To say that Coco Chanel was influential in fashion would be a huge understatement. Ever heard of the little black dress?
Dave Young:
Welcome to the Empire Builders Podcast, teaching business owners the not-so-secret techniques that took famous businesses from mom-and-pop to major brands. Stephen Semple is a marketing consultant, story collector, and storyteller. I’m Stephen’s sidekick and business partner, Dave Young. Before we get into today’s episode, a word from our sponsor, which is, well, it’s us, but we’re highlighting ads we’ve written and produced for our clients. So here’s one of those.
[Oliva Gibbs Law Ad]
Dave Young:
Welcome back to the Empire Builders Podcast. And Dave Young here, Steve Semple over there. That doesn’t mean anything if you’re just listening to this in your car. I don’t know which one of us is here and which one of us is over there. But Stephen told me as the countdown started, he said, “Hey, I got another fashion topic for us.” And I’m like, “Shh, quiet. Let me guess. Let me guess because knowing me, maybe it’s something I know this time.” Right? Right. So I’m thinking Columbia fishing shirts.
Stephen Semple:
I think your other guess was Carhartt.
Dave Young:
Carhartt? Pants from Walmart or Sam’s Club. Probably not those, knowing you and your European travels and your fine taste.
Stephen Semple:
I think you’ve heard of this one though. I think you’ve heard of Chanel.
Dave Young:
Oh, Coco Chanel.
Stephen Semple:
Yes.
Dave Young:
She was in tight with the Germans, wasn’t she? Sort of accused of that? There’s intrigue. There’s movies.
Stephen Semple:
Oh yeah.
Dave Young:
There’s a whole miniseries and things.
Stephen Semple:
There’s a whole bunch of stuff about Coco Chanel, but she did a lot of innovation in fashion man. And I’m going to say this is one, given some of the background things that happened, I struggled a little bit with sort of creating the through line here because I didn’t want all of that stuff to overshadow some of the amazing things that she actually did in the fashion world that was unbelievably innovative.
Dave Young:
Cool.
Stephen Semple:
And today, Chanel remains one of the largest, most profitable luxury companies in the world. They are privately owned by a German family, the Wertheimer family. And so therefore, it doesn’t receive the same attention because it’s not publicly traded, but they do publish annual financials. And so 2025 revenue was 19.3 billion US, profit of 4.7 billion, 38,000 employees operating in a hundred countries. And to put that in perspective, that makes them the same size as Hermes, makes them bigger than Ferrari, 50% larger than Rolex.
Really about the only one that’s larger is LVMH, but LVMH is like 75 luxury brands. So it’s a big deal. Really, really big deal. One of the other things I found interesting is they own dozens of these specialist artistry that do embroidery and feathers and-
Dave Young:
Really?
Stephen Semple:
… and do other luxury components. And they pretty routinely invest about a billion dollars annually in capital investment.
Dave Young:
Wow.
Stephen Semple:
They’re an interesting company, especially when you consider it all started with one tiny shop that sold hats in 1910.
Dave Young:
Hats? 1910?
Stephen Semple:
Just hats, yeah. Coco was born Gabriela Chanel. The name Coco was actually a nickname that came later when she was doing singing in Samoa, France in 1883. So in 1885, her mother dies. She’s 12 years old. She goes to an orphanage where she learns how to sew. Now in 1903, she’s working as a clerk in a seamstress in a shop in Milan that sells lingerie and linens and hosieries and things along that lines. And she’s also singing in cafes, which is where she gets the nickname Coco.
Dave Young:
Okay.
Stephen Semple:
Now it’s here that she meets Etienne Balsan, who’s an aristocrat, and Coco becomes his mistress and lives with him. And one of his passion is breeding horses. So she gets into the whole horse set thing. And there’s these early pictures that show her kind of really dressed very tomboyish for the time, really dressed for the outdoors. And she starts making hats and she wants to open a store selling hats.
Now he feels this is kind of a bit of a passing fancy. So he lends her some money and says, “You can do this out of my apartment in Paris, but we’re not going to do this real store thing.” And during this time, she meets a friend of his, Arthur Boy Capel, who’s a coal mining millionaire. And for a short period of time, the three of them are kind of a triumvirate, but she falls in love with Boy and runs off with Boy to Paris.
Dave Young:
Okay.
Stephen Semple:
Now, this is where things are interesting. They create a gentleman’s agreement on finances. Capel finances the business and Balsan provides the location for their previously shared, I don’t know what status we’re talking about, but this is the part of the story I struggled with because on one hand you could look at this and say she couldn’t have done this without these rich men. But we also got to remember the rules at the time were so limiting for women. She couldn’t have signed a lease. She couldn’t have borrowed money at a bank. All of these things were such that that was the only way you could do something like this. Today she would’ve done it on her own. I’m completely convinced of that.
Dave Young:
Well, and you also have to say they couldn’t have done it without her.
Stephen Semple:
Absolutely, they couldn’t. Absolutely, they couldn’t. But find sometimes these things can diminish her accomplishments and her accomplishments are absolutely immense. So in 1910, she opens her first store at 21 Rue Cambon in Paris selling hats. But this is what made her hats different. At the time, women’s hats were headache-inducing, large, fuzzy, gauze, feathers, really, unbelievably ornate and hard to wear. You actually had hat pins to keep them on and all this other crap.
Her hat’s still large, but they were simple and comfortable. That was her big thing. I want them to be simple and comfortable. Now, location she was in also already had a dressmaker, so she couldn’t make dresses. So she was doing these hats. And then in 1913, she opens a location in Deauville selling dresses. Again, here’s what she did different. Dresses at the time were these heavy corseted affairs. Hard to move in, hard to wear, uncomfortable. She made things that were simple and comfortable. This is what made Chanel so interesting. Simple and comfortable.
Rather than being dazzled by aristocracy, she noticed something else. What she noticed is their fashion looked and felt uncomfortable. Huge hats, corsets, heavy dresses. Women may have looked elegant, but they just couldn’t move around. And this observation of hers created the opportunity. She didn’t just build a better product. She built a different philosophy. Most designers at the time were asking this question, “How can I make women look more extravagant?” Chanel asked the question, “How can I make a woman look elegant and feel free?”
Dave Young:
Okay.
Stephen Semple:
Which is a different question.
Dave Young:
It’s a big difference.
Stephen Semple:
Yeah. It is a big difference. And if you think about it, really what she created was first casual wear.
Dave Young:
Yeah.
Stephen Semple:
Right?
Dave Young:
Yeah.
Stephen Semple:
That’s really the category that she invented. So her next innovation came in 1913 with the dress store in Deauville where she started using this fabric called Jersey Fabric. Now, it’s a cheap fabric that up to this point had only been used for men’s underwear. But what she liked about it was comfortable. It was flexible. It was light. It was easy to wear. So she found this thing that everyone was dismissing, but she saw a value that no one else saw, and she changed the story around it. She basically, again, invented sportswear using this fabric. Isn’t that incredible? Now, here’s her other big innovation, and I didn’t realize this. She’s the one who invented the idea of the little black dress.
Dave Young:
Oh, I think I have a glimpse of that in the back of my storehouse of strange facts, but I probably couldn’t have pulled it out.
Stephen Semple:
Which is incredible how iconic that is. This happened in 1926. So before 1926, early 1920s, black was not considered fashionable for everyday wear. Black clothing was for mourning, was for widows, was for domestic servants, religious dress. That’s what it stood for. And she managed to take black, which let’s face it, no positives there, and made it elegant wear.
If you were a wealthy woman at the time attending a social event, you were expected to wear colorful fabrics, elaborate embroidery, beads, lace decorations. Black was considered too plain. But what Chanel saw was after World War I, the world was changing. A middle class was emergent. Women had worked in factories, they were becoming independent, they were driving cars, they were playing sports, they were entering professional life, and their clothing hadn’t caught up.
Chanel believed elegance wasn’t about showing wealth, it was more about confidence. So she stripped away everything that was unnecessary. If you think about the real breakthrough moment on this was in October 1926, Vogue published Chanel’s simple black crepe dress, and the magazine called it the Ford of Chanel.
Dave Young:
The Ford of Chanel.
Stephen Semple:
The Ford of Chanel.
Dave Young:
Yeah, like a model piece.
Stephen Semple:
Because it was simple, it was reliable, it was accessible, it was timeless, and it was suitable for almost everyone. So instead of being this hope couture that only a handful of women could wear, Vogue predicted that this dress would become the universal uniform for stylish women. And they were right.
Dave Young:
Stay tuned. We’re going to wrap up this story and tell you how to apply this lesson to your business right after this.
[Using Stories To Sell]
Dave Young:
Let’s pick up our story where we left off, and trust me, you haven’t missed a thing.
Stephen Semple:
Instead of being this hope couture that only a handful of women could wear, Vogue predicted that this dress would become the universal uniform for stylish women. And they were right.
Dave Young:
I don’t know. I’m no expert on those times, but when I think of other black garb and we talk about funerals and religious orders and things like that, you think of the flowing robes of a nun or the just frilly, lacy, Victorian era, I don’t even know, dresses that you see women in mourning in, right? Widows and things. And they look extremely bulky and hot and folded and frilly and uncomfortable. And she stripped all that away to where it’s just… What it really emphasized is form.
Stephen Semple:
Yes.
Dave Young:
And let you accessorize and add accents, right?
Stephen Semple:
Exactly.
Dave Young:
You show your arms, that’s like accessorizing the little black dress. And it highlights a piece of jewelry.
Stephen Semple:
Absolutely. Yeah. So what she removed was the heavy embroidery, the bright colors, all of those things. And social rules. She changed social rules around it. So what’s left? A clean silhouette and this simplicity that shifted the attention from the dress to the woman wearing it, which was a revolutionary concept.
Dave Young:
Before that, you would identify basically identity by the wearing of black. There’s a nun, there’s someone mourning.
Stephen Semple:
There’s a woman in mourning. Yeah. But the other thing is it changed the economics of fashion. To your point, Dave, simply change the shoes, the jewelry, the handbag, the scarf, and you change the outfit. And the same dress could be worn lunch, dinner, work, party. Today we call this versatility. Back then, revolutionary.
Dave Young:
Well, and honestly, in the mind, and we talk about this in our portals and the 12 languages, the mind class, the more you layer on things that. If you’re trying to say mourning, you’re mourning someone. Okay, black, folds, lace, hat, veil, all of the things that you associate with mourning. If you’re trying to say a nun, it would be folds and layers and nothing showing except maybe a little white in the hat or somewhere around the edges. And the more things that you layer on that provide it with the reinforcement of that meaning, the more deeply it’s felt to be understood.
So you look at someone that’s wearing all that and you say, “Oh, this is a person that’s in mourning.” And if you strip all those things away and you do something that is different, that makes your head kind of go, “Wait, what’s this?” Instead of being, “Oh, this is a nun.” You say, “Oh, who are you?” You raise interest. You raise interest.
Stephen Semple:
See, this is what she understood. Oh yeah, but wouldn’t it be so easy to go, you can’t do black because black stands for all these negative things. But what she understood exactly what you’re saying, if I strip away all these things, I’m actually creating a new meaning to this color. I’m actually changing the language it’s speaking, which is so difficult and so amazing and so brilliant on her part.
And it’s interesting when you think about she changed the economics of fashion so that essentially what used to happen with elegance is a wealthy woman would own a dozen elaborate dresses. Now, what could happen is a woman of means could have one beautifully designed dress that could do the work of many. So she changed that. You know who else did that when we think about it? If we go back to our early episode of M.M. LaFleur where she looked at fashion and she was a working woman, professional working woman, and she said, “You know what? Fashion doesn’t work for a woman in an office. I need to change the rules. It needs to have a pocket that works, needs to pass the New York taxi test. I can slide out of a taxi with skirt hiking up. I need to be able to bend over and get out a file without Cleavage showing.”
But again, changed the rules around fashion. This is what Chanel did. And the interesting thing is luxury used to say the language of all this dress and whatnot was, how much money can I spend? Where the little black dress said, “I don’t have anything to prove.” It threw out a very different signal. It really was a dress innovation. For her, black was grief. After her, black was sophistication.
Dave Young:
Yeah, and mystery. It’s an intrigue as opposed to, “Well, I get this.”
Stephen Semple:
She persuaded society to see black differently. How freaking incredible is that? That is remarkable.
Dave Young:
She did removing most of the black.
Stephen Semple:
Yes. Yes. Very few people have had that type of cultural influence. So when I was looking at this, I went, “Oh man, she is a remarkable woman to be able to do that.” So when you step back and you think about the hats, the jersey sportswear, the little black dress, they all followed the same pattern. They weren’t three separate innovations. They were three expressions of one insight.
And that insight was women wanted to feel free, not dressed. The hats removed the enormous feathers and decorations. The jersey sportswear removed the stiff, restricted fabrics, and the little black dress removed all the unnecessary ornamentation. And she did one other thing to further free women, handbags. She was the first person to add the shoulder strap to a handbag, freeing the hands.
Dave Young:
All right. I never think of that, but you’re absolutely right.
Stephen Semple:
The question she was constantly asking is how do I give women more freedom while making them feel even more elegant? That was the philosophy of the company.
Dave Young:
That’s so cool.
Stephen Semple:
Yeah. So she became an empire because the hats were successful. The Jersey clothing was successful. Little black dress was successful, all because they proved that same idea. Elegant should never come at the expense of freedom. And that’s the thing she pursued. And when we think about it, at the time, that was even a revolutionary idea.
Dave Young:
Yeah, absolutely right. Absolutely right.
Stephen Semple:
It was what we would call a bold idea. A bold, bold idea.
Dave Young:
I want to watch this movie about Coco Chanel, not the one where she gets. In the ’30s and ’40s, she got caught up with financial problems because everybody in Paris did. The market goes away and she was doing what she needed to do. Leave it at that.
Stephen Semple:
And that’s it. And there’s all sorts of things around how the ownership will come back and forth. And she left for a while and was brought back. But I decided, you know what?
Dave Young:
Yeah, that’s not what built her brand.
Stephen Semple:
And her brilliance was bold. These ideas seem obvious today, but they were bold change ideas that changed the way the world looked at fashion, changed the way the world looked at the color black. And anybody who does that is a remarkable innovator who took this bold idea and ran it out there.
Dave Young:
I love it. I love it. Thank you for sharing the Coco Chanel story.
Stephen Semple:
Remarkable woman. Yeah.
Dave Young:
Next week we’re going to explore the fashion options in the fishing section of Walmart. Maybe we won’t do that.
Stephen Semple:
People will start thinking you fish.
Dave Young:
I don’t. No, I absolutely don’t, but I absolutely do. I like fishing shirts. I just do. They’re comfortable. They breathe a little.
Stephen Semple:
There you go.
Dave Young:
You’d be surprised. Nevermind. You don’t want to know where to. I’ll tell you anyway, you’d be surprised if you go to the fishing section of Walmart to look for a shirt because you don’t expect to find a colorful, bright, comfortable shirt in the fishing section yet there they are.
Stephen Semple:
There they are. All right. Awesome.
Dave Young:
Thank you for bringing Coco Chanel to the Empire Building.
Stephen Semple:
I don’t know where to go with all this. No, we’re done. We’re done. Stick a fork in it. Thanks, David.
Dave Young:
See you next time. Thanks for listening to the podcast. Please share us, subscribe on your favorite podcast app, and leave us a big fat juicy five star rating and review at Apple Podcasts. And if you’d like to schedule your own 90-minute Empire Building session, you can do it at empirebuildingprogram.com.
