Doubling Sales in 4 Years: Louis Vuitton's 'Storming Growth' ... "Focus on Sustaining Growth Momentum"

Doubling Since Surpassing 10 Billion Euros in Sales in 2018
Successful Product Line Diversification Strategy... "Economic Downturn Is a Concern"

[Asia Economy Reporter Jeong Hyunjin] French luxury brand Louis Vuitton, which has doubled its sales in four years and experienced 'stormy growth,' is drawing attention as to whether it can maintain this growth momentum, the Wall Street Journal (WSJ) reported on the 11th (local time).

WSJ, in an article titled "The Formula for Louis Vuitton's Global Domination," reported, "Louis Vuitton's sales have doubled in four years. It benefited from the luxury consumption boom following the pandemic and grew sales through regular price increases."

[Image source=Reuters Yonhap News]

According to a report Louis Vuitton released last month, last year's sales amounted to 22.7 billion euros, a 9% increase compared to the previous year. This is the first time Louis Vuitton's annual sales have exceeded 20 billion euros, doubling since surpassing 10 billion euros in 2018.

As the core affiliate Louis Vuitton's sales rapidly increased, the parent company LVMH (Louis Vuitton Mo?t Hennessy) became the company with the largest market capitalization in Europe. As of the 10th, LVMH's market capitalization was 401.8 billion euros. Consequently, Bernard Arnault, chairman of LVMH, surpassed Elon Musk, CEO of Tesla and Twitter, to become the world's richest person in December last year. According to the Bloomberg Billionaires Index, as of the 13th, Arnault's assets amount to 185 billion dollars, a 6 billion dollar difference from second-ranked CEO Musk.

WSJ evaluated, "This brand (Louis Vuitton) has now entered an important phase." Starting this month, Delphine Arnault, eldest daughter of Bernard Arnault, took over as CEO of Dior, and Pietro Beccari, the former Dior CEO, moved to become CEO of Louis Vuitton, marking a change in management. This comes amid growing concerns about an economic recession, with forecasts suggesting that luxury markets in the U.S. and Europe may slow down somewhat.

According to the report, Louis Vuitton has diversified its product range and expanded its price range over the past decade. Unlike the past, which focused on leather goods such as bags and wallets, it has expanded into ready-to-wear for men and women, shoes, watches, and perfumes. WSJ reported that Louis Vuitton store sizes have also increased by an average of 30% compared to ten years ago. Additionally, some prices were raised targeting wealthy customers, while more affordable product lines were created to attract broader public interest.

Benjamin Zimmernauer, research team leader at IFM, France's top fashion school, said that Louis Vuitton's adaptability in the fashion industry, including street fashion, gives it a more modern aura compared to other traditional luxury brands like Herm?s. He evaluated, "This balance between fashion tradition and a modern feel shows that Louis Vuitton holds a very attractive position in the market."