Map of brands in luxury fashion, LVMH (pt. 3)

Fashion, News and commentaries

For the 3rd in this series of posts regarding brands ownership in luxury fashion, I’m dedicating the whole page for the behemoth conglomerate Louis Vuitton Moet Hennesy (LVMH) Group. As usual, I organized the brands based on how the parent company treats them. In this case, LVMH organizes the business groups as the following (percentages refer to revenue share based on 2013 Annual Report):

  • Fashion & Leather Goods – 34%
  • Selective Retailing and Other Activities –  29% combined
  • Wines & Spirits – 14%
  • Perfumes & Cosmetics – 13%
  • Watches & Jewelry – 10%

LVMH has a 23.1% stake in Hermés and the company does not expressly include more information than that in its annual report. Furthermore, the group also has a private equity arm that is not mentioned in the annual report. L Capital Asia, as the name implies, is focused on brands in Asia and the Pacific – China, India, Taiwan, Singapore, Australia.

brands_map_lvmh

In most of the brands in each business group, LVMH has a 100% ownership and almost always a majority stake. The following are some notable exceptions and also interesting facts on LVMH acquisitions:

What I found the most interesting is how Dior is incorporated into the brand. LVMH includes Dior Parfums and Dior Watches within its portfolio but not the Dior ready-to-wear and couture. Technically, Christian Dior owns a minority stake in LVMH and this is quite an oversimplification of the labyrinthine ownership of Dior and LVMH shares by the Arnault family. See below for a visual representation culled from different sources. There’s a lot of history to how this structure came to be and I will devote a completely different post on it because it will require a lot more research, some of them involves public documents in French. Even Forbes is struggling to make sense of it.

Screen Shot 2014-08-21 at 2.52.03 PM

Weekly roundup in tech and retail

News and commentaries

Here’s the most relevant news this week in tech and retail.

In Tech:

  1. A massive 2-year security flaw in OpenSSL, Heartbleed, was discovered April 7 and affected companies scramble to patch it up – from websites to routers
  2. Google news. Google Glass will be available to anyone in the US for 1 day only on April 15 at 6 AM ET, sign up here for the reminder; Google can now continuously scan apps for Android users to protect against malicious code
  3. Dropbox news. Dropbox announces: Project Harmony, which allows for collaboration for Microsoft Office files; Mailbox for Android; and Carousel, an app for photo/video archiving and sharing
  4. Amazon news. Amazon introduces Dash device for scanning and adding items to Amazon Fresh shopping list; Amazon acquires Comixology, a cloud-based digital comics platform
  5. Twitter acquires Cover, an Android lock screen app, which displays apps on an Android lock screen based on context and historical use

In Retail:

  1. LVMH  shares surge Thursday as company reports 9% rise in Q1 2014 like-for-like sales of its fashion and leather goods, Louis Vuitton – a good sign for Nicolas Ghesquire’s appointment as artistic director
  2. After closing its stores in February, Loehmann’s is set to come back online in May
  3. Calvin Klein owner PVH invests in Karl Lagerfeld – the minority investment will allow the company to have the “right of first offer to license the brand in North America
  4. Social shopping app, The Hunt, raises $10M in Series B funding led by Khosla Ventures
  5. Kering, owner of Gucci may acquire lifestyle and sports brands within 3 years as it assesses its Puma brand

Nicolas Ghesquière’s debut at Louis Vuitton

News and commentaries

As Paris Fashion Week starts, one of the most anticipated showings (for me, anyway) is Nicolas Ghesquière’s collection for Louis Vuitton on March 5. Ghesquière was named LV’s artistic director of women’s collection late last year in November. This would be Ghesquière’s first show after his surprising exit from Balenciaga after 15 years. Although the women’s collection is only a fraction of the LVMH empire, I would be very interested to see how it would impact LVMH’s share price which is currently at USD 36.85.

2014Feb26_lvmh_stock

Google Finance

Ghesquière is known for his avant-garde designs and I mean that with no irony. This Vogue article outlines some of those designs. To highlight how his design can propel trends, this crop top was one of the pieces for his last collection Spring 2013 for Balenciaga in 2012, famously worn by Kristen Stewart. Fast forward to today, and the crop top is still on the hot list of the fashion set. More importantly, Ghesquière can also produce something commercially successful, massively so – the Lariat Moto bag. Not that Louis Vuitton needs some reviving, still enjoying the commercial successes under Marc Jacobs but it would be interesting to see how Ghesquière’s vision would affect the brand.

I will definitely be watching this debut closely. Mark your calendars for March 5, 2014 at 10 AM Central European Time. Allons-y!