-wear Fall-Winter 2024/2025 collection as part of the Paris Fashion Week, in Paris on March 5, 2024. Picture: AFP

Imagine the fashion industry as a Jane Austen ball meets musical chairs, its designers all executing gracefully sequenced moves with politesse and the odd snooty glance. Then, when the music stops, they all trample over each other to sit down.

We are in such a moment now, with the announcement on Wednesday evening that Chanel’s artistic director, 62-year-old Virginie Viard, is stepping down. The luxury sector tends to work in ten-year cycles: no change, then all change. The Chanel job is one of the most plum seats in the business and some of its major players have been holding out for years for this particularly prestigious chair.

Front-row types love nothing more than to speculate over who might go where, and there are already plenty of names in the hat. Chanel might be the quintessence of Parisian chic but the Italian chapter has been busy in recent months too - perhaps getting their own dance cards in order.

In March, Pierpaolo Piccioli left Valentino after 25 years, a veteran of couture-level elegance and Gen Z-approved trends (it was he who created Florence Pugh’s infamous hot pink “nipple” gown). He will be replaced there next spring by Alessandro Michele, the bearded kooky-kitsch genius behind Gucci’s recent decade as most wanted. After two seasons under Sabato de Sarno, that label now has more of a wardrobe focus (fashion-speak for jackets and jeans) after Michele’s dressing-up box aesthetic (pearls and peacocking). It is also, its parent company Kering announced last month, down 18 per cent in the first quarter of 2024.

Back in Paris, at Celine, the controversial designer Hedi Slimane - he whose skinny indie-kid tailoring famously inspired Karl Lagerfeld to go on a diet in the Noughties - has for months been locked in negotiations surrounding the renewal of his contract with the house. Did he know ahead of time that Chanel might be up for grabs?

The outgoing Chanel artistic director Virginie Viard. The vacancy at the fashion house heralds something of a new era across the board. Picture: AFP

There is no Maison Margiela catwalk show on the couture schedule in Paris this month either, which suggests the critically acclaimed collection its designer John Galliano presented in January was his swan song. The very public spectacle of Zendaya, Ariana Grande and Kim Kardashian wearing Galliano’s designs at the Met Gala last month was widely interpreted as a rehabilitation of the man who was cancelled in 2011 for antisemitic slurs outside a Paris cafe, ahead of a potential announcement later in the year. The top job at Givenchy is also vacant, expected to be filled by September.

Viard was Lagerfeld’s chosen successor, having been his right hand there for 30 years, and took over at Chanel after his death in 2019. Although she has brought her own modernising influences to the label over the past five years - more casual clothing, fewer gimmicks - Viard’s reign has essentially been an extension of her mentor’s, whose own almost four-decade tenure spanned the industry’s wider metamorphosis from insider’s closed shop to 24-hour digital storefront.

Viard’s reign has essentially been an extension of her former mentor’s Karl Lagerfeld, left. Picture: Getty

In that time, luxury prices - especially handbags - have gone through the roof. What was eye-wateringly expensive at, say, $2,300 ten years ago is now mind-bogglingly so at $4,800. At Chanel - always on the top rung - a classic 2.55 flapover bag sold for about $4,800 in 2008. These days, it is on sale for $17,000. One of the house’s signature boucle jackets will set you back $14,800. Dior’s classic Bar jacket is now $6,700. The average price of luxury goods has risen 52 per cent since 2019 alone.

But the boom times appear to be - temporarily, at least - over. The market is readjusting after so many post-pandemic splurges, with aspirational shoppers cutting back as living costs rise and even the richest apparently tightening their logoed belts. Although Chanel reported double-digit growth in sales and profit last month, its outlook was cautious.

These days a classic Chanel 2.55 flapover bag is on sale for $17,000 as luxury prices have gone through the roof. Picture: Getty

“After three years of exceptional growth, we are now entering a more challenging environment,” said Philippe Blondiaux, the house’s global chief financial officer.

Kering - which owns Balenciaga, Saint Laurent and Bottega Veneta - also announced last month that operating income would be down as much as 45 per cent in the first half of the year. Its rival LVMH does not give out numbers for the individual brands in its stable (among them Louis Vuitton, Dior and Fendi), but with revenue growth reported at 3 per cent in April - after a bumper 8 per cent rise in profits last January - the slowdown seems to have reached Bernard Arnault’s doors too.

That is why the vacancy at Chanel heralds something of a new era across the board: the next iteration of fashion’s top creative brass will be tasked with reinvigorating not only lacklustre sales but potentially an entire business model.

“Something’s got to give,” says Mimma Viglezio, a creative consultant who has worked at Gucci and Louis Vuitton. “Prices are outrageous at the moment - T-shirts for $3,800. It’s not enough for a big brand with revenues of billions to sell an ostrich bag for $58,000 if nobody else can afford anything.”

Back to that ballroom and it is no coincidence, then, that so many of them seem to be watching the band rather than their dancing partner. Also being talked of: Sarah Burton, the designer of the Princess of Wales’s wedding dress, who stepped up at Alexander McQueen after the designer’s death in 2009 and departed last September - though she is believed to be enjoying time with her family rather than seeking out a new posting.

When Burton’s replacement at McQueen, Sean McGirr, was announced last October, there was disappointment that Kering’s creative line-up was now exclusively young white men.

Sarah Burton, the designer of the Princess of Wales’s wedding dress, is being talked of as a potential candidate to fill the top job at Chanel. Picture: Getty

“One can only hope these top jobs will go to female creative directors,” says Elektra Kotsoni at Vogue Business. “Women know how to make clothes that women like wearing.”

That’s why the former Celine designer Phoebe Philo is many a fashion editor’s dream pick for the Chanel gig, but she is expected to want to concentrate on the own-brand label she launched last October. Whoever does get the job has a big task on their hands: nobody working in the industry right now can remember, let alone imagine, a Chanel that looks any different - and it is a tricky climate in which to launch anything radical.

“There is a moment of change going on,” Viglezio says. “Any time there is a crisis, people start firing and hiring in fashion, so I’m not surprised with two wars and the economy the way it is [that this has happened].”

It is said that Nicolas Ghesquiere, the designer at Louis Vuitton, employs his own shaman to predict which dates will be most auspicious when choosing outdoor venues for his shows. As the world’s glitziest and most ruthless industry seeks to change the weather, whoever gets the job at Chanel might want to ask for his number.

The Times