fiogf49gjkf0d
For this years first quarter LVMH announces a plus in revenues of 4%.The Kering group increased sales by a rate of over 6%. More announcements of other market players will be published in the next days. The Federation of the Swiss Watch Industry as another market indicator informed about a plus of watch exportations in value of 4,0% (pieces +1,5%) for Q1 2014. While mechanical watches increased by 7, 4% electronic watches experienced a decline of 7, 3%.
Recently, Baselworld delivered mixed signals as another benchmark of the luxury market¹s outlook. This year again an impressive number of some 1.500 brands presented over 10.000 novelties. Yet, the show lacked true collection or product highlights. The times of substantial price increases seem to be over for now. Basel showed also less visitors then last year - this especially with regard to Asian retailers and media representatives and here in particular those from China.
Various brand stated their year end sales estimates for 2014 before and during Baselworld (Reuters): Patek Philippe and Ulysse Nardin expect a growth of ca. 2%, while Tiffany as well as the Swatch Group expect a high one-digit percentage increase, LVMH Horlogère (5-7%) and Hermès position their prognoses in between. Small brands will most likely achieve ¬ on average - numbers below those estimates. This will put pressure on margins and budgets and ought to effect negatively the business of service providers such as advertising, merchandising, event agencies or product designer.
In this situation the market remains sensitive to external influences for instance the continuous efforts of the Chinese government to curb down corruption or the developments in Ukraine. Other factors need to be observed, too: In these days the European parliament voted for a new definition of the certificate of origin (³Made in ...²). In case the council confirms that decision then many manufacturers of high-end products could face problems. In the future the country of origin shall be linked to the place where the last substantial, commercially important manufacturing has occurred ¬ following the EU¹s codex of customs. This could have consequences for those countries in which products are developed and marketed but not produced (e.g. shoes, fashion, watches, technical appliances).
Market Intelligence:
A highly interesting study published by the Sinus Institute analyses global luxury spending in comparing various countries. More information is available here. The Sinus Institute in conjunction with the Responsio Institute publishes also the German Watch Monitor. It is the very first representative study that focuses on one particular market in questioning more than 5.000 consumers with regard to their attitudes, purchase intentions etc. concerning 220 watch brands.
TBTL:
Tempus fugit ¬ in Mai 2014 The Bridge To Luxury will celebrate its fifth anniversary. Being founded as one of the world¹s first consultancy firms to focus exclusively on high-end brands, TBTL has been able to carry out a multitude number of exciting and successful projects to assist international brands. TBTL is thankful for wonderful partnerships. The luxury industry is in a dynamic process of change. To assist clients in their quest for professionalism and success in developing and managing their brands remains the ambition of TBTL. Publishing articles on the topic of luxury, prestige, premium & Co. is part of that effort. Early April, for instance, the CP-Monitor printed a TBTL contribution on glossy consumer magazines edited by luxury brands. The article can be downloaded here.