At Present, Luxury Brands Are Adapting To The "New Reality" Through Various Means.

According to the world clothing shoes and hats net, Savigny

The The Savigny Luxury index (SLI) rose 2%, and the Morgan Stanley Global Index (MSCI World Index) was 2.6% higher.

The main reason is that the market has optimistic optimism about China's development prospects and the adaptability of luxury goods industry to new realities.

Big news

In the critical period between Christmas and the Chinese Lunar New Year, optimism returns to mainland China.

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Driven by the depreciation of the renminbi and the Chinese government's drive to encourage growth through consumption rather than infrastructure investment and the shrinking price gap between the mainland and overseas, the Chinese affluent class began to consume at home again.

Bain consulting (Bain & Co.) estimated that sales of luxury goods in mainland China increased by 4% in 2016 after three years of decline.

The company's performance can also confirm the forecast, and Burberry, Tiffany, Herm s and the latest financial results of the Richemont group have shown growth in mainland China.

The peak group recorded the "obvious" sales growth of mainland China in October last year.

After the observation and study in 2016, luxury brands are adapting themselves to the "new reality" by tailoring products and providing more affordable prices according to local demand, with a view to encouraging the middle class (the key group in emerging markets such as China) to spend with the "millennial generation".

Louis Vuitton and other brands provide products with more small leather products and fragrance products. Cartier's latest watch products are launched directly on stainless steel instead of the precious metal watches that were launched in the past, followed by the introduction of stainless steel styles.

Other watches brand is the same: Tag Heuer successfully re organized around the core price point, sales in 2016 increased by 10%; PERREGAUX Perregaux (Girard Perregaux), in order to better serve customers at all sales points, reduced the number of sales outlets from 500 to around 400, the brand entered the 5000 to 10000 Swiss Franc price range through the introduction of strong performance products.

The acquisition business was quite active in December, mainly concentrated in jewelry.

In the field of personal care, Italy is standing at the forefront of such M & A activities: Gansu Gangtai, a Chinese enterprise group active in jewelry acquisition activities, acquired the Buccellati 85% shares of legendary Italy jewellers from the Clessidra and Buccellati families, and the brand valuation was about 270 million euros; Italy's local private equity fund Armonia bought 50 million of the majority of the share of the casual wear brand Aspesi, and Italy's mid end retailer WP Lavori acquired the brand of outdoor clothing Gangtai.

In other parts of the world, Berkshire Partners, the US private equity fund, acquired several shares of the Kendra Scott of the luxury jewellery brand (undisclosed amount), valued at about $1 billion, and Unilever (Unilever) acquired the high-end hair care brand Living Proof; the French perfume group Jacques Bogart acquired the German flavor chain HC Parf Proof; the former Porsche design director and the fashion entrepreneur, after consulting with an undisclosed bidder, acquired one of the few German fashion brands that were internationally successful and bankrupt.

Go up

After the result of the constitutional amendment referendum and the consequent prime minister's fall, Italy's luxury industry shares rose: in the Tod 's market, stocks rose 14% in December, Brunello Cucinelli rose 13%, Ferragamo was 10%, Moncler was 8%.

Ratings agencies have raised their comments after Swatch group (Swatch) and LVMH gained 6% gains in December.

Gliding downward

The US luxury goods market underwent a series of "flip ups" after Trump's election last month, and most of the stock prices fell almost the same as before the election.

Prior to the announcement of the company's breakfast will be longer than expected, the Ralph Lauren stock market suffered a heavy loss, down 14%; Michael Kors and Tiffany fell by 8% and 6% respectively.

Est, e Lauder, Coach and other U. S. stocks have declined in unit numbers.

New look

It may take some time for the US luxury market to get out of the weak, largely because of the data reached last Christmas.

For the luxury goods industry, the good side is that Trump plans to slash taxes for the rich and release more disposable income. On the contrary, US Department stores are still struggling, and luxury brands must reduce exposure to the market segment in order to control revenue losses.

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