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And while the past year has been challenging, this strategy is paying off, according to Jasper Brodin, CEO of Ikea's parent company, Ingka Group. "People have the same needs, but they have much less money in their wallet," he added. AdvertisementHowever, Ikea has benefited from investing in low prices because it has attracted more shoppers away from pricier rivals. AdvertisementBecause of this, he said that Ikea customers are largely engaging in needs-based shopping, picking up the necessities first, like a new bed or kitchen table, instead of non-essential items. "There is a large stimulus package coming from the government right now, which is helping, but people have been holding on to their money," Brodin said.
Persons: Jasper Brodin, — Brodin, , Nora Redmond, lockdowns, Brodin Organizations: Ikea, Ingka, Oxford, Starbucks Locations: London, China
AdvertisementChina's KFC and Pizza Hut CEO said that she sits and watches her customers eat. Joey Wat, the head of KFC and Pizza Hut in China, has an unusual approach to designing new products: She sits in restaurants for hours, watching her customers eat. Wat is the CEO of Yum China, the company that owns KFC, Taco Bell, Pizza Hut, and other fast-food brands in the country. According to Yum China, KFC is China's most popular fast-food chain, with over 11,000 outlets in the country. Representatives of Yum China didn't respond to a request for comment from Business Insider.
Persons: Jason Buechel, LVMH's Bernard Arnault, Joey Wat, Wat, Fortune, Sam Walton, Laxman Narasimhan, foodie, Buechel, Bernard Arnault, Celine, Louis Vuitton, Christian Dior, Alexandre Arnault Organizations: Pizza, KFC, Yum, Taco Bell, Global, New York City, Walmart, Starbucks, Foods, Tiffany, Bloomberg, Business Locations: China, Yum China, New York, Austin
AdvertisementIndependent luxury brands face pressure to sell or seek investment amid the market downturn. It's a decision some independent luxury brands are confronting amid an industry-wide downturn. Even the biggest and most successful independent brands with cult followings are under pressure. Seize the moment or risk failureEscribano said there's been an uptick of independent brands seeking investors as a survival strategy. For independent brands, Escribano said, the thought process is "either we make it today or we're not here tomorrow."
Persons: It's, Simon Porte Jacquemus, Figaro, Gigi Hadid, Stephane Cardinale, Corbis, Jacqumeus, Blanca Zugaza Escribano, Escribano, there's, Kate Middleton, Dion Lee, Taylor Swift, Mara Hoffman, Roksanda, Chris Jackson, Milton Pedraza, Le Figaro, Jaquemus, Montaigne, Pedraza, Jacquemus, Kering, Valentino, Marc Piasecki Organizations: Fashion, Business, The Brand Group, Luxury Institute, Olympics, Burberry, Brands Locations: Soho , New York City, French, Serbian, Paris
But now it appears that some luxury brands have forgotten that aim. Dukas/Getty ImagesRay of Buttermilk said that some luxury brands have been hesitant to explore collaborations as a means of engaging Gen Z consumers because they fear losing their luxury allure. The future is vintageLuxury players might be kicking themselves for alienating Gen Z consumers, but Gen Zers never forgot about luxury. But secondhand's success isn't bad news for primary luxury brands, Escribano said. Bar certain luxury products like Hermès Birkins handbags, secondhand luxury is by and large cheaper and retains a level of exclusivity, she said.
Persons: Bain, Louis Vuitton, Z, Gen Z, There's, Claudia D'Arpizio, Blanca Zugaza Escribano, Gen, D'Arpizio, LVMH, Prada, Sabrina Carpenter, Marleen Moise, Getty, Jamie Ray, Escribano, Gen Z's, Thomaï, They've, Gen Zers, Z's Organizations: Louis, Prada, Bain & Company, Industry, Bain, Business, NYU's Stern School, Gen Locations: Hermès
Bernard, CEO and chairman of LVMH, is the world's richest person with a $158.5 billion net worth. Related Video 5 ways Elon Musk shook up Twitter as CEOAlexandre Arnault and Bernard Arnault in 2016. Representatives for LVMH, Arnault, and Guiony did not respond to requests for comment from Business Insider. The new appointments also drum up speculation about who will succeed Bernard as LVMH's CEO. The Arnault family has been compared to the Roy family, the subjects of the HBO drama, "Succession."
Persons: Alexandre Arnault, Moët Hennessy, Bernard Arnault's, , Bernard Arnault's multibillion, LVMH, Bernard, Christian Dior, Bernard's, Alexandre, Elon Musk, Bernard Arnault, Donato Sardella, Louis Vuitton, Jean, Jacques Guiony, Guiony, — Alexandre, Frédéric —, Delphine Arnault, Dior Couture, Antoine Arnault, Antoine, Jean Arnault, Roy, Roy family's Organizations: Service, company's Sustainability, LVMH's, Product, Communications, Tiffany, LVMH, Business, Reuters, Christian Dior, HBO, New York Times Locations: LVMH
LVMH-owned luxury hospitality company Belmond will launch a luxury sleeper train next year that will take travelers through the countryside of England and Wales. The Britannic Explorer will run three itineraries: one to the southwestern county of Cornwall and the other to the opposite end of England through the Lake District of Cumbria in the north, while the third will journey though the country of Wales. All trips will start from London and run for three nights, with the England routes operating during the weekends (Fridays to Mondays) and the Wales route during the week (Monday to Thursday), allowing travelers to combine two journeys into one trip. Belmond operates several luxury hotels around the globe, including the famed Venice Simplon-Orient-Express and Asia's Eastern & Oriental Express.
Organizations: Belmond, Orient, Oriental Express Locations: England, Wales, Cornwall, Lake District, Cumbria, London, Venice
Classic luxury, which Ralph Lauren encapsulates, is resonating with Chinese consumers. "I've said it before but it bears repeating in a volatile environment, Ralph Lauren is firmly on offense," Patrice Louvet, the CEO of Ralph Lauren, said on a conference call with analysts on Thursday. Ralph Lauren classics like Polo shirts and cable-knit sweaters are a hit with Chinese consumers. Ralph Lauren targets Chinese consumers in six key cities and on local Chinese social media platforms. Sebastian Ng/SOPA Images/LightRocket via Getty ImagesWith its brick-and-mortar stores, Ralph Lauren has prospered by doing more with less.
Persons: Ralph Lauren, , Ralph Lauren's, I've, Patrice Louvet, Xi Jinping's, Neil Saunders, Edward Berthelot, Martin, Louvet, Ralph Lauren doesn't, Zers, Sebastian Ng, Olivia Plotnick, Roll, Donald Trump's, It's Organizations: Service, New, GlobalData, McKinsey, Getty, Wai, China Locations: Asia, China, New York City, China China, Tokyo, Seoul, Shanghai, Milan, China —, Beijing, Chengdu
Luxury brands face uncertainty after Donald Trump won the US presidential election. His victory spells trouble for the sector's hopes of a comeback in China. AdvertisementAmerica has elected a new president, paving an uncertain future for luxury brands looking to boost sales in China. Tariffs further complicate luxury's China issuesChina has been a reliable cash cow for luxury brands for decades. AdvertisementNationalism's rise doesn't play well for luxuryTrump's return to the White House is a signal of a wider issue facing luxury brands — rising nationalism.
Persons: Donald Trump, , Trump, Jelena Sokolova, Martin Roll, they'll, Cheng Xin, Gary Ng, Ng, Daniel Langer, Justin Sullivan, It's Organizations: Service, America, Beijing, Morningstar, Trump, McKinsey, Pepperdine University Locations: China, outflows, Russia, Europe
Two crypto moguls' joint wealth rose by about $15 billion on the back of Trump's election victory. Binance's Chaopeng Zhao and Coinbase CEO Brian Armstrong added about $12 billion and $2.6 billion each. AdvertisementTwo cryptocurrency tycoons saw a near-$15 billion boost to their combined wealth on Wednesday as Donald Trump won the presidential election. One result was the world's 12 richest people grew more than $70 billion richer in a single day, per Bloomberg's wealth rankings. Exclude him and his 11 peers have grown a combined $505 billion richer this year — a figure that exceeds the market value of Oracle ($502 billion).
Persons: Binance's Chaopeng Zhao, Brian Armstrong, , Donald Trump, Changpeng Zhao, Zhao, Elon, Binance, Elon Musk, Anthony Harvey, Kamala Harris, Musk, Larry Ellison, Berkshire Hathaway's Warren Buffett, Jeff Bezos, Bernard Arnault Organizations: Service, Bloomberg, Trump, Ethereum, Republican, Democratic, Oracle Locations: Solana, Berkshire
China's luxury slump is spreading to more consumer brands. Companies like Starbucks, Estée Lauder, and Nike have reported falling sales in the region. It's hitting Western brands particularly hard, as reflected by companies across the consumer sector reporting muted sales in China in the most recent quarter. Consumer spending in China never fully recovered after the government started lifting COVID-19 curbs in late 2022. AdvertisementAdidas managed to buck the trend, reporting sales up 9% in Greater China in the third quarter.
Persons: Estée Lauder, , China's, MingYii Lai, Brian Niccol, L'Oréal, Lynn Song Organizations: Companies, Starbucks, Nike, Service, Burberry, Daxue Consulting, InBev, Carlsberg, Apple, Adidas, Heineken, Greater China, ING Locations: China, Beijing, Greater China, Greater
Tingshu Wang | ReutersFrom Apple to Starbucks , U.S. consumer brands are reporting yet another quarter of China sales declines. Apple last week reported Greater China sales fell slightly to $15.03 billion in the three months ended Sept. 28, down from $15.08 billion in the year-ago period. The quarterly sales decline reduced Apple's China revenue share to 15.8% of total net sales, down from 16.9% in the year-ago period. Low consumer confidenceU.S. sportswear giant Nike said that Greater China revenue for the quarter ended Aug. 31 fell by 4% year-on-year to $1.67 billion. In Europe, luxury giant LVMH also felt the drag from the China market.
Persons: Tingshu Wang, Tim Cook, Apple, Brian Niccol, Niccol, Matthew Friend, Jean, Jacques Guiony, Isaac Stone Fish, Cummins, Walt, Fish Organizations: Reuters, Apple, U.S, Starbucks, Nike, Carrier, Coca Cola, RTX Corporation, Honeywell, Walt Disney, Caterpillar Locations: Chengdu, Sichuan province, China, U.S, what's, Hong Kong, Macao, Taiwan, Greater China, Europe, Asia, Japan, COVID, Japan Asia
People vote at the San Francisco City Hall voting center on the final day of early voting ahead of Election Day, on November 4, 2024 in San Francisco, California. This report is from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. U.S. markets mostly gain after electionsHistorically, stocks have mostly risen after a presidential election, though there can be some short-term volatility. The three major U.S. benchmarks on average have almost always clocked gains between Election Day and year-end, going back to 1980, according to CNBC data.
Persons: Stocks, Tesla Organizations: San Francisco City Hall, CNBC, Dow Jones, Nasdaq, China's CSI, Apple, Starbucks, Nike, Adidas, U.S, Conference Board Locations: San Francisco , California, U.S, Asia, Pacific, China, Poor China
Luxury sales in Japan surged due to a weakened yen and increased tourist spending. Brands like Hermès are thriving there by aligning with Japanese values of subtlety and quality. Rasmus Jurkatam/Getty ImagesBut in Q3, both LVMH and Kering reported a slowdown in luxury spending in Japan. Still, while the tourist spending may have faded somewhat, experts say Japanese consumers are emerging from a frugal era and spending on luxury themselves. But the Japanese aren't just splashing their cash anywhere — a bitter pill for some luxury brands to swallow.
Persons: , Amrita Banta, Kering, Rasmus Jurkatam, Jelena Sokolova, Daniel Langer, Martin Roll, Birkin, Banta, Louis Vuitton, Roll, Langer, " Langer Organizations: Brands, Service, Research, Gucci, Morningstar, Pepperdine University, McKinsey, Prada Locations: Japan, China, India
White sand, clear turquoise sea and lush trees swaying in the breeze. This might sound like a description of the Maldives — but it's actually what I experienced on a recent trip to Italy. The area was founded by Prince Karim Aga Khan IV in the 1960s and now attracts the jet set. Airfare obviously affects travel costs, but I spent $1,500 for a week on the island, including flights from London. We stopped for a lemon granita at the Shardana restaurant, set among the trees overlooking the white sand Baia Sant'Anna beach.
Persons: Costa Smeralda, Prince Karim Aga Khan IV, Emanuele Perrone, Belmond, Blanc, Rocco Forte, Neilson, Costa, I'd, Baia, Sinead, Lucy Handley's, Keener, Lucy Handley, Pedra Niedda, Paolo, Ristorante La Volpe, Enrico Spanu Organizations: Porto Cervo, Qatar Investment Authority, Getty, Schools, London Stansted Airport, Ristorante Locations: Maldives, Italy, Sardinia, Sicily, Europe, Porto, Sardinia's Costa Smeralda, London, U.K, Greece, Baia dei, Olbia, Isola Tavolara, Tanaunella, Sardinian, Orosei
This was largely due to the success of its sister brand, Miu Miu. AdvertisementPrada Group is defying the luxury slowdown thanks to its Miu Miu brand. Miu Miu products, like its micro skirt, have a cult following among Gen Z consumers. Related stories"Likewise, Miu Miu would probably not be experiencing this type of growth today if it hadn't been part of a larger group," Bonini added. In a note to clients on Wednesday, Bernstein analyst Luca Solca said that the brand's current trajectory "confirms our view that the market is underappreciating the growth that Miu Miu can generate in the next 12 to 18 months."
Persons: Miu Miu, , Kering, Miuccia Prada, Emily Ratajkowski, Hunter Schafer, Hailey Bieber, Blanca Zugaza Escribano, execs, Andrea Guerra, Prada, Andrea Bonini, Miu, Bonini, Bernstein, Luca Solca Organizations: Prada, Service, Hermès Locations: China
How Hermès is bucking the global luxury slowdown
  + stars: | 2024-10-31 | by ( Natalie Rice | ) www.cnbc.com   time to read: +2 min
French luxury company Hermès has spent nearly 200 years emphasizing quality, scarcity and desirability — a strategy that's helped it dominate the luxury sector, even over its much larger rivals. Analysts say the Birkin and the Kelly account for between 25% and 28% of Hermès' total revenue. For fiscal year 2023 Hermès reported the fourth-highest revenue total of the major luxury fashion brands, behind LVMH , Richemont and Kering . In its most recent quarter, Hermès posted double-digit revenue growth while competitors LVMH and Kering reported sharper-than-expected declines in sales. Globally, many luxury consumers have pulled back on spending, particularly aspirational buyers in 2023 and 2024.
Persons: Hermès, Birkin, Kelly handbags —, Jane Birkin, Princess Grace Kelly of Monaco, Kelly, Luca Solca Organizations: Bernstein Locations: LVMH
Gucci had a challenging third quarter partly due to its Asia Pacific slump, per Kering's latest earnings call. AdvertisementGucci just had a bad quarter, and Kering is attributing the lackluster performance to a slump in its Asia Pacific market. According to a third-quarter revenue infographic by Kering, sales in the Asia Pacific region were down 38% compared to the previous year. According to Kering, Gucci saw a 7% increase in sales in Japan in the third quarter compared to the start of 2024. AdvertisementApart from Gucci, Kering's other brand, Yves Saint Laurent, also suffered a loss.
Persons: Gucci, It's, , Henri Pinault, James Grzinic, LVMH, Kering, Amrita Banta, Yves Saint Laurent, Stefano Cantino, Cantino Organizations: Service, Gucci, RBC, Reuters, mojo, Jefferies, Research, Strategy, Business Insider Locations: Asia, China, Asia Pacific, Japan, Europe
The French fashion house is bucking the trend of the luxury industry as competitors like LVMH stutter. Hermès is succeeding while peers struggle because it follows the law of luxury to a tee, analysts say. AdvertisementIf the luxury slump is an epidemic, Hermès is managing to stay immune. The fashion house is reaping the rewards of a long-term strategy and abiding by the fundamental laws of luxury. AdvertisementIn the luxury fashion world, there's a growing belief that "getting attention is everything," Pedraza said.
Persons: Hermès, , LVMH, Kering, Hermès Birkin, Sarah Jacobs, Carole Dupont, Eric du Halgouët, Pietri, Martin, Roll, Milton Pedraza, Pedraza, Hermés Organizations: Service, New York Loan, Business, Investor Relations, Hermès, Finance, McKinsey, Paris Thomson Reuters, Luxury Institute Locations: Asia, Japan, China, Switzerland, Paris, LVMH
New York low-key women's fashion brand Veronica Beard just launched a collaboration with the NFL. On Sunday, the NFL announced a partnership with Veronica Beard, a low-key luxury fashion brand in New York founded in 2010 by sisters-in-law Veronica Miele Beard and Veronica Swanson Beard. AdvertisementMany luxury brands are increasingly courting sports fans as an untapped source of revenue. The luxury fashion industry can't rely on sports to be its saving grace long-termHowever, Pedraza said, not all collaborations reap big rewards. "There's a bit of a lack of innovation on the part of some luxury brands," he said.
Persons: Veronica Beard, , Veronica Miele Beard, Veronica Swanson Beard, Veronica, Dickey Jackets, Renie Anderson, Taylor Swift, Serdari, Swift, LVMH, Bernard Arnault's, Red Bull, Louis Vuitton, Bernard Arnault, Victor Boyko, Milton Pedraza, Pedraza, — Gen Zers, millennials —, they're, Mary Organizations: NFL, Service, Business, NYU's Stern School, Formula, Bloomberg, Paris FC football, Red, Paris Olympics, NBC, Luxury Institute Locations: York, New York
The country's economy is slowing down, and some shoppers are rethinking their luxury purchases. AdvertisementChina, with its sheer population size and once-meteoric economic growth, has been heralded as a reliable cash cow of luxury brands for decades. But the golden days of luxury shopping in China seem to be fading for many luxury brands — though there are exceptions. In 2021, the Asia region, excluding Japan, was responsible for 35% of LVMH's total revenue. It's a similar story at other luxury brands.
Persons: , LVMH, Kering, Hugo Boss, Burberry Organizations: Service, Gucci, Swatch Locations: China, Asia, Japan, Pacific
Luxury stocks may be a risky China stimulus bet
  + stars: | 2024-10-19 | by ( Hakyung Kim | In Hakyungkim | ) www.cnbc.com   time to read: +7 min
A post-pandemic spending surge led to luxury stocks such as LVMH to reach all-time highs in early 2023, but that soon changed. We believe improved confidence and sentiment is required to reach even our flat year-over-year Chinese luxury growth forecast for 2025," Wallace noted. Luxury stocks are feeling the pressure — year to date, U.S.-traded shares of major players LVMH and Kering are down about 17% and 41%, respectively. Analysts and investors are mixed as to whether the Chinese stimulus measures can revive luxury spending growth among consumers — and whether it will create a meaningful tailwind for luxury companies. Whether the luxury sector can continue growing at the same levels without as much Chinese consumer spending remains in question.
Persons: — stoking, Ben Harburg, Morgan Stanley, Ashley Wallace, Wallace, Jean, Jacques Guiony, Moncler, Hermes, Prada, Richemont, LVMUY CFRUY, , Edouard Aubin, Sauron, Harburg, LVMH's Guiony, we've Organizations: Alpha, Bank of America, of America, Consumers Locations: China, Covid, 3Q24, U.S, LVMH
download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . LVMH, the largest of the luxury conglomerates, announced its third-quarter earnings this week, and the results were grim. AdvertisementWhile personal luxury sales in China grew by more than 37% each year from 2019 through 2021, that annual growth is not expected to hit more than 4.2% through 2028, according to EMARKETER data. AdvertisementEMARKETER's Canaves pointed to the collaborations and moves toward streetwear that helped some brands emerge from the last luxury slump. Of course, any expansion into new categories should not take attention from handbags and clothing, the revenue drivers of luxury brands.
Persons: LVMH, , Louis Vuitton, Salvatore Ferragamo, Goldman Sachs, Gucci, Hermès, Jean, Jacques Guiony, Adam Cochrane, Chanel, Canaves, Guiony, Birkin, Deutsche Bank's Cochrane, Cartier, Brunello Cucinelli, Rambourg, Louis Organizations: Service, Revenue, Louis, Burberry, Business, Deutsche Bank, Gucci, Deutsche Bank's, Chez Locations: China, Asia, Japan, COVID, streetwear, Paris
Aris Yeager shot to fame by parodying a spoiled, rich European caricature on social media. Yeager recently told Business Insider about his online persona. You may have seen the 24-year-old Belgian-American, better known as "The European Kid," at some point on your social media feeds. But the conflation between Yeager's and Louis' life goes further than being mistaken for billionaires' sons. "I could be a Formula 1 driver," Louis told Sainz in a video earlier this year.
Persons: Aris Yeager, Yeager, , Louis, Fabrizio Brienza, Bernard Arnault, Louis Vuitton, Alexandre Arnault, Yeager's, Moritz, he's, Carlos Sainz Jr, Anne Hathaway, Shaun White, Sainz, I'm, Philip Davis, Lefty, Storytime, Thomas Repelski, Davis Organizations: Service, New York City, Dior, TF1, Google, Hamptons, Northeastern University, Milano Locations: New York, Europe, TikTok, French, Saint, St
Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . In today's big story, Netflix's earnings report comes as Wall Street wonders if the king of streaming can keep its crown . Business Insider's Lucia Moses outlined investors' key questions about Netflix ahead of its third-quarter earnings call this afternoon. The NFL is coming to the streamer this Christmas, with Netflix showing two games on the holiday.
Persons: , Leapmoter, Chelsea Jia Feng, Business Insider's Lucia Moses, Alain Tascan, Jamie Squire, — Peacock, BI's Peter Kafka, There's, Patrick Mahomes, Lamar Jackson, Mike Kemp, Louis Vuitton, Christian Dior, iStock, Rebecca Zisser, Harris, Elon Musk's, Elon, Tyler Le, it's, Amy Powell, El, Dan DeFrancesco, Jordan Parker Erb, Hallam Bullock, Milan Sehmbi, Amanda Yen Organizations: Business, Service, EV, Netflix, Epic Games, NFL, NBA, Getty, Louis, BI, Trump, House, SpaceX, Elon Musk's, California Coastal Commission, Paramount, NATO Locations: Europe, Swedish, California, Hollywood, El Mayo, Sinaloa, New York, London
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailMercedes F1 Team CEO Toto Wolff on the business of F1, success in the U.S. and growth outlookToto Wolff, Mercedes-AMG Petronas F1 Team team principal and CEO, joins 'Squawk Box' to discuss the business of F1, success of F1 in the U.S., partnership with LVMH and other brands, long-term growth outlook, and more.
Persons: Toto Wolff, Mercedes, LVMH Organizations: Petronas F1 Team Locations: U.S
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