Luxury Brands Expanding in Asia

The ESSEC business school and MasterCard Worldwide have released a report that detailing the lessons the luxury industry has applied to the credit crunch from past crises. It also details lessons the major groups and brands can learn from the most recent crisis.

Broadly speaking, the report notes that revenues for the major groups, including LVMH, Richemont, Hermes and PPR, are mixed. In fact, it points out that when considering just the Asia-Pacific region (including China and India but excluding Japan), revenues actually rose for all four groups.

Astonishingly, the report notes that Hermes recorded a massive 30.8 percent revenue growth (H1/09), with PPR just behind at 25 percent revenue growth (Q1/09). Richemont recorded growth of 14 percent (Q1/09) while LVMH brings up the rear of the pack with 4 percent growth (H1/09).

The report does not expand on what this reality might be but it does advise brands to better understand the aspirational habits of their expanding base in Asia. At the same time, the report also provides clear data that emerging luxury markets cannot by themselves support the industry, at least not at the present time.