Economic weakness in key markets dims luxury sales of the top 10 most valuable global luxury brands of the year, says brand analyst company Millward Brown in its 10th Annual Brandz Top 100 Most Valuable Global Brands Ranking released this week.
Of the 13 categories tracked in the BrandZ Top 100 Most Valuable Global Brands 2015, luxury declined most in Brand Value, with a 6 percent drop compared with a 16 percent rise a year ago.
Following a strong recovery from the global financial crisis, the pace of sales flattened for several reasons, including the economic slowdown in China, Brazil and Russia. In addition, China’s anti-corruption regulations trimmed luxury gift giving in that country.
Changing values and attitudes about consumption also impacted luxury brands. Some consumers, particularly millennials, viewed luxury products as expensive indulgences inconsistent with their desire to live in a modest and sustainable way.
In addition, luxury brands limited efforts to reach a mass audience and instead reaffirmed exclusivity as a vital characteristic of luxury.
Instead of offering trinkets at entry-level price points to widen accessibility, brands relied on content, such as live streaming fashion shows, to introduce new customers to the brand experience.
This resurgence of exclusivity created an opportunity for more ubiquitous andpopularly priced luxury brands like Michael Kors. Sold both at its own locations and in department stores in over 85 countries, Michael Kors entered the BrandZ Luxury Top 10 for the first time this year.
Meanwhile, new luxury markets emerged – in Mexico, Turkey and Nigeria, for example.And brands also targeted the large and fast-growing demographic made up of international travelers who purchase luxury at airport shops.
The slowdown of the Chinese economy especially impacted Prada. With one-third of its sales coming from the Asia-Pacific region, Prada’s annual profits and brandvalue dropped. Both Louis Vuitton and Gucci, which expanded rapidly in China,were impacted by the economic slowdown and the anti-corruption regulations that dampened official gift giving.
Top 10 most valuable global luxury brands of 2015:
1. Louis Vuitton: Brand Value 2015 $M – 27,445 Brand contribution: 5; Brand Value Change % 2015 vs 2014: 6%;
2. Hermès Brand Value 2015 $M 18,938; Brand contribution: 5; Brand Value Change % 2015 vs 2014: -13%;
3. Gucci Brand Value 2015 $M 13,800; Brand contribution: 5; Brand Value Change % 2015 vs 2014: -14%;
4. Chanel Brand Value 2015 $M 8,987; Brand contribution: 5; Brand Value Change % 2015 vs 2014: 15%;
5. Rolex Brand Value 2015 $M 8,532; Brand contribution: 5; Brand Value Change % 2015 vs 2014: -6%;
6. Cartier Brand Value 2015 $M 7,612; Brand contribution: 4; Brand Value Change % 2015 vs 2014: -15%;
7. Prada Brand Value 2015 $M 6,540; Brand contribution: 5; Brand Value Change % 2015 vs 2014: -35%;
8. Burberry Brand Value 2015 $M 5,722; Brand contribution: 5; Brand Value Change % 2015 vs 2014: -4%;
9. Michael Kors Brand Value 2015 $M Kors 3,815; Brand contribution: 3; Brand Value Change % 2015 vs 2014: N/A;
10.Tiffany Brand Value 2015 $M 3,232; Brand contribution: 3; Brand Value Change % 2015 vs 2014: N/A.
