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News

People spend more on luxury goods. Sales of luxury goods companies grew ten times faster

12.09.2019
Company: Deloitte

The 100 top luxury goods companies reported aggregate revenues amounting to USD 247 billion in 2017. It represents year-on-year growth of 10.8%. The growth is attributed to large investments in digital marketing and communication on social networks. These are just a few of the conclusions of Deloitte’s global study on luxury goods (Global Powers of Luxury Goods).

“Even despite the economic slowdown on key markets, which include the Eurozone countries or China, business with luxury goods has kept its positive prospects for the future,” says Anna Bezděková, Director in the Audit Function at Deloitte.

The LVMH group is still at the top of the global ranking. Its sales amounted to USD 28 billion. The ranking of the Top 10 companies has not changed much in the past four years. The last change is the replacement of Ralph Lauren by a new player, namely Chanel Limited. The dominant position of the top ten companies is confirmed by their percentage share on the aggregated revenues of luxury goods companies, which amounts to almost one half (48.2%).

More than three quarters (76%) of luxury goods companies reported growth. In half of the companies, the year-on-year sales grew by a two digit number. The highest revenue growth was reported in France, the cradle of fashion, where companies reported growth of 18.7%. On the contrary, Italy was a disappointment as it experienced the slowest sales growth rate despite the fact that most of the top 100 companies – in total 24 - are headquartered in Italy.

“In 2017, the revenues were mostly generated in the segments of cosmetics and perfumes. Seven out of 11 companies in the cosmetics and perfumes segments grew by a two digit number, in total by 16.1%. Customers buy mostly shoes and clothes. Within the 100 top luxury goods companies, definitely the highest number of companies are focused on clothes and shoes, and generally fashion,“ comments Anna Bezděková.

88% of the most successful luxury goods companies are headquartered in nine countries in the world (China/Hong Kong, France, Germany, Italy, Japan, Spain, Switzerland, USA and United Kingdom). The average value of a luxury goods company in France, which is the seat of seven companies, is USD 8.29 billion. The average value of a Top 100 company amounts to USD 2.47 billion.  

“Nowadays, moral attitude and ethics are more important for customers than they used to be in the past. The environment, sustainability, recycled materials etc. are all aspects that customers take into account in selecting and buying goods. And luxury goods are no exception. We can already see that brands such as Prada, Rolex or Tiffany have chosen to follow this path,” adds Anna Bezděková.

 

Top 10 luxury goods companies based on sales

Rank

Company name

Brand selection

Sales in FY2017 in USD billion

1

LVMH Moët Hennessy-

Louis Vuitton SE

Louis Vuitton, Fendi, Bulgari, Loro Piana, Emilio Pucci, Acqua di Parma, Loewe,

Marc Jacobs, TAG Heuer, Benefit Cosmetics

27.9

2

The Estée Lauder

Companies Inc.

Estée Lauder, Bobbi Brown, La Mer, Jo

Malone London, Aveda

13.7

3

Compagnie Financière

Richemont SA

Cartier, Van Cleef & Arpels, Montblanc, Jaeger-LeCoultre, Vacheron Constantin,

IWC, Piaget, Chloé, Officine Panerai, YNAP

12.8

4

Kering SA

Gucci, Bottega Veneta, Saint Laurent, Balenciaga, Brioni, Sergio Rossi,

Pomellato, Girard-Perregaux, Ulysse Nardin

12.2

5

Luxottica Group SpA

 

Ray-Ban, Oakley, Vogue Eyewear, Persol,

Oliver Peoples

10.3

6

Chanel Limited

Chanel

9.6

7

L'Oréal Luxe

Lancôme, Kiehl’s, Urban Decay,

Biotherm, IT Cosmetics

9.5

8

The Swatch Group Ltd.

Omega, Longines, Breguet, Harry Winston,

Rado, Blancpain

7.8

9

Chow Tai Fook Jewellery Group

Limited

周大福珠宝集团有限公司

Chow Tai Fook, CHOW TAI FOOK T MARK,

Hearts on Fire, Monologue, Soinlove

7.6

10

PVH Corp.

Calvin Klein, Tommy Hilfiger

7.4

 

The whole study Global Powers of Luxury Goods is available here.

 

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