The scope of luxury brands is amazing if you dig a bit. Let us look at publicly traded LVMH Group (Louis Vuitton Moet Hennessey). Despite an extremely uncertain economic climate in the US, a very poor one in Europe, and signs of a possible China slowdown, LVMH is chugging along nicely. Sales were up 16% last year despite clear economic headwinds. The company has a stable of brands that reeks of luxury: in wines and spirits they own Moet & Chandon, Dom Perignon, Veuve Clicquot, and Krug Champagne plus Cloudy Bay and Cape Mentelle wines. Hennessey is a big player in the spirits category and a relative of mine visiting Scotland a few weeks ago was surprised to find that Glenmorangie scotch is now owned by LVMH as well. In fashion, leather goods, perfumes, and watches entries include Louis Vuitton, Berluti, Givenchy, Pucci, Donna Karan, Dior, Loewe, Tag Heuer, Bulgari, and DeBeers. In retail they even own Le Bon Marche Rive Gauche and DFS.
Louis Vuitton has approximately 180 stores in China and they are very astute marketers. In more than one article I have read that some Chinese are getting weary of seeing their trademark monogram pattern on products. One Chinese shopper was quoted as saying “everyone has a Louis Vuitton bag, I am looking elsewhere these days.” Well. Everyone, I assure you, does not carry Vuitton but they are now floating many new designs in Asia to respond to customer comments and pre-empt other brands from making serious inroads in their most explosive growth market.
The art world has taken notice. Toney auction houses Sotheby’s and Christie’s now are drawing nearly a fifth of their business from their Hong Kong offices and I have tracked auctions for both in Hong Kong, Macau, Taiwan and mainland China.
Interestingly, Tiffany’s, the epitome of luxury in the US for decades, seems stalled. Some of their business seems to be tied to Wall Street bonuses and European visitors, neither of whom may be spending as much these days as in the past....
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