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A single product can go up to 400 yuan, are luxury beauty products facing a price increase?

release date:2024-02-20 15:39 views:291123

“Chanel perfume and cosmetics are going to increase in price!” Recently, news has spread frequently on social media platforms such as Xiaohongshu that Chanel perfume and beauty products will increase prices across the board around February 21. In addition, many bloggers also revealed that Chanel cosmetics has announced price increases in the Japanese and Malaysian markets. 01 The price of a single product may increase by up to 400 yuan. "It is common practice for luxury beauty products to increase in price." In the Japanese market, the price adjustment letter released by Chanel Japan's official website stated that the prices of some products will be increased starting from March 27, 2024. The reason for the price adjustment was explained in the price adjustment letter as "increase in raw material prices" and was listed at the same time. The specific increase amounts for a total of 56 series of products in the three major categories of skin care, perfume and makeup. Among them, perfume products account for the highest proportion, with as many as 24 price-adjusted series, with price increases ranging from 1,000 to 7,000 yen (approximately RMB 48 to 340 yuan). In addition, Yimeishang learned on social platforms that currently in the Malaysian market, some Chanel perfumes and beauty products have experienced price increases on February 5. According to price comparisons on the official website, the price increases range from 20 to 50 Malaysian Malaysia. For example, the price of loose powder rose from MYR 265 to MYR 295, the price of No. 1 red camellia eye cream rose from MYR 320 to MYR 340, and the price of lipstick and lip glaze rose from MYR 170. to MYR 208. Looking back at the domestic market, many netizens posted claims that they had heard from Chanel’s offline counters that the prices of perfume and beauty products would be raised across the board on February 21. Some netizens shared the specific price adjustment information they learned from the counters. It revealed that the price increase range may be between 50 yuan and 400 yuan, among which the price of the whitening cream will rise from 3,600 yuan to 3,780 yuan, and the price of the brightening essence will rise from 4,250 yuan to 4,450 yuan. Regarding the rumor of price increase, Yimeishang consulted the "CHANEL Chanel Official Flagship Store Perfume and Beauty Products" Tmall store, and its in-store customer service stated that "the brand has not received relevant notifications yet." However, many people in the industry believe that judging from the price increases in Japan and Malaysia, the rumors of domestic price increases may be true. Li Min, the founder of Harbin Meilihui Cosmetics Chain, said bluntly that after years of selling luxury beauty products, price increases for luxury brands have been "commonplace". "Not only Chanel, but brands such as Gucci and Burberry will increase their prices basically every year." 5%, which has become an annual practice.” 02 With price increases and stock out, Chanel beauty products are very popular On the one hand, prices are rising, but on the other hand, there is a "out of stock" wave. When Yimeishang searched for relevant information on the Xiaohongshu platform, she found that many offline Chanel beauty counters in Japan and Malaysia had "purchase restrictions" and "out of stock" phenomena, and many counters in Japan were already in-store. Post a price increase notice. A Malaysian netizen shared the out-of-stock situation. According to him, as of February 1, the four Chanel counters and airport stores in Kuala Lumpur had no jasmine oil, whitening oil, and double-ended lip glaze in stock. Some Japanese netizens also shared that most of the whitening oils at Chanel counters in Ginza, Nihonbashi, Shibuya and Shinjuku in Tokyo are out of stock, saying that it is "difficult to buy." Not only that, from an online perspective, popular products such as loose powder and whitening oil have been out of stock on the Japanese official website since December last year. Many consumers said on social platforms that many of Chanel's skin care and beauty products are very effective, and there is no "equivalent" that can replace them. For example, the above-mentioned whitening oil, loose powder and double-ended lip glaze and other products have been criticized. Many praises have made it the "King of Out of Stock". Regarding this phenomenon, some people in the industry believe that this may be a major reason for product price increases. "Demand exceeds supply, and consumers are willing to pay higher prices for good products, which gives brands great confidence in raising prices." Tian Liming, vice president of Hemaiheda Group, strongly agrees with this view. In addition, he believes that the above-mentioned rising raw material prices mentioned in Chanel Japan’s price adjustment letter are also important factors affecting its selling price. "It can be seen from futures data that the price of raw materials in the upstream of cosmetics has indeed increased." According to data from Business News, since August 2023, the prices of about 14 cosmetic-related raw materials have increased many times, including methanol, butyl acetate, glycerin, urea and other raw materials. For example, the price of urea has increased from 2,623 yuan in August last year. / ton has risen to today’s 2,800 yuan / ton. Hangzhou Yimai founder Jin Ge also added that in addition to the increase in raw material prices, increases in personnel costs, site costs, management costs and other aspects may affect the overall cost growth of the product and contribute to price increases. This part of the reason cannot be ignore. 03 The beauty business accounts for nearly 30%. Luxury brands have made a big move into beauty this year. The popularity of beauty products has brought rapid growth to Chanel's perfume and beauty business. According to Chanel's fiscal year 2022 performance data, Chanel's perfume and beauty business accounted for nearly one-third of annual sales, and sales nearly doubled year-on-year, with online sales accounting for 20%. Behind the rapid growth in performance, Chanel has also continued to increase its strategies in the perfume and beauty business. On the one hand, Chanel continues to introduce new products in subcategories such as beauty and skin care. According to public reports, in 2023, Chanel will release a total of 43 new products. , among which new beauty and skin care products have been launched a total of 17 times, accounting for the highest proportion among all categories; on the other hand, in 2023, Chanel will add 10 new perfume and beauty stores around the world, 8 of which are in mainland China. In November of the same year, Chanel announced the establishment of a new beauty business team called "Concept and Creative Impact Strategy" to lead the influence of the beauty department. Chanel's gains in the beauty market have also made other luxury brands "ready to move". In recent years, more and more luxury brands have joined the beauty market. For example, Valentino Beauty, which will be launched globally in 2021, has achieved an outstanding market growth rate of 126% in 2022; Parda Beauty, which will be launched in 2023, has sold more than 30,000 lipsticks in its Tmall flagship store so far. Just recently, L'Oreal Group announced in a high profile that it has signed a beauty product licensing agreement with Miu Miu, and will develop, produce and sell fragrance and beauty products for it, and will launch its first series in 2025; Coty Group has signed an agreement with an Italian luxury brand Marni has signed a licensing agreement to develop, produce and distribute the brand's perfume and beauty products, and plans to launch a perfume series first in 2026. In this regard, most industry insiders believe that luxury goods entering the beauty market may become the norm in future development. As Xiaohongshu blogger @小 orange Beauty Notes once said in his notes, beauty is the "stepping stone" for luxury goods to attract mass consumers, and most consumers' entry-level luxury products are mostly beauty products. "In order to increase sales and profits, luxury brands are constantly seeking opportunities, and the opportunities are all involved, including the beauty industry." Jin Ge added.