Strategy Culture

Chanel, the French fashion, fragrance and cosmetics house, is developing plans to take its prestigious pedigree into the mass market.

The company will launch two initiatives in 1999 which will attempt to establish it as an accessible brand for consumers under 25 - a target market that Chanel has largely ignored to date.

Its range of nail varnishes has already acquired a youth following, but the new initiatives are aimed at competing with rival fashion houses such as Calvin Klein, which scored a major coup with the launch of fragrance cKone.

The move into the mainstream will not be easy for Chanel, and may require a cultural change at the company. In the UK, the plans led to last week's resignation of marketing director Stephen Gilbert (MW July 23) over differences of strategy and style with UK managing director Didier Sabas.

Gilbert, who resigned after eight years at the company, says: "There will be two very substantial business initiatives which will go a long way towards further establishing Chanel as the mainstream not only in the fragrance but in the beauté (skincare and make-up) sector as well." A Chanel spokeswoman says: "We are going to aim our cosmetics at a younger consumer, but we will retain our 'classic' market. The last thing we want to do is alienate our market.".

The developments will be in keeping with Chanel's exclusive positioning, says Gilbert. Internal differences over how Chanel builds its brand while remaining true to its prestigious heritage partly contributed to Gilbert's decision to leave the company.

In 1995, Calvin Klein decided to carve out the neglected youth market for itself with the launch of cKone - a unisex scent with deliberately non-glamorous, pared down advertising created by its own ad agency CRK. The following year the brand out-sold competing premium fragrances such as Chanel No 5, Yves Saint Laurent's Opium and Estée Lauder's Pleasures to became the leading brand on the market. It followed this with the May 1997...