Demand for limited-edition handbags emblazoned with the logo helped drive a better-than-expected quarterly gain at owner LVMH Moet Hennessy Louis Vuitton SA’s fashion and leather-goods unit. Sales were “sharply up” in January, the world’s largest luxury-goods maker said yesterday, helping send Paris-based LVMH’s shares today to a 16-year high.
“A lot of investors we talk to still have the perception that the monogram is an issue. It’s not,” said Melanie Flouquet, an analyst at JP Morgan Cazenove. Nurtured well with product releases, the company’s logo is “a key brand differentiator.”
For the limited-edition line of bags marking Vuitton’s 160th anniversary, Creative Director Nicolas Ghesquiere and executive vice president Delphine Arnault invited six “iconoclasts” to interpret the LV monogram. Introduced in the fall, a case designed by photographer Cindy Sherman costing 130,000 euros ($149,000), sold out in a fortnight, LVMH said. The “Studio in a Trunk” was decorated with silk-screened patches and filled with a vanity case and colorful, pull-out drawers.
“Our objective with Vuitton as with many other brands is to increase the desirability of our products,” LVMH Chairman and Chief Executive Officer Bernard Arnault said at a presentation in Paris yesterday. The monogram fabric needs “to evolve from time to time.”
LVMH said in January 2013 it would introduce more leather goods and fewer logoed products after reporting no improvement in the pace of sales growth at its fashion and leather-goods unit. The measures, which also included slowing retail expansion and upgrading stores, were a response to concern that consumers, particularly in Asia, were tiring of Vuitton’s monogrammed bags.
Vuitton rival Gucci, owned by Kering SA, has also limited the use of its trademark double G logo, as did other brands as they sought to boost their cachet with the wealthiest shoppers. That led to homogeneity in the handbag category, according to Flouquet,
Handbags “had gone too consensual, in our view, across most brands with plain-colored leather offers,” Flouquet said. “The logo is dead, long live the logo.”
By: Andrew Roberts; editors: Celeste Perri and Robert Valpuesta.