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· Posted on
February 21, 2024

LVMH's success in China proves that there's no such thing as too many designer handbags post-lockdown

Despite expectations for a slower quarter, LVMH has reported a 17% increase in sales.

What's the key learning?

  • LVMH is still living the high life despite rising inflation and an overall rocky economy throughout 2023 - and the biggest contributor to this success is China.
  • China has been the world’s biggest market for luxury goods until Covid.
  • China’s young middle-class has accumulated wealth and acquired a taste for luxury fashion.

👉 Background: LVMH is the world’s biggest luxury company. They manage a total of 75 lux brands: Louis Vuitton, Dior, Tiffany’s, Bulgari, Fendi and many more.

👉 What happened: Despite expectations for a slower quarter, LVMH has reported a 17% increase in sales. And this shows that LVMH is still living the high life despite rising inflation and an overall rocky economy throughout 2023.

👉 What else: The biggest contributor to this success? China - who have just started to recover economically after finally opening up from their lockdowns.

What's the key learning?

💡China has been the world’s biggest market for luxury goods until Covid. But with the extended lockdowns in China, luxury sales dropped 10% year on year.

💡But China’s young middle-class has accumulated wealth and acquired a taste for luxury fashion. And with lockdowns over, LVMH’s performance is a strong indication of positive performance for other luxury brands too.

💡This mass uptick in LVMH’s recent sales might be a sneak peak of China’s post-Covid economic recovery.

‍

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