National News

Think of it as an exclusivity tax

Marketplace - American Public Media - Fri, 2014-12-05 02:00

On the upper east side of Manhattan in a very elegant apartment, just a few blocks away from the Chanel boutique, Jean Shafiroff is a fan of the brand. 

"Styles come and go and brands come and go but it seems to me that Chanel remains," she says. 

Shafiroff is wearing a forest green wool jacket (Chanel) and she's taken out a few of her Chanel bags to show to a reporter some of the classics. They have the signature quilted flap and interwoven metal and leather chain shoulder strap. She says, "If I’m willing to use a bag that I bought over twenty years ago, I think it’s pretty much a classic, don’t you?"

Philanthropist Jean Shafiroff with a classic Chanel bag and a biography of the designer.

Sally Herships

But this is about more than just fashion — Shafiroff sees her choices as investments. "Like buying a piece of art," she says. 

A philanthropist on the board of seven charities, Shafiroff hosts a lot of fundraising events, and she bought her first Chanel bag, the classic one —  with the quilted flap and the leather and metal chain — in the 80’s. She still carries it.

"It's more chic now than it was then, because it’s vintage," she says.

But there’s nothing vintage about the price. In the mid-eighties, a classic Chanel bag was under a thousand dollars. Adjusted for inflation, the price today should be about double. But a similar purse now costs north of $4,000 dollars, way past the rate of inflation. The cost of labor is up, not to mention leather. Then there’s the euro versus the dollar — But, says Paul Swinand, an analyst with Morningstar, there’s another big reason the prices for Chanel bags have climbed so high.

"There are more rich people in emerging markets, and they’re getting richer faster than we are," he says.  

Says Swinand, in markets like Asia, wealthy consumers have an enormous appetite for western goods: "They want Cognac. They want LVMH bags. They want Swiss watches."

And they want Chanel purses, but they don’t want everybody else to have them too.

 

A sequined Chanel bag owned by Jean Shafiroff 

Sally Herships

"Think about it. You wouldn’t want everybody to have a Tiffany ring. You wouldn’t  want everybody to have an Hermes bag," says Swinand. "The allure of a Patek Philippe watch or a special signature Chanel bag is to walk in and say, 'Oh my gosh, those are hard to get, you must have paid a lot of money for that.' Maybe you don’t say that explicitly but that’s the allure."

And Chanel knows it. So it keeps raising prices. Think of it as an exclusivity tax.

"This is not inflation increases, this is something that is really extraordinary, and replicates the index of living extremely well," says Thomai Serdari, a professor of  marketing at NYU’s Stern School of Business.

She adds, "it is a manufactured, namely, an artificial market that keeps going up, as long as there are people who are wiling to spend."

And Chanel isn’t the only brand to have taken this approach. Think Ferrari. Even Nike, says Serdari, used pricing to set its sneakers apart. Burberry famously raised its prices after its trademarked plaid started becoming too popular.  

From a business point of view, Jean Shafiroff can appreciate the exclusivity strategy — After all, she has an MBA.  

“They’re making it less accessible and I think that’s a very smart business technique,” she says. But from a personal point of view, Shafiroff says she doesn’t have plans to buy a new Chanel bag anytime soon.

Just stop by Chanel's Madison Ave boutique and you can see the brand's strategy at work. To reinforce how precious they are, purses are presented on pedestals, one by one. 

"Displayed the way objects would be displayed in a museum," says Sedari. “It is intimidating. It is done on purpose, it should intimidate you. You shouldn’t feel like anybody can participate in that world.”

Improved job creation expected for November

Marketplace - American Public Media - Fri, 2014-12-05 02:00

On Friday, the Labor Department reports on November job creation and unemployment. Economists predict companies and government offices added 230,000 jobs, and that the unemployment rate was unchanged at 5.8 percent.

Over the past year the economy’s been adding on average 220,000 jobs per month. And the quality of jobs has gradually improved, says Mark Hamrick at Bankrate.com. One year ago, he says, the strongest job growth was in relatively low-skilled, low-paid sectors: bars and restaurants, hotels, retail.

“We’re seeing a greater collection of sectors participating in job creation,” says Hamrick, including “professional and business services, health care, construction, occasionally manufacturing.”

Outplacement firm Challenger, Gray & Christmas has predicted a strong hiring season for seasonal retail jobs, with companies including Amazon, Macy’s, Fedex, UPS, Walmart, Kohl’s and GameStop planning to increase hiring over last year. But after disappointing sales on Black Friday, “companies look at the traffic in their stores,” says John Challenger, “and if it’s really going to be down longer-term, they’ll pull some of those people back.”

Wilt Chamberlain stamp signals a shift for USPS

Marketplace - American Public Media - Fri, 2014-12-05 02:00

When you think of stamps, you might picture paintings of ducks, and dead, forgotten presidents. But Friday in Philadelphia, two new stamps will be released, the first ever to feature a pro basketball player.

You could say he’s the basketball equivalent of Madonna or Elvis because the new stamps dispense with his last name and only say “Wilt,” stretched out as if to emphasize his 7-foot-1 stature.

“Wilt is the greatest player to ever play,” said Donald Hunt, a sports writer for the Philadelphia Tribune who headed the effort to get Wilt Chamberlain his own stamp. “He scored 100 points in a game, averaged 50 points in a game... at one point in his career he grabbed 55 rebounds in a game.”

But Chamberlain also did other stuff, including claiming that he slept with 20,000 women. The NBA star joins recent postal honorees like Janis Joplin and Jimi Hendrix, who died of drug overdoses. But that doesn’t mean they don’t deserve stamps, according to Chad Snee, editor of Linn’s Stamp News.

“If the committee had to weigh personal imperfections when determining whether or not someone could be honored with a postage stamp … we wouldn’t see too many people on our stamps anymore,” he said.

Silicon Tally: Ciao, TTYN!

Marketplace - American Public Media - Fri, 2014-12-05 02:00

It's time for Silicon Tally! How well have you kept up with the week in tech news?

This week, we're joined by Rusty Foster, who writes the Today in Tabs newsletter, covering the "worst (and occasionally best) in tabs."

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A Miami School Goes From Blank Canvas To Mural-Covered

NPR News - Thu, 2014-12-04 23:35

Jose de Diego Middle School has large expanses of facade that are almost begging for decoration. To raise funds for arts education at the school, artists are helping transform its walls with paint.

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Civil Rights Attorney On How She Built Trust With Police

NPR News - Thu, 2014-12-04 23:33

Over the past 20 years, the Los Angeles Police Department has been reformed to work better with minority communities. One of the main forces behind that reform has been attorney Connie Rice.

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Caring For AIDS Patients, 'When No One Else Would'

NPR News - Thu, 2014-12-04 23:29

Ruth Coker Burks has no medical training, but has spent decades caring for people with AIDS. "I've buried over 40 people in my family's cemetery," she says, "because their families didn't want them."

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As Ebola Surges In Sierra Leone, Communities Take Control

NPR News - Thu, 2014-12-04 23:25

With the number of new infections reaching a record high, there's no time to wait for international aid to build perfect Ebola treatment centers. So village leaders are making do with what they have.

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For World's Oil Exporters, Falling Prices Have A Domino Effect

NPR News - Thu, 2014-12-04 23:24

Falling oil prices have been good news for the U.S. But it's causing multiple problems for some exporters. Government budgets are strained. Economies are struggling. Currencies are crashing.

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Renewed Protests Over Garner Case In New York, Beyond

NPR News - Thu, 2014-12-04 18:00

The demonstrations come as the U.S. Justice Department investigates the recent police killings of Michael Brown, 18, in Ferguson, Mo., and of Eric Garner, 43, of Staten Island, N.Y.

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DNA Pioneer Watson's Nobel Prize Sells For $4.75 Million

NPR News - Thu, 2014-12-04 15:54

The Nobel Prize that James Watson won for helping explain how DNA is structured has a new owner. Watson has said he'll donate much of the $4.75 million sales price to educational institutions.

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A Burger Joint Pays $15 An Hour. And, Yes, It's Making Money

NPR News - Thu, 2014-12-04 14:46

Fast-casual chain Moo Cluck Moo, in suburban Detroit, pays all of its workers far above the typical wage for a fast-food employee. It's part of its business model.

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Court Rules Chimps Don't Have Same Rights As People

NPR News - Thu, 2014-12-04 14:04

The New York Supreme Court's appellate division declined to extend habeas corpus to Tommy, a chimpanzee living in a cage at a trailer dealer in Gloversville, N.Y., to a sanctuary.

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Red Cross Misstates How Donors' Dollars Are Spent

NPR News - Thu, 2014-12-04 14:01

Red Cross officials have repeatedly said 91 cents of every dollar donated to the charity goes to disaster relief services. But an investigation by NPR and ProPublica found that's just not true.

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With Harvest Season, 'Trimmigrants' Flock To California's Pot Capital

NPR News - Thu, 2014-12-04 13:52

Humboldt County is famous for towering redwoods — and pot. Every fall, young people descend on its small towns. They're seeking work as trimmers, who manicure marijuana buds to prepare them for sale.

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At Beer Mile Championships, Scientist Sets New Women's Record

NPR News - Thu, 2014-12-04 13:45

In a dizzying finish, American Elizabeth Herndon set a new women's mark in the Beer Mile World Championships in Austin, Texas, last night.

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'New Republic,' In Major Change, Cuts Publishing Schedule; Top Editor Out

NPR News - Thu, 2014-12-04 13:29

Editor Franklin Foer and longtime literary editor Leon Wieseltier are both leaving. The magazine will drop to 20 issues a year from 10 and move its headquarters from Washington, D.C., to New York.

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North Korea's Cyber Skills Get Attention Amid Sony Hacking Mystery

NPR News - Thu, 2014-12-04 13:21

A North Korean official now denies its involvement in one of the worst corporate hacks in history, after a different official played coy. How sophisticated are the Hermit Kingdom's hackers?

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Who Made That Flavor? Maybe A Genetically Altered Microbe

NPR News - Thu, 2014-12-04 13:02

Biotech companies are inserting new genes into microorganisms, turning them into tiny factories to produce valuable nutrients and flavors. But many of them don't want to talk about it.

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Unhappy Toy Story: Foot-Powered Scooters Drive ER Visits

NPR News - Thu, 2014-12-04 12:59

A look at injuries that sent kids to the emergency room shows an Everest-like mountain of problems with scooters. After falling slightly from a 2001 peak, the scooter injuries started to rise again.

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