This week a representative of Louis Vuitton Moët Hennessy spoke to reporters about the luxury conglomerate’s growing stake in the watch industry. LVMH, which owns several manufactures including Hublot, TAG Heuer and Zenith, has set its sights on its competitors the Swatch Group and Richemont.
LVMH has long dominated the luxury fashion world, with holdings such as Céline, Marc Jacobs, Pucci and Louis Vuitton. However, in recent years they have also made a concerted effort to move into the watch world. Francesco Trapani, the CEO of the LVMH-owned Bulgari, told Bloomberg that the conglomerate’s watch and jewelry sales continue to grow, despite a softening market in China.
“Sales to Chinese continue to be good, although it’s true things are changing a bit,” Trapani said. “Sales are down but they are more than compensated by sales to Chinese outside [the country]. Malaysia, Indonesia, Vietnam are progressing well. It’s not a boom, but certainly these are countries that are growing and becoming more important and more interesting than they used to be with us.”
Earlier this year LVMH’s first quarter revenue report indicated that the conglomerate is indeed seeing continued growth. LVMH saw a 6% increase in revenue during the first quarter of 2013, for a total of €6.9 billion (approximately US$9 billion). The group’s Watches and Jewellery division recorded organic revenue growth of 2% in the first quarter. Overall, it looks like LVMH is performing in line with the trends of the second half of 2012, with tentative growth in Asian markets and the United States, while Europe remains challenging.
“Priority number one is to focus on the brands that we own,” Trapani concluded. “If something really unique, beautiful, powerful is available, then we act.”