You are here
Luxury brands' value shrinks US$7 billion as China curbs largesse
[PARIS] Luxury isn't what it used to be.
The value of the top 10 luxury-goods brands fell 6 per cent, or US$7.1 billion, to US$105 billion as companies from Prada SpA to Cartier grappled with slowing sales in China and Russia, research company Millward Brown said in the 2015 BrandZ study published Wednesday.
Only Louis Vuitton and Chanel saw an increase over last year. Vuitton gained 6 per cent to US$27.4 billion, placing LVMH Moet Hennessy Louis Vuitton SE's biggest brand atop the luxury ranking for the 10th straight year. Chanel's value rose 15 per cent to US$9 billion, propelling it to fourth in the list behind second-place Hermes and Kering SA's Gucci.
Spending on gifts has fallen in China as the government clamps down on corruption, while Russia's shoppers are suffering from the ruble's depreciation and sanctions tied to the conflict in Ukraine, Millward Brown said.
At the same time, efforts to appear more exclusive have created opportunities for cheaper brands such as Michael Kors and Tiffany, which finished in the top ten for the first time, the researcher said.
Chanel, the maker of No. 5 perfume, and handbag purveyor Vuitton fared better than their peers thanks to their unique approach, according to Elspeth Cheung, Millward Brown's Global Brandz Valuation Director.
Chanel has harmonised prices across regions, encouraging more in-store consumption, Mr Cheung said. And Vuitton has successfully revitalised its brand with a fresh take on its original LV monogram.
The worst performers were Cartier, whose value decreased 15 per cent to US$7.6 billion, placing it sixth, while Prada slumped 35 per cent to US$6.5 billion, according to the study. An overly expensive product mix and lack of novelty at Prada have led shoppers to spend elsewhere, analysts at Exane BNP Paribas have said.
Hermes's value fell 13 per cent to US$18.9 billion and Gucci declined 14 per cent to US$13.8 billion, according to the study. Rolex fell 6 per cent to US$8.5 billion, placing it fifth. Rounding out the top 10 most valuable luxury brands were Burberry in eighth, Michael Kors and Tiffany.
The luxury ranking is part of a broader study commissioned by WPP Plc, the advertising-company parent of Millward Brown. The study is based on interviews with more than three million consumers and an analysis of companies' performance.
Apple Inc overtook Google Inc as the world's most valuable brand with its estimated value rising 67 per cent to US$247 billion, Millward Brown said. Google's value gained 9 per cent to US$173.7 billion.
Vuitton ranked 34th in brand value across all industries, compared with 30th last year.
BLOOMBERG
No comments:
Post a Comment