image: Louis Vuitton
There is no stopping LVMH Moët Hennessy Louis Vuitton. Following a report of double-digit revenue growth across all but one of its business groups for 2017 (Wine & Spirits being the outlier), the Paris-based luxury good conglomerate has set what Bloomberg is characterizing as “an upbeat tone for the luxury industry,” with another double-digit growth report. This time for the first quarter of the year.
In terms of its Fashion & Leather Goods division, LVMH reported 25 percent growth (and 16 percent organic growth) over the same quarter last year, citing “continued strong creative dynamic in all its businesses,” and Louis Vuitton’s “remarkable start to the year.” The “reported growth” figure, which takes into account revenue that has been acquired through the purchase of other companies – as distinct from “organic growth,” which takes into account only existing operations – likely has Christian Dior to thank for the boost. LVMH brought the long-affiliated Dior under its umbrella in a $13 billion deal almost exactly a year ago.
The French giant cited China, collaborations, and cosmetics as some of the key drivers of revenue for 2017, and 2018 is looking quite similar. As Bloomberg put it on Monday, “LVMH is getting a boost from a rising Chinese middle class that is traveling more than ever. It’s also gaining from a push to entice young consumers with products like luxury sneakers and iPhone cases styled like Louis Vuitton trunks, and by making it easier to buy products online.”
LVMH, with the help of its 2015-hire Ian Rogers, has turned its attention to the web, in an effort to cater to the millennial consumer and see just how much money these consumers are willing to spend. Given the increased expansion by the group in this sphere, whether it be its 24 Sèvres multi-platform e-commerce venture or its moves to take formerly off-limits brands like Céline online, it seems to be paying off.
As Jean-Claude Biver, head of LVMH’s watch business, told Reuters at the Baselworld watch fair last month, “We didn’t realize the speed at which millennials would take to buying cars or watches online.” LVMH is hoping to bank on the willingness of digital natives to shell out large sums online, whether it be in the form of its Tag Heuer watches or the buzzy wares to come from its marquee brand, Louis Vuitton, under the watch of newly-appointed artistic director Virgil Abloh.
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