Chanel N°5: How to Develop, Market and Sell as Coco Did
Chanel N°5 is a best-selling perfume, launched exactly 100 years ago, on 5th of May 1921. It is first of Chanel’s perfumes. In the time of launch, it was a radical novelty in the European market. Instead of simple floral scent, they compounded it of 80+ ingredients. The form of the bottle was simpler and more elegant than any other perfume. And most phenomenal fact: a businesswoman made it. Her name was Coco Chanel.
This article begins with some facts about Coco and her perfume, followed by tips on how to develop, produce, market and sell as Coco did. In the second part, I’ve described marketing mix or the 4 Ps of Chanel N°5.
Coco Chanel–the first and best business women of the 20th century
How much do you know about Coco Chanel? Until recently, I knew her only for her evergreen designs and not so much for her life story. What I’ve discovered recently is how genius she was in terms of business. With no prior economic education, she established brand, which has remained well known for the past 112 years. Her perfume, Chanel N°5, has been a best seller for generations and there is so much we can learn from the story about development of this popular product.
Mademoiselle Coco and the scent of love
This article is inspired by a novel about Coco Chanel, Mademoiselle Coco und der Duft der Liebe by Michelle Marly. (English translation would be “Mademoiselle Coco and the scent of love”). The novel is, as written by its author, an interpretation of historical facts. Thus, it’s not all 100% truth, but author based the story on actual facts. It describes time of Coco’s life between years 1919 and 1922, when she developed and launched first Chanel perfume, Chanel N°5. I’ve drawn all details related to how Coco did business and marketing from this exciting novel.
Coco made perfume as memoir to her late lover, Boy Capel. When she started the project, she knew nothing about making or selling perfumes. After some serious studying, a lot of networking and strategic decisions she launched product made of 80+ scents. The perfume which was an instant and disruptive novelty in European market. It was the combination of Coco’s love of perfection and her skill to simplify, that transformed “yet another perfume” into the best seller of the century.
How to develop, produce, market and sell as Coco does?
Well, I’ve put down some notes to share them with you.
If someone would like to be like Coco in business, what should they do?
Those are some general business guidelines inspired by the development of perfume Chanel no. 5.
One should be continuously learning. Coco’s power is in her knowledge. When she’s decided to develop perfume, she knew nothing about the fragrance category. She would study terminology, did a lot of reading, and found a mentor. Once her perfume was ready, she could easily talk with the chemist about all details in product development. She also appreciated and collected books of all sorts.
One should have excellent networking skills.
Coco knew not only how to network but also how to listen carefully. Thus, she’d always have some topic to talk about when it was her turn to speak.
One should not care about others’ opinion.
Coco simply ignored any gossip from her clients, nor she cared about her rivals. Even more so, she would turn the gossiping in her favor, so it transformed into a powerful word-of-mouth promotion.
One should have strong work ethics.
Coco’s workday in her studio started at 7 am and ended at 7 pm. By coming early and on time, she was a role model for the team of employees.
One should be poised and presentable always.
Coco would spend an entire hour in the bathroom before going to work at 7.00. She gave advice to Grand Duchess Maria Pavlovna on how to have more style. In the conversation with Pavlovna, Coco emphasizes the correlation of having a wealthy look and business success.
One should always stand out from the crowd.
Coco knew how to differentiate her products in the market. When developing something new, her motto was to break the rules. For example, she named the perfume after her lucky number while competition always named perfumes after a designer brand (i.e. Eau de Chanel).
One should not hide, but share their ideas.
By talking about perfume, Coco could network even more. When she spoke about development of her ideas, her connections would enable her to meet people from all around France; e.g. business owners, perfumers, chemists, artists…. Then those new contacts could offer her what she was looking for.
One should think out of the box.
As a lady in a world of business, Coco had to invent her way to gain authority and respect.
Marketing mix & the 4 Ps of Chanel N°5
What was Coco’s marketing strategy for one of her best sellers, perfume Chanel N°5? There are many insights in the novel. I’ve put them into 4 categories, known as 4Ps of marketing mix; product, price, promotion and place.
Do not reinvent the wheel.
Regarding the composition of fragrance notes Chanel N°5 was not something new. It was a novelty only for the European market. Coco got inspiration from the Russian royal perfume “Bouquet de Catherine”. Similarly, the revolutionary simple form of glass jar was not new. Coco brought it from other categories (the novel says pharmaceuticals, other sources say alcoholic beverages).
Quality over quantity without rush.
In the novel, Coco mentions few times that only perfection is acceptable when developing a new product. She started the development of perfume under mentorship of the biggest French perfumer of the era, Francois Coty. In those times, perfumes had only a simple floral scent. But Coco wanted something more, something more complex but elegant. When Coty couldn’t deliver what she envisioned, she’d peacefully go in pursuit of alternative ways. Luckily she came in contact with French-Russian chemist, Ernest Beaux and his team, who knew very well which perfume inspired Coco. She liked all of 10 samples already at their first meeting and confirmed a sample number 5. When Beaux told her they made sample using many very expensive ingredients, Coco didn’t blink an eye. At the same time, she was never afraid of competition because she relied on the fact that Chanel’s product is perfect.
Have a story behind the product.
The perfume was a memoir of the late lover. 5 in the perfume’s name is Coco’s lucky number five.
Premium product sells for premium price.
Coco knew best ingredients cost money. She also had knowledge that there was target audience public, who was going to pay this price.
Let sellers do their job.
Coco would remain a quiet and hidden observer when clients visited the shop. The reason was so many rich people were trying to bargain for premium products. They hoped personal connections with famous designer will lower the price. Coco also knew such clients acted like snobs. They wouldn’t try to negotiate the price when talking only to a seller.
Daily financial control.
To Coco, money meant freedom. Therefore, she learnt how to operate with the income. She would examine bookkeeping documents daily in order to make sure her business was making a profit.
Power of WOM
Coco was queen of word-of-mouth promotion. She would use it frequently. For example, she gifted her best dresses to the models, because they would wear them again among the ladies of high society. She would use same tactic in case of perfume. After she’d had launched the perfume, she disappeared from Paris into a vacation house, where no one could visit. So, clients could not share their opinion with her, but talk to other women. First few bottles were gifts for loyal customers. Friends of those customers were then the first buyers of Chanel N°5.
At first, it was difficult to buy Chanel N°5. Not only product had a premium price, buyers also had to be very persuasive in other to get a bottle from the seller.
Launching perfume meant Coco was entering a new category. Until then, she would only sell hats and clothes. While developing the product Coco visited cosmetic shops many times and asked herself how should she enter those shops with only one product in the category. However, she was always courageous enough to do things her way. When it was time to sell the Chanel perfume, she kept it in-house. Thus, this instant popular item was available only in 3 places in France: in her boutiques in Paris, Deauville and Biarritz. By selling without intermediaries, she could keep control over selling process, its costs and clints’ feedback.
Coco was the first and best business women of the 20th century. The novel written by Michelle Marly gives us a unique opportunity to uncover all the key moments of developing an amazing product. After all, who wouldn’t like to learn from the best seller of past hundred years?