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PAGE 47 SATURDAY. MARCH 10. 2012 Luxury market is here <strong>to</strong> stay Sales of luxury goods have increased worldwide Many of <strong>the</strong> major players such as Dior and Chanel have seen double-digit growth in 2011. After a strong holiday season, and despite currency concerns over <strong>the</strong> falling euro and <strong>the</strong> soaring Swiss franc, <strong>the</strong> economic recovery has maintained its momentum. Although growth overall is predicted <strong>to</strong> remain flat in 2012, <strong>the</strong> luxury industry continues <strong>to</strong> boom, despite ris- ing gold and diamond prices and <strong>the</strong> resulting price inflation. The industry’s major groups have reported strong sales for 2011. Revenues were up by 16 percent <strong>to</strong> 23.66 billion euros for LVMH. Swatch <strong>Group</strong>, meanwhile, posted a 21.7% increase in sales for 2011 <strong>to</strong> CHF 143 million. Holiday sales in <strong>the</strong> U.S., a major driver of <strong>the</strong> world luxury economy, were positive. <strong>On</strong> Thanksgiving weekend (Black Friday weekend) in <strong>the</strong> U.S., Americans spent a record USD 52.4 billion at retail, with <strong>the</strong> average shopper spending nearly USD 400. Overall, 2011 holiday retail sales in <strong>the</strong> U.S. rose 4.1% <strong>to</strong> USD 471.5 billion. Worldwide luxury Worldwide, according <strong>to</strong> <strong>the</strong> Bain & Company Annual Luxury Goods Market Study, 2010 and 2011 were two phenomenal years for personal luxury goods. The market for 2010 was 173 billion euros (a 13% increase over 2009) and 2011 was expected <strong>to</strong> close at 191 billion euros (a 10% increase over 2010). The study also shows that online shopping for luxury goods has grown by 25% over <strong>the</strong> last two years, and it grew by 20% in both 2008 and 2009. Total online luxury sales for 2011 were forecast <strong>to</strong> hit 5.6 billion euros in 2011. The <strong>to</strong>tal in 2010 was 4.5 billion euros in 2010. The study says 68% of sales were full price. Jewellery and watches The jewellery and watch industry <strong>to</strong>ge<strong>the</strong>r represent 22% of <strong>the</strong> luxury market. Watches in particular are enjoying a strong recovery. After a disastrous year in 2009, sales have recovered <strong>to</strong> <strong>the</strong> point where Bain declares: “Watches lead <strong>the</strong> wave of growth in luxury.” Swiss exports of watches and movements finished <strong>the</strong> year at +19.2%, an amazing recovery considering considering exports were -22 percent in 2009. “The strong recovery in <strong>the</strong> watch industry has certainly occurred,” comments Jean-Daniel Pasche, president of <strong>the</strong> Federation of <strong>the</strong> Swiss Watch Industry. He says investing in new products and new markets accounts for <strong>the</strong> industry’s rebound, following <strong>the</strong> largest downturn in 40 years. “The Swiss watch industry has continued <strong>to</strong> invest in new products,” he says. “Consequently, our industry could benefit from <strong>the</strong> strong recovery, especially in Asia and Substance <strong>to</strong> complement your style INTERNATIONAL MARKETS excepting Japan. <strong>On</strong> one side, <strong>the</strong> big presence of <strong>the</strong> Swiss watch industry in Asia, which shows <strong>the</strong> biggest economic increases, can explain this positive evolution. <strong>On</strong> <strong>the</strong> o<strong>the</strong>r side, we note also a growth of our exports <strong>to</strong> <strong>the</strong> U.S. and Europe which is remarkable in current times.” Pasche acknowledges that “Europe is still a problem, due <strong>to</strong> <strong>the</strong> euro and <strong>the</strong> European crisis. We hope that confidence comes back after <strong>the</strong> different political decisions within <strong>the</strong> European Union. Even in this difficult period we are able <strong>to</strong> improve our exports and I believe it will continue this way. We can also take advantage of <strong>the</strong> Asian <strong>to</strong>urists visiting Europe. They also buy Swiss watches.” Some of <strong>the</strong> jewellery industry’s growth has stemmed from inflation. Jewellery prices throughout 2011 were driven higher by record gold prices and doubledigit increase for diamonds. According <strong>to</strong> a report in Womens Wear Daily, products from Bulgari, Chanel and Dior went Style SUBSTANCE 1 Media Brand Values 2011. 2 BBC Trust Test 2010. Why do leading luxury brands A trusted environment. advertise with us? The advertising environment you choose <strong>to</strong> appear in can have a considerable impact on your brand. BBC World News is a trademark of <strong>the</strong> British Broadcasting Corporation © 1996 Pho<strong>to</strong>: David Gray / Reuters BBC.com and BBC World News are <strong>the</strong> online and TV channels most likely <strong>to</strong> be considered trustworthy. 1 Reap <strong>the</strong> benefits of association – brands are considered 28% more trustworthy when shown on BBC.com. 2 To find out more, contact Laeticia de Belloy on +33 1 44 95 84 06 or laeticia.debelloy@bbc.com .com ▲
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