March Global Luxury Market Scan 2019 Luxury Industry Is Expected To Grow Strongly

Not all luxury companies performed well in 2018. Tiffany, Ferragamo (Ferragamo), Tods (Tod 's) and Prada (Prada) announced 2018 earnings were lower than expected, but they remain optimistic about the outlook for 2019.

Ferragamo's same store sales in the first few months of this year have improved.

Although Prada and Tiffany have shown signs of weakness in recent pactions (especially in relation to the decline in demand in China), the group is still growing, and Tiffany plans to revive its electricity business in 2019.

At the other end, Herm s's performance is very prominent, and the brand does not see signs of slowing demand in the Chinese market.

The luxury group's operating profit has exceeded 2 billion euros ($2 billion 200 million), but it failed to reach a record profit in 2017 because of the increase in investment prices.

Galeries Lafayette, a new flagship store on Champs Elysees street, is subverting the existing department store model.

Shops in stores (shops-in-shops) are out of date, and merchandising is popular based on style or trend across gender and product categories.

Customers can book one of 300 "Personal stylists", who will help customers shop in stores through an application that allows customers to upload preferences, pick records, fitting photos and body data.

The application can communicate with designers before entering the store, in the three stages of the store and after departure.

Lafayette department stores also launched smart hangers to show the size of Stock clothing.

Customers can choose their own size and take it to the fitting room.

Although many department stores have tried to combine technology with traditional retailing, the new model of old Buddha's department store is unique. The core of its products is the stylist, and then provides better ordering services with the help of technology.

In several pactions in March, the beauty industry is still hot.

Bain Capital has brought the French cosmetics manufacturer and brand Incubation Platform Maesa into its two acquisition.

Puig, a Barcelona based cosmetics group, invested in emerging markets. The group bought a minority stake in India's leading brand Ayurvedic Ayurveda Kama Ayurveda, and Columbia beauty retailer Loto del Sur for 12 million 500 thousand euros ($14 million).

Equally important, Glossier announced that it had raised $100 million in D round financing of Sequoia Capital.

The American beauty company, started by blog, is now valued at more than 1 billion 200 million dollars.

In the aspect of accessories, ASHS Ltd., headquartered in London, sold the brand Anya Hindmarch to the British investor Marandi family, which invested in real estate, hotels and fashion.

In March this year, the The Savigny Luxury Index (SLI) rose further, as investors looked forward to the improvement of the industry in 2019, Savigny.

Our index has risen by 5.5%, while the Morgan Stanley Capital International Index (MSCI) is slightly higher than 2%.

Go up

This month, the agency's rating increase pushed the LVMH to the forefront of the stock growth list, an increase of nearly 9%.

The share price fluctuated slightly in the month, down nearly 9% in the opening period in March 25th, and then slowly recovered.

Traders said this could be a fat finger Oolong deal accident.

Moncler was immersed in the glory of the 2018 earnings report announced at the end of February, increasing by nearly 7% this month.

Eurazeo seized the opportunity to sell 4.8% of its holdings and ended its eight year investment relationship with the alliance, which brought 1 billion 400 million euros ($1 billion 600 million) and 4.8 times cash investment return to the fund.

Gliding downward

Despite the announcement of sales and profit growth in 2018 and the optimistic outlook for 2019, Brunello Cucinelli was well received in March.

The stock still has a premium of 42% compared to the average EBITDA multiplier of SLI, which means a very strong growth expectation - a drop of more than 10% in this month's share price, reflecting the challenges that must be met by unrealistic investor expectations.

Prada's market value shrank by more than 7% this month, due to its disappointing performance in 2018, showing the weakness of the Chinese market.

New look

Britain's euro continues to be a headache for both sides of the English Channel.

According to the time of the news, there will be no agreement in the UK when there will be no general election, nor will there be another referendum or all the above events.

A survey commissioned by Walpole, a luxury industry lobby, shows that the UK luxury industry is expected to lose $8 billion 900 million if there is no agreement to get rid of Europe.

Although it is clear that Britain and London are the main losers of this tragedy, the rise of nationalism throughout Europe and the rest of the world poses a major threat to the luxury industry, because the luxury goods industry has a truly global supply chain and consumer groups.

Author: Pierre Mallevays