If the financial gains that luxury brands experienced in the last year are any indication, we may finally be digging our way out of this recession. After a dismal 2009 with modest gains and quite a few brands experiencing losses, this year’s top ten luxury brand list should have companies brimming with optimism for the future.
Millward Brown Optimor released its annual list of the World’s Most Powerful Brands this morning. (A little background: Millward Brown is part of WPP, a massive company that’s made up of a bunch of advertising firms, including Grey and Ogilvy & Mather. Optimor does brand analysis for many of these firms.)
We talked to Millward Brown vice president, Pierre Dupreelle, and his colleague Daniella Segal, who is a senior consultant at the firm, to get their take on the state of the luxury market. This year the category is up 19% as a whole, almost back to pre-recession levels.
There was some shifting of rank order in the latter half of this year’s list compared to last year, but with the exception of two companies, all made pretty stellar gains. The three big reasons for this? Asia’s appetite for luxury, a commitment to heritage, and the savvy use of digital media. Luxury brands had been wary of the digital realm for fear that it would dilute their exclusivity, but many successfully made the foray into digital marketing this year. Chanel and Burberry (new to the list this year) both did it in innovative ways while maintaining their status.
Scroll through to see the top ten luxury brands this year and why they deserve to be there:
1. Louis Vuitton
Last year’s ranking: 1
Overall Brand Value: Up 23% to $24.312 billion
Vuitton’s continued focus on its heritage combined with huge popularity in Asia keep this luxury behemoth at the top of the list. Valued at more than twice the amount of its next nearest competitor, no one can touch those LV’s.
Last year’s ranking: 2
Overall Brand Value: Up 41% to $11.917 billion
Hermès has obviously been the focus of much of the luxury world this year with LVMH’s seemingly predatory interest in the company. That drama aside, it holds steadfast in its commitment to the brand’s heritage of craftsmanship, and is focusing heavily on Asia, as are most luxury brands.
Last year’s ranking: 3
Overall Brand Value: Down 2% to $7.449 billion
The brand’s momentum has decreased a bit this year--but a 2% dip isn’t very significant. They were one of the first brands to enter the online arena and they’ve led the way for other brands. And Frida Giannini’s hitting her stride from a design perspective, if this season’s Gucci cover presence is any indication; the brand should stay strong over the next few years.
Last year’s ranking: 4
Overall Brand Value: Up 23% to $6.823 billion
Dupreelle thought this was one of the most interesting stories of the year. After an 11% decrease in value last year, Chanel came roaring back. While they were one of the last online hold-outs, when Chanel did take it digital they set the bar high for luxury brands in the future. They are very careful about how they sell (you won’t find a Chanel bag online), and have managed to keep the exclusivity of the brand intact while having a strong digital platform.
Last year’s ranking: 8
Overall Brand Value: Up 34% to $5.327 billion
2009 was a really bad year for luxury jewelry; it was the most impacted category within luxury, and Cartier posted a 19% loss on last year’s list. However, jewelry’s making a very strong comeback. (Tiffany & Co, which was on last year’s list, fell off the list this year only because they haven’t increased as much as other brands.) Again, the renewed interest in luxury goods can be traced directly to Asia and its voracious appetite for bling.
Last year’s ranking: 6
Overall Brand Value: Up 11% to $5.269 billion
Same rationale as Cartier---it’s bouncing back from a 14% loss last year.
Last year’s ranking: 5
Overall Brand Value: Down 7% to $4.997 billion
Hennessy showed a small 1% decrease last year, too, but it’s still the most popular cognac brand in China.
8. Moët & Chandon
Last year’s ranking: 7
Overall Brand Value: Up 7% to $4.570 billion
People obviously are celebrating more this year, because last year the world’s most popular champagne was down 12%.
Last year’s ranking: 9
Overall Brand Value: Up 7% to $3.422 billion
We asked why this brand does so well when it seems to be quite a sleepy brand in the US and Europe. The answer? You guessed it--Asia.
Last year’s ranking: Unranked
Overall Brand Value: Up 86%
This is the first time Burberry has made the top ten list. Dupreelle noted that Burberry has been revamping the brand and have taken a lot of online risks that have paid off. For several seasons now, they’ve been selling looks off the runway immediately after the shows wrap. While the brand took a lot of criticism about this--some critics thought the design process became more watered down--it’s obviously worked for them. The brand has also managed to be true to its heritage while modernizing. They've also increased their price points a bit.