Set Sail For Louis Vuitton’s New “Island” Store in Singapore – 30/9/09

Louis Vuitton is making waves this week with the news that they plan to open a unique “island” store that will “float” on water in Singapore.

According to the Luxury Insider, this boutique at Singapore’s Marina Bay Sands will be enshrined in a stand-alone glass-and-steel crystal pavilion that appears to float on the water off the integrated shopping centre, restaurant and entertainment complex.

We like the sound of this novel concept, but can’t help wondering whether it was inspired by one of France’s most famous desserts, Oeufs á la Nage (which means ‘floating island’)?

For a closer look at the Marina Bay Sands concept, click here to visit the official website.

Burberry Offers Casual Chic To U.S. Market – 29/9/09

U.K. brand Burberry definitely has its heart set on winning over the struggling U.S. market. They even went as far as to expand their fashion line-up to a “more casual ‘Brit’ line”, according to a Bloomberg article.

Burberry C.E.O Angela Ahrendts said, “We do believe there is a broader opportunity in a market like America with our department-store partners to sell more of the casual ‘Burberry Brit’ range.”

This “more casual line” will feature US $600 trench coats and US $150 Wellington boots.

Evolving to suit the market seems to be already working in Burberry’s favour. Burberry’s Chief Financial Officer, Stacey Cartwright, said she is “optimistic” of a stronger second half in the U.S. as buyers increase inventory. A “handful” of stores have already indicated they will be giving floor space to its relabelled, more casual ‘Brit’ line.

See the MO Down for September 7 for our report on Burberry’s planned U.S. expansion entitled It’s Full Steam Ahead For Burberry In The U.S.

Asian Market “A Primary Focus” For Gucci Group – 28/9/09

Speaking during Milan Fashion Week, Gucci Group Chief Executive Officer, Robert Polet, told Bloomberg that, “For a long, long time to come, Asia will be the primary focus of Gucci Group investments.”

Polet also added that 22 of the 27 stores the company opened in the first half were in Asia. He said, “Emerging markets remain engines of growth. They might slow down slightly, but they’re still growing.”

Polet also suggested that acquisitions may be on the agenda, but would not discuss possible targets.
Still on the Asian expansion theme, we read in The Economic Times that Gucci has parted ways with its Indian franchisee, Vijay Murjani, in favour of a franchise agreement with Luxury Goods Retail, run by investment banker Ashok Wadhwa. However, this new agreement is in the process of being converted into a 51:49 percent interest* joint venture (JV).

A spokeswoman from Ashok Wadhwa stated, “Gucci will control the majority stake in the JV and it will drive the day-to-day business in India.” So it seems to us that Gucci is in a good place right now – holding the reins to a potentially lucrative partnership.

*Indian rules allow only 51% foreign investment in single-brand retail and none in multi-brand retail.

Burberry Shares Surge Over 5 Percent – 25/9/09

Burberry shares surged 5.4 percent after their Chief Executive Officer, Angela Ahrendts, said the luxury brand’s U.K. business is “on fire.”

This is more good fortune for Burberry, who recently joined the FTSE 100 Index (see the MO Down on 10 September for full details).

Hermes’ CEO Is Downhearted About Japanese Sales Slump – 25/9/09

Hermes International’s Chief Executive Officer, Patrick Thomas, has told Bloomberg that he “is not optimistic at all” about the next six months because of a delayed economic recovery in Japan, the French luxury-goods maker’s biggest market.

Thomas said, “I’m not expecting to see the light of the tunnel before 2010. The Japanese economy is not good and we all feel it.”

The article goes on to say that Japan, where Hermes made 22 percent of last year’s 1.76 billion euros (US $2.6 billion) in sales, had 2.3 percent growth in the second quarter, less than initially estimated.

Hopefully the tide will turn for Hermes in Japan. In the meantime, the brand seems to be making all the right moves to attract luxury clients. For example, last month we reported the launch of a Hermes helicopter that transports customers from the airport to the city (refer to the MO Down for 10 August: Hermes Takes Customer Service To New Heights In Japan.)

And click here for the rest of Bloomberg’s interview with Patrick Thomas.

Tiffany & Co. Loses Their Trademark Showdown – 25/9/09

Trademarks are still a hot topic this week, with news that luxury jewellery chain Tiffany & Co. was unsuccessful in their recent attempt to prevent New York fashion designer Tiffany Koury from registering her name as a trademark.

Lawyers for Tiffany & Co. used evidence from Koury’s MySpace pages to argue that Koury was attempting to capitalise on the company’s reputation.

However, the Australian Trademarks Office ruled in favour of Koury, suggesting there could be no "danger of deception" between the two brands.

For a full report on this hearing, click here.

Google Wins The Battle But Not The War Against LVMH – 24/9/09

In the case of Google vs. LVMH, a European Union court advisor has ruled that Google Inc does not violate luxury brand trademarks when it sells brand names as advertising keywords in internet searches.

Although this ruling is not binding, it is a blow for LVMH. The luxury group has been fighting Google for almost seven years in France over this issue.

But the war is not over. The final ruling on this case by the EU's Luxembourg-based high court is expected in the coming months, according to an AP article. If LVMH wins, it is a victory for all luxury brands.

Click here for a Bloomberg article that provides background information on this history-making case.

Shock Resignations Rock Richemont’s Watch Brands – 24/9/09

Times have been tough for luxury watch brands lately. And the tensions seem to have boiled over, with news that not one but two C.E.Os of Richemont’s watch brands have resigned this week.

We read in a Bloomberg article that Michel Nieto, C.E.O of Swiss watch brand Baume et Mercier, was first to resign citing “a strategy disagreement.”

Then only a day later, Fabian Krone, C.E.O of German watchmaker Lange & Söehne, “stepped down due to differences of opinion over strategy.”

And as Richemont raced to restructure their brands, new watch export predictions were released by the Swiss Watch Federation. The news was mixed: the pace of the watch market decline has eased, but appetite for timepieces remains weak in the key Hong Kong and U.S. markets. The positives were that China was up by 20 percent and Singapore was also up 9.6 percent," according to Vontobel analyst Rene Weber. To read more on the outlook for watch brands, click here.

For background information on the watch slump, refer to the MO Down on March 15.

Young US Designers Rip Into Louis Vuitton Creations – 23/9/09

When we said young designers ‘rip into’ Louis Vuitton pieces, we don’t mean verbally – we mean literally.

Let us explain. Recently Louis Vuitton donated vintage clothing – some pieces up to 100 years old - to the Parsons School of Design in New York as part of a student design project called 'Reconstruction'. Ten teams of two students were then asked to disassemble the clothing and make something new, all in one day.

All of these designs are currently on display in the windows at Parsons, located at 13th Street and Fifth Avenue. Another clever way for Louis Vuitton to appear in the spotlight as an aspirational brand, particularly as the media were all over this story.

To look at the winning design, click here to go to The New York Times website. And to find out more about Louis Vuitton’s sponsorship project, click here for a detailed CBS News article.

LVMH Comes Out On Top in Counterfeit Perfume Court Case – 22/9/09

Louis Vuitton seems to be on a winning streak with their ongoing war against counterfeit. A French court recently ordered online auction site eBay to pay 80,000 euros (AU $136,133 dollars) to the luxury brand for selling fake perfumes, according to an AFP article.

"The court found that in using key words from certain LVMH brands, eBay had committed several acts of counterfeiting," LVMH said in a statement.

It was only a few weeks ago that Louis Vuitton won a lawsuit they filed in 2007 (see the MO Down for 3 September) against an online company selling fake Louis Vuitton merchandise. So the message should be getting through to eBay and other online companies, selling counterfeit does not pay …

Louis Vuitton: A Clear Winner In The Value Stakes – 21/9/09

Louis Vuitton has emerged victorious in a global report by Interbrand; miles and miles ahead of their competitors: Gucci, Chanel, Hermes, Prada and Armani.

This report, entitled, ‘Best Global Brands 2009,’ saw Louis Vuitton score the top value ranking at a 16th place, with US $21.12 billion in projected annual cash flow.

Also in the top 100 were:
Gucci at 41st, with a value of US $8.12 billion
Chanel, 59th, US $6.04 billion
Hermès, 70th, US $4.59 billion
Prada, 87th, US $3.53 billion
Armani, 89th, US $3.3 billion

So Louis Vuitton was a clear winner. And the reason for that win is “trust”, according to a WWD article. Jez Frampton, Interbrand’s global CEO, stated, “The relevance of all brands at this time is that they are something you can trust, something you can believe in.”

Frampton also revealed that evoking the superior customer experience is Louis Vuitton’s strength. He said, “The environments Louis Vuitton creates are stunning,” he said. “The store on the Champs-Elysées in Paris is a knockout, and the store in Tokyo is magnificent.” We agree wholeheartedly.

To download the full Interbrand report, go to: http://www.interbrand.com/best_global_brands_intro.aspx?langid=1000

Tiffany & Co. Feeling “Optimistic” About Christmas Sales – 21/9/09

Speaking to Reuters from an economic forum in Dublin, the President of Tiffany & Co., James Quinn, stated, “We are reasonably optimistic about the holiday season."

He also added, “We are still not in positive territory. We are planning financially a more conservative outlook."

But despite weakened sales, he was adamant that Tiffany will not fall victim to discounting. Quinn responded to this question with, "No, we still believe the right pricing strategy is to price the product right first time."

Read more at Reuters.

Burberry Launches Its Own Social Networking Site – 21/9/09

Not content on being the most popular luxury brand on Facebook with 671,393 fans, Burberry has just launched its own social networking site, the Art of the Trench (artofthetrench.com).

This site, which the company describes as a "social media platform", will feature users sending in pictures of themselves wearing Burberry trenchcoats. It also includes links to Burberry’s Facebook and Twitter accounts.

Chief executive Angela Ahrendts told the Financial Times the site would allow Burberry to reach new shoppers and maintain the loyalty of current consumers.

"These might not even be customers yet. Or they may be a customer for a bottle of fragrance or for eyewear. But these are the customers who need the brand experience, who need to feel the brand. That word-of-mouth spreads through their social networks and continues to be a positive conversation [about Burberry] . . . that is so powerful," said Ahrendts.

There has been mixed reactions to Burberry’s new website. Read more here. And for our take on luxury brands using social networking sites, read the MO Down for June 29 (It’s The Battle Of The Brands On Social Networking Sites).

An Ebay Store On High Street? 18/9/09

Could we be seeing an eBay store on Avenue Montaigne, Fifth Avenue, Castlereagh or Collins Street anytime soon? According to an article in The Associated Press "The European Commission is currently weighing changes to rules that currently give luxury goods the right to choose who distributes their products. It appears to support the luxury industry by suggesting suppliers could require online retailers to sell a certain amount of goods in an actual, bricks-and-mortar store."

Naturally eBay is not at all happy with the thought of this and argues that it prevents online sales of legitimate products across Europe and in the end the customer pays more. However, we feel this will be a tough stance for eBay given LVMH successfully sued the online retailer last year and was awarded $61 million euro's for their effort because counterfeit products were distributed on eBay.

It appears eBay have set their own precedent. And due to similar counterfeit issues highlighted by Tiffany & Co. amongst others, in the recent past, the concern of the luxury houses is one of control, when it is outside of their owned and managed environments. But then again, what does the customer want? No doubt there is more to this debate and we will keep you posted as we learn more of where the European Commission settles on this subject.

A Toast To Christian Lacroix’s Designer Whiskey – 18/9/09

There has been no word yet on whether the Christian Lacroix bankruptcy bailout will go ahead (see the MO Down for September 9 for a rundown). But we wonder if Lacroix will soon be celebrating his good fortune with a glass of Chivas Regal whisky from the limited edition range he designed himself.

We read in The Luxury Insider that each bottle of Chivas 12 Magnum has been produced using a unique laser metallisation technique to precisely deliver the lavish and sophisticated bottle design created by Lacroix.

Available next month globally, the Chivas 12 Magnum has been limited to 15,000 editions worldwide. Each bottle will cost from US $400. A fine drop that’s fashionable to boot!

Fabergé Is Back In Business After 90+ Years – 17/9/09

Stop the press! Fabergé, the world's most iconic jeweller, is relaunching with the unveiling of its first collection since 1917.

Pieces in the collection start at a retail price of US $30,000 with an average price of US $200,000. And surprisingly, distribution is limited to a pioneering online store at http://www.faberge.com/, supported by a single retail store in Geneva.

According to an article in Emirates Business 24/7, the Fabergé website is supported by a team of multilingual sales advisors, available 24 hours a day, seven days a week. That’s what we call first-class customer service.

Mark Dunhill, CEO of Fabergé, says: "Fabergé is setting new standards for the luxury industry, challenging conventions which have traditionally meant that the client is confined to the rules and rituals, opening hours and geographical locations of luxury brands.”

For those who don’t know, the House of Fabergé was forced to close in 1917 in the face of the Russian Revolution. But we strongly believe its name is still synonymous with absolute luxury.

We must say that we are impressed with Fabergé’s relaunch and we have not even seen their designs yet.

Lindsay Lohan Is Let Loose At Emanuel Ungaro – 16/9/09

Do our eyes deceive us, or has Lindsay Lohan really been hired as artistic adviser for Paris house Emanuel Ungaro?

Strangely, it is true. A New York Times article confirmed this rumour, which has raised eyebrows in the fashion world due to Lohan’s less-than-glamorous history (and that’s being kind!).

Mounir Moufarrige, the Chief Executive of Emanuel Ungaro, acknowledged that the move would likely create waves among French fashion purists, possibly even charges of bad taste, but he argued that the times called for a manoeuvre he likened to “electric shock treatment.”

Emanuel Ungaro was once a protégé of Cristobal Balenciaga. He sold his business in 1996 and sales of the high-end brand have dropped substantially since.

So, will Lohan draw attention to the brand or scare buyers off? We suspect it may be the latter. Sometimes contrasts in fashion are wonderful however we think the gap may be too wide to garner the support Ungaro is hoping for... And anyway isn't Lohan yesterday's news? But then again perhaps Ungaro are going for a recent retro revival moment!

It’s Goodbye Prada, Hello Reed Krakoff For Graziano de Boni – 16/9/09

Has Reed Krakoff poached Graziano de Boni from Prada? We can’t be sure. All we know is that de Boni, President and CEO of Prada USA, is leaving his post to become the president of the newly formed Reed Krakoff brand.*

De Boni’s departure from Prada once again vacates a job that was open for two years prior to his arrival. Prada officials have not yet commented on de Boni’s successor.

*Reed Krakoff is the creative force behind Coach. He launched his own personal brand in July this year.

For background information on de Boni and the Reed Krakoff brand, consult this WWD Business article.

Tiffany & Co. Sues Westfield As H&M Gets Too Close For Comfort – 15/9/09

"The location of the H&M store will cause irreparable injury to Tiffany's business reputation as a luxury retailer, a reputation that Tiffany has enjoyed and worked hard to maintain for more than a century and a half." This is an extract from a Los Angeles lawsuit between upscale retailer Tiffany & Co. and Australian shopping giant Westfield.

This dramatic retail showdown is happening in Westfield's Century City shopping mall in Los Angeles, which is home to high-end stores including Louis Vuitton, but also has lower-end chains like Gap and J Crew.

Tiffany’s lawyers definitely believe H&M, a Swedish fashion chain, will be too close for comfort and be bad for business. They are arguing that their contract with Westfield protects it from retailers "whose merchandise and/or price points are not considered to be luxury, upscale or better by conventional retail industry standards".

We will be watching this court case closely as we certainly have knowledge on the Australasian market that most luxury brands, when negotiating leases, include a clause on the level of other retailers they will accept next to them (sometimes naming them), in essence it gives brands an 'opt out clause' if the landlord does not deliver the quality of other tenants that are often discussed in the wooing process. If Tiffany & Co. wins, it may set a precedent that sees high-end brands able to safeguard the streetscapes in which their stores appear. Yes, we agree, it is about the mix of brands, however first and foremost it is about the environment. Like attracts like..
Click here to read more.

More Change Is In The Air For Versace – 15/9/09

Quick news flash from Forbes: Michele Sodi has been appointed CEO of Versace USA. Sodi has worked with Balenciaga and Jil Sander in the past.

This is another example of Versace’s major staff reshuffing, which began with Gian Giacomo Ferraris taking over from Giancarlo di Risio as company CEO in June (see the MO Down for 11 June for a full rundown).

Christopher Bailey Speaks Out On Burberry’s Success – 14/9/09

Last week, Burberry made their grand entry to the FTSE 100. And it appears that their Creative Director, Christopher Bailey, is over the moon about it.

He told The Independent that "I never imagined we could have been a FTSE 100 company. I still think of us as this tiny little company. We're very tight, everybody knows each other. It's a very friendly, embracing company. And this is huge."

Bailey also said, “Burberry is about heritage, but about making that heritage relevant for today. You have to make sure what you do is right for the moment you live in."

We definitely agree with Bailey; brands must be adaptable to the times. There’s nothing worse than being stuck in the past.

Don’t miss this extremely detailed article: Best Of British: Why Burberry Has The Fashion Business All Wrapped Up.

Gianfranco Ferré Set For A Revamp – 14/9/09

Gianfranco Ferré, the Italian brand in bankruptcy administration, has surprised everyone by splashing cash around on a brand revamp.

We read in The New York Times that Gianfranco Ferré “has enough cash to stage fashion shows, introduce a shoe and handbag line and roll out a new logo.”

Ferré’s CEO, Michela Piva, claimed, “I think the luxury business has been through the worst. It has hit the bottom.” She also said, “The company was looking to infuse new life into the brand while retaining the heritage of its founding designer.”

Ferré’s administrators were granted a 30 million euro, or US $44 million, budget this year, part of which they decided to grant to the fashion house to fund the revival of the brand. The company benefited from Italy’s Marzano law, which enables administrators to let a company operate normally so that it can preserve its value for potential buyers. Read more about this in the MO Down for August 24: Italy Bails Out Its Debt-Ridden Luxury Brands.

More Smooth Sailing For Louis Vuitton With Their New Yacht Circuit - 11/9/09

In November, it will be all hands on deck for the new Louis Vuitton World Series yacht circuit, which will make stops in New Zealand and Italy.

The Associated Press called the World Series an “America’s Cup-class yachting race.” Created in association with the newly established World Sailing Team Association, it will feature ten teams, including Emirates Team New Zealand and American syndicate BMW Oracle. All exceptionally strong, globally established brands are involved. Sponsorship certainly has its advantages, the exposure for this series will be incredible thus reinforcing the power and reach of the Louis Vuitton brand and the aspirational message it holds.

Following the highly successful Louis Vuitton Pacific Series held in Auckland, the World Series will start in Nice, with a first regatta on November 7-22, before a stop in Auckland in March. A third stage is scheduled for La Maddalena, Italy, in May.

Sailing enthusiasts, click here for event launch photos and further information on this momentous event.

Burberry’s Poised To Enter The FTSE 100 – 10/9/09

Yesterday was a big day for British luxury brand Burberry. They are now proud members of the FTSE 100 Index, replacing media group Thomson Reuters, who have delisted.

The media was a buzz with this development. The Independent said it was “a further sign of its revival under chief executive Angela Ahrendts.”

Analysts were also watching Burberry closely. Analyst company Numis Securities forecast that “Burberry will deliver full-year 2010 pre-tax profits of £178.8m, up from £174.6m in 2009.”

Numis analyst Nick Coulter said, "Burberry remains a compelling medium-term growth story, benefiting from an under-penetrated brand, a coherent strategy to extend the breadth and depth of its offer, and a programme of ongoing self-help measures that have protected its earnings from the worst of the global slowdown."

We couldn’t agree more. Burberry has been one of the more resilient brands in recent times. See the MO Down for 10 June, Another Message Of Hope From Burberry, for one of our Burberry updates.

You can also click here for Reuters’ take on Burberry’s grand entrance into the FTSE 100 Index.

Lacroix Moves One Step Closer To A Borletti Bailout –9/9/09

We wondered just over a month ago: ‘Is There A Winner In The Lacroix Bidding War? (see The MO Down for 29 July). And now, it is looking more and more like the Borletti family will ‘seal the deal’ on the Lacroix rescue package by the end of this month.

There is not much more to tell at the moment, but we definitely have our fingers (and toes) crossed for Lacroix.

Read more in this Reuters’ article: Lacroix Administrator Eyes Borletti Deal.

Wal-Mart Trumps Tiffany & Co. In U.S. Consumer Poll – 9/9/09

Welcome to the jewellery wars. On one side stands a $500 Tiffany & Co. piece, elegantly packaged in an eggshell blue gift box. Meanwhile, the other side contains a strikingly similar Wall-Mart item, worth $250, in a nondescript plastic bag. Which one would you choose?

If you choose the Tiffany piece, you are in the minority. Only 10 percent desired the luxury brand. A whopping 78 percent picked the Wal-Mart jewellery, while the others remained undecided.

Surprised? Yes, so were we. This survey conducted by Zogby Interactive involved 41,175 adults, and concluded that, "People [in the U.S.] are moving toward a simpler, less materialistic lifestyle."

What does that mean for Tiffany? Well, it could mean continued expansion of their 'entry point' high volume sterling silver lines like the Keys collection. (as discussed in The MO Down on 21 March). Or, they could continue happily wooing the 10 percent who can’t live without Tiffany’s timeless masterpieces. Let’s face it, Tiffany has never really been aimed at the masses however they are a brand that has some excellent elasticity and this is not always easy to achieve.

To read the full Reuters report, click here.

Risky Business: HSBC Uncertain About The European Luxury Market – 8/9/09

International bank HSBC says that the European luxury goods sector is a tad risky right now, according to a Wall Street Journal research note released on Friday September 4th. The report said the luxury sector appears to have entailed some "unaccounted-for" risks, and that it prefers spirits and sporting goods". Which is somewhat surprising for us to read, given the issues the French champagne houses are facing with overstocks. See The MO Down for 25 August, A French Champagne Row Is Causing Sour Grapes, for our thoughts on the champagne crisis.

It’s Full Steam Ahead For Burberry In The U.S. – 7/8/09

Time is of the essence for Burberry, Britain’s largest luxury goods company, as they speed up their U.S. expansion plans.

Their Chief Financial Officer, Stacey Cartwright, revealed in a Bloomberg article that they “may open more than the five stores previously forecast for the Americas this year.”

The reason behind Burberry’s predicted American growth and investment is the cheaper real estate deals that are currently on the table. And there are not only cheaper rents, but also additional landlord support for fit out, rent free periods, etc. These deals seem like the icing on the cake for Burberry. Since, they are currently underdeveloped in the U.S, this certainly seems like the right time and place for this hot brand to continue on its trajectory.

Article by: Melinda O'Rourke

For Versace, It’s Out With The Old, In With The New – 7/8/09

It seems as one door closes, another one opens in the world of Versace. According to Reuters, Versace has ended its licensing contract with IT Holding, which owns Milan fashion house Gianfranco Ferre and was put into special administration earlier this year. See The MO Down for 24 August for more information.

So it's arrivederci to IT Holding and ciao to Gruppo Facchini, "an Italian company that operates in clothing, hotels and art, and which already works on Versace group's Versus line."

To read more on these developments, click here.

Article by: Melinda O'Rourke

The Eye of The Panthere Is Firmly on China - 4/9/09

The iconic French fine jeweller and watch maison Cartier, part of the Swiss luxury group Richemont, is investing for significant growth in China. According to a Reuters article, Bernard Fornas, president and chief executive of Cartier, announced at the China Investment Summit last Thursday that they are going to "double the number of stores on the mainland". Currently they have 32 boutiques in 18 cities and China is second to Japan in number of stores.

Fornas also had some low-key positive comments on the economy when he said "the worst of the financial crisis was likely behind the luxury jewelry firm, as strong demand in China and the Middle East is compensating for weakness in traditional strongholds Japan and the United States."

Cartier was rated the number one luxury brand in Beijing according to the recently released Hurun Report. See The MO Down, Beijing Is Officially Billionaire Central - 26/8/09.

So the Cartier Panthere is looking squarely in the eyes of the emerging Tiger - it's big cats at play now. Cartier are pouncing on this opportunity and committing to maintaining their strong and coveted brand status on this very large and growing market.

Article by: Melinda O'Rourke

Go West - Burberry Opens In Perth, WA - 3/9/09

The infamous Brit Brand as opposed to the infamous Brit Boy Band opened last night in the new Wesley Centre on Hay Street. We have learned that it will be the biggest Burberry store in Australia, with some 400sqm dedicated to fashion apparel and accessories. Read More...

This takes the international luxury and premium end fashion mono brand representation count now to 6 with Louis Vuitton, Gucci, Tiffany & Co., Bally, Emporio Armani. And that doesn't include the rumoured openings of a couple of other luxury brands...but mum's the word on that. Will Perth become the gateway to Asia Pacific in the coming years?

Article by: Melinda O'Rourke

Another Victory For The Fight Against Counterfeit Product - 3/9/09

Louis Vuitton is once again victorious in its ongoing efforts to stem the flow of counterfeit product to the market and the conduits these items flow through. We read yesterday in a Reuters article that Louis Vuitton, part of the LVMH group have won a lawsuit they "filed in 2007 against the California based Internet hosting business of Akanoc Solutions and was awarded $32.4 million in damages.” Nice work.

According to another article in The Associated Press " Louis Vuitton Malletier filed the lawsuit in 2007, after finding a group of Web sites with the same Internet address selling what it believed was counterfeit Louis Vuitton merchandise”. Q: What did the jury find? A: That Akanoc Solutions were in fact liable for contributory trademark and copyright infringement.

So the message, if it looks like a fake it probably is, if the price looks too good to be true, it probably is because it’s not the ‘real deal’. Don’t buy counterfeit, don’t trade in counterfeit, it simply does not pay… and if brand and status are important to you, it’s not a good look.

Article by: Melinda O'Rourke

Luxury Brands A Worthwhile Investment, 2/9/09

With emerging countries accounting for almost a third of all luxury products sales globally. Their contribution to growth is even bigger with around three-quarters of luxury industry growth originating from the emerging world. According to an article in FTAdviser "Given the good prospects for emerging markets in the long term, they are already the principal growth driver for western luxury brands and are likely to be even more important in the future".

Despite the current economic woes of some of the luxury brands in some markets, most notably the US, Russia and some parts of Europe, there is certainly a comfort in knowing these brands will 'ride' again. The interest for the classic brands in China, India and the Middle East is intense and therefore bodes will for a strong future investment.

Luxury is a satisfying and profitable business. There is no coincidence that the wealthiest man in France is the CEO of LVMH group. As we have reported many times before here at The MO Down the success of luxury brands is still in the innovation, uniqueness and rarity of their environments and products. The consistent excellence in their service offer and the quality of their products. In addition the most successful companies "have sound balance sheets, which give them the financial capacity to continue to invest in tougher times. Good examples are brands like Hermès and Louis Vuitton for accessories, and Cartier and Omega for watches and jewellery. These brands are expected to continue to show double-digit margins even this year, reflecting their pricing power.", according to the article in FTAdviser.

China is still in its infancy and India relatively untouched, so it would seem the future holds prosperity for luxury brands that continue to deliver. We're definitely on board and look forward to riding on this long wave!

Article By: Melinda O'Rourke

New Hope For Japan’s Struggling Luxury Industry? – 1/9/2009

Let's hope the newly elected Japanese Prime Minister Yukio Hatoyama, leader of the Democratic Party of Japan, can really work on the Japanese economy, which has been struggling for several years.

To sight a recent example that is typical of what is happening in Japan in the luxury areas: "Mitsukoshi, the iconic Japanese department store operator, plans to slash its workforce by about one-sixth to cope with dwindling demand for luxury goods.”

This article, written by AFP, also went on to say, "Mitsukoshi, which is often compared to Britain's Harrods or US-based Bloomingdale's, will shoulder the costs by selling one of its stores in Tokyo which closed in May."

Is this the sign that Japan has reached its peak in the luxury consumer market? With an ageing population as one of the many issues facing Japan the new government has promised to reverse the “crippling fertility decline”, which has led to Japan's decreasing population, according to an article in The Australian "Pivotal Moment In Japan’s History" by Foreign Editor Greg Sheridan. Naturally, this will all take time and we wonder if there will be other casualties until the big ship is slowly turned around.

Article by: Melinda O'Rourke