The Business of Fashion Podcast

Episode: "How Dior and Chanel Are Winning Back Aspirational Shoppers"

Date: February 18, 2026
Host(s): Sheena Butler-Young (Senior Correspondent), Brian Baskin (Executive Editor)
Guest: Joan Kennedy (BoF Retail Correspondent)

Episode Overview

This episode explores how luxury fashion giants Dior and Chanel are shifting strategies to win back aspirational shoppers—those once key drivers of volume and excitement in the category, but who have been alienated by aggressive price hikes. With both brands experiencing stalled growth, the discussion covers how they are adjusting product assortments, creatively rethinking entry-level goods, and renegotiating their relationships with a broader spectrum of consumers.

Key Discussion Points and Insights

1. The “Luxury Reset”: Why Focus on Dior and Chanel?

• Defining the Issue:
  • The luxury market saw average price increases of 36% between 2020 and 2023, with Dior up 51% and Chanel a striking 59%. (01:02)
  • The Chanel medium flap bag nearly doubled in price since 2019.
  • Both houses recently installed new creative directors (Jonathan Anderson at Dior, Mathieu Blasey at Chanel), sparking anticipation about product and strategy shifts.
• Joan Kennedy:
  • “Two of the places that fashion’s pricing problems are most pronounced… And finally, we are starting to see new products from these designers trickle into stores, which has provided us with a little hint at how these brands will address those pricing problems in the year ahead.” (01:10)

2. Scale and Impact of Lost Aspirational Shoppers

• Who Are the Aspirational Shoppers?
  • Over 50 million customers left luxury’s “orbit” post-pandemic due to pricing (Bain report).
  • This segment buys a few luxury items a year, often stretching financially to do so.
  • “It’s a group that is really important… they drive volume and growth for brands and… generate excitement too. But it’s a group that has perhaps been a little bit ignored as the luxury market focused on high net worth and top shoppers.” — Joan (02:45)

3. Re-Introducing “Entry-Level” Products

• Strategic Product Adjustments:
  • Dior:
    • Debut of the BO bag (smooth leather pouch) for €3,700.
    • 87% of Dior's leather goods now priced under €4,000 (up from 69% in 2023).
  • Chanel:
    • New small flap, hobo, and bowling bags for under €5,000.
    • 30% of Chanel’s leather goods now under €4,000 (up from just 4% in 2023). (04:36)
  • “It’s a pretty dramatic shift.” — Brian (04:36)

4. Beyond Bags: True Entry-Level Luxury

• Small Goods and Accessories:
  • Rise in “fun, little whimsical items”—bag charms, headbands, belts, wallets.
  • Example Prices:
    • Dior clover bag charm: €500 (06:28)
    • Chanel headband: €900 (06:40)
  • “Maybe the price isn’t changing, but… there’s a little bit more value… trying to really ride the momentum brought by these new creative directors.” — Joan (06:57)

5. The Value Proposition: More Than Just Price

• Creativity vs. Commodity:
  • Emphasis is now on creativity and the perceived value for money rather than price alone.
  • “Luxury is such an emotional purchase… it’s not all about pricing.” — Joan (07:51)
  • Notable Moment:
    • Joan and Brian humorously debate who among them is a true “aspirational shopper.” (02:42, 06:45)

6. The Macro-Economic Headwinds

• Challenges Remain:
  • Lingering inflation, fears of job loss, and general macroeconomic uncertainty make it hard for many to return to, or enter, the luxury market, even with new products at “lower” price points.
  • “How much of this is a problem with desire versus ability to purchase?... Brands are trying to re-engage.” — Joan (08:42)

7. Competition in the “Affordable Luxury” Space

• New Entrants and Old Rivals:
  • Brands like Jacquemus, Polène, and especially Coach have gained ground with Gen Z and price-conscious shoppers while Dior and Chanel focused on the ultra-high-end.
  • The entry-level segment is now notably more competitive and crowded. (18:01)
  • “Actually, they’re entering a new very competitive category by going back to this aspirational shopper and they don’t have the lead.” — Sheena (18:55)

8. In-Store Experience & Customer Service

• Welcoming Aspirational Shoppers Back:
  • Discussion about whether in-store experiences will also change—less intimidation, more warmth, easier access to “entry-level” goods.
  • “When all you care about are the people dropping a million dollars…who cares about everyone else. But I imagine they’re going to have to roll out the welcome mat…” — Brian (13:28)
  • Importance of merchandising and inviting displays; e.g., showing how bag charms decorate bags. (12:41)

9. Balancing Exclusivity and Accessibility

• Maintaining Brand Aura:
  • Dior and Chanel are steadfast in protecting the high-price halo on iconic bags, but are creative with new entry-level offerings.
  • “They’ve preserved the price point of their core handbags…to maintain that allure of exclusivity while also…bringing fresh creative to it.” — Joan (15:19)
  • Comparison with Ralph Lauren and other American brands that manage wide price segmentation without cheapening the brand. (15:47)

10. Marketing and Trend Leadership

• Shifting Approach:
  • More influencer partnerships (e.g., Dior’s new ballet flat at €890).
  • Challenge: Competing with much cheaper (and viral) ballet flats from Ugg and Puma now dominating “hot product” indexes. (16:56)
  • “I’m really curious to see if Dior can recapture the lead in a trending product like that at that price point.” — Brian (16:56)

Notable Quotes & Memorable Moments

• “According to analysis by Bernstein…Dior and Chanel, prices rose 51% and 59% respectively.”— Joan (01:02)
• “The Chanel medium flap has nearly doubled price since 2019.” — Joan (01:13)
• “It’s a person who makes a few luxury purchases a year…a group that has perhaps been a little bit ignored as the luxury market focused on high net worth and top shoppers.” — Joan (02:45)
• “Dior in 2023, 69% of leather goods were under €4,000. Today it’s 87%. And Chanel only 4% were below in 2023. And now it’s 30%.” — Brian (04:36)
• “A cute little clover bag charm costs €500.” — Joan (06:28)
• “Maybe the price isn’t changing, but…there’s a little bit more value…trying to really ride the momentum brought by these new creative directors and kind of get new marketing.” — Joan (06:57)
• “It’s not all about pricing…Luxury is such an emotional purchase.” — Joan (07:51)
• “Brands just need to pull all the levers and there’s no way to fix things externally. But you just try everything at your disposal.” — Sheena (09:41)
• “It’s also about…how are they bringing people into stores, how are they merchandising those stores…” — Joan (09:59)
• “If ever there was a time for luxury to widen its customer aperture, it seems like now is the time.” — Sheena (14:26)
• “Their goal is not to become Coach…And I think they are very conscious that they can’t edge too far in that direction or… the whole enterprise crumbles at some point.” — Brian (14:41)
• “They’ve preserved the price point of their core handbags…to maintain that allure of exclusivity.” — Joan (15:19)
• “Not to mention, I mean, it always comes back to Coach in the U.S… they are the handbag brand for Gen Z.” — Brian (18:15)
• “If they can execute on all the things that Joan wrote about and talked about today, I think they’re probably going to be fine. Far be it for me to feel sorry for for a high end uber billion dollar brand.” — Sheena (21:01)

Predictions and Closing Reflections

(19:12–21:01)

• Brian:
  • Believes Dior and Chanel can win back shoppers through “thought leadership, creative leadership,” and powerful product launches.
• Joan:
  • Agrees, emphasizing the strong excitement generated by new creative directors.
• Sheena:
  • “Even when luxury struggles, even when the prices have gotten outsized…people don’t truly turn their nose up at Chanel or Dior if they can scrape together the money to buy it...”

Key Timestamps

• 01:02 — Price hike statistics and the effect on the market
• 02:24 — Introduction & scale of lost shoppers
• 03:51 — New entry-level product strategies
• 04:36 — Concrete data on product and price distribution shifts
• 06:20–06:42 — The actual costs of “entry-level” goods
• 07:26-08:15 — Discussion on new psychological/emotional value
• 08:42–09:59 — Macro-economic headwinds and market realities
• 12:41–13:28 — Merchandising tactics in boutiques
• 14:05–15:19 — Service experience and balancing exclusivity
• 16:38–17:27 — Marketing strategies and trend leadership
• 18:01–18:55 — Competitive landscape for “affordable luxury”
• 19:12–21:01 — Final predictions and brand resilience