Chanel Partners With Farfetch To Ramp Up Digital Push

PARIS — Chanel may not be ready to make the leap to selling online, but it intends to leverage best-in-class digital innovation to make its physical stores attractive to perma-connected Millennials.

The French luxury firm has joined forces with luxury e-commerce platform Farfetch to develop digital initiatives designed to deliver what Chanel termed an “unparalleled customer experience” both offline and online, in-store and out-of-store.

Chanel has taken a minority stake in Farfetch to demonstrate its commitment to what both companies described as an exclusive global multiyear innovation partnership. Financial details and the size of the stake were not disclosed.

“We have decided to work on the boutique of tomorrow,” Bruno Pavlovsky, president of fashion at Chanel, told WWD in a joint interview with José Neves, founder and chief executive officer of Farfetch.

“It’s not about changing our strategy. On the contrary, it’s to be more focused on our strategy, so the boutique will stay at the heart of our activity, without a doubt. We will continue to propose the best services from the boutique to our customers,” he said.

“But we believe that with the new generation of customers coming, and with the development of digital, it was the right time for Chanel to start to think and to find the best way to anticipate and to enrich the service by using some digital tools,” Pavlovsky explained.

The deal is the first of its kind for Farfetch since it launched its Store of the Future division in 2015 and acquired London boutique Browns, turning it into a testing ground for innovations in omnichannel retail technology, or what it calls augmented retail.

In recent months, Farfetch has been making a big push in China with JD.com, which in June invested $397 million in the London-based platform. Just last week, it unveiled a partnership with Burberry aimed at strengthening the British label’s e-commerce presence worldwide.

“At Farfetch, our mission is to reinvent the luxury shopping experience both online and offline, and we’ve invested more than anyone in this vision,” said Neves, sitting at a roundtable in Pavlosvky’s office here.

The platform employs about 1,000 engineers, a tenth of whom are working in the Store of the Future unit.

“I’m a huge believer in physical retail. I was a boutique owner in my previous life,” continued Neves.

“Fashion cannot be digitized. Fashion is not music, or media, or film. Because it cannot be digitized, the physical experience will always be actually the main experience,” he insisted.

“What physical stores can do, that online cannot do, is the human side of things. Only humans can tell a story, only humans can connect in a certain way, and the technology should be there to enhance the human,” Neves added.

Although they didn’t reveal specific initiatives, Pavlovsky suggested some ways in which technology could be used to better personalize the shopping experience, at a time when more and more of Chanel’s customers are traveling.

At its Rue Cambon flagship, for instance, the brand caters to 50 nationalities, he revealed.

“We want to understand if they know Chanel, if they are already connected to Chanel, what they want to see,” said Pavlovsky. “We want to be able to be much more focused on them and be able to offer them something which fits with what they want.”

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