NEWS

  • Luxury Gets a Boost From Tourism and Strong Results

    2017-04-05 | https://www.businessoffashion.com/articles/market-pulse/luxury-gets-a-boost-from-tourism-and-strong-
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      More good news from market leaders and a healthy resumption of tourism bode well for the luxury sector.
       
      Savigny Luxury Index March 2017 | Source: Savigny Partners
      LONDON, United Kingdom — The Savigny Luxury index (“SLI”) rose a very respectable 6.6 percent in March, whilst the MSCI World Index (“MSCI”) flat-lined. A string of good results announcements, as well as signs of resumption of growth in luxury markets around the world including all-important tourist flows, put a spring in the step of the SLI.

      Big news
      Hermès announced record-breaking profits for 2016, adding to the series of positive results announcements over the last couple of months. Moncler, Brunello Cucinelli and Tiffany also posted strong numbers, notably lifted by sales in China for all three companies. Tourists have been heading back to Europe: tax free sales grew by 21 percent in January, the second consecutive month of growth after a year of decline. Likewise, the Middle Eastern luxury market has seen a rebound, thanks to increased oil prices but also increased tourist flows from India and Africa. Even some of the bigger players in the watch sector are beginning, albeit very cautiously, to feel optimistic for 2017.
      LVMH is diving head first into the world of multi-brand e-commerce and will launch a new site in the next few weeks. It will be offering LVMH brands as well as a selection of third-party brands. The group already owns Sephora, which has a very strong digital presence. Industry observers expect the Internet to account for 20 percent of luxury sales within a decade, up from about 7 percent today.