Luxury isn't what it used to be. The value of the top 10 luxury-goods brands fell 6 per cent, or US$7.1 billion (S$9.6 billion), to US$105 billion as companies from Prada to Cartier grappled with slowing sales in China and Russia.
According to the 2015 BrandZ study, only Louis Vuitton and Chanel saw an increase over last year. Vuitton gained 6 percent to $27.4 billion, placing LVMH Moet Hennessy Louis Vuitton SE’s biggest brand atop the luxury ranking for the 10th straight year. Chanel’s value rose 15 percent to $9 billion, propelling it to fourth in the list behind second-place Hermes and Kering SA’s Gucci.
In the battle for brand influence, Apple edged out Google as the most influential global brand and Louis Vuitton maintained its 10-year reign, keeping the top spot on the luxury chart as brand analyist company Millward Brown released its rankings on Wednesday.
The 10th Annual Brandz Top 100 Most Valuable Global Brands Ranking was released Wednesday by WWP and Millward Brown, and ranked Microsoft in the third position, followed by IBM.
For Louis Vuitton, it’s been 10 years of domination over Hermès, Gucci and Chanel who finished in the second, third and fourth spots, respectively.
Spending on gifts has fallen in China as the government clamps down on corruption, while Russia's shoppers are suffering from the ruble's depreciation and sanctions tied to the conflict in Ukraine, Millward Brown said. At the same time, efforts to appear more exclusive have created opportunities for cheaper brands such as Michael Kors and Tiffany, which finished in the top ten for the first time, the researcher said.
Chanel, the maker of No 5 perfume, and handbag purveyor Vuitton fared better than their peers thanks to their unique approach, according to Ms Elspeth Cheung, Millward Brown's Global Brandz Valuation Director.
Chanel has harmonised prices across regions, encouraging more in-store consumption, Ms Cheung said. And Vuitton has successfully revitalised its brand with a fresh take on its original LV monogram.
The worst performers were Cartier, whose value decreased 15 per cent to US$7.6 billion, placing it sixth, while Prada slumped 35 per cent to US$6.5 billion, according to the study. An overly expensive product mix and lack of novelty at Prada have led shoppers to spend elsewhere, analysts at Exane BNP Paribas have said.
Hermes's value fell 13 per cent to US$18.9 billion and Gucci declined 14 per cent to US$13.8 billion, according to the study. Rolex fell 6 per cent to US$8.5 billion, placing it fifth. Rounding out the top 10 most valuable luxury brands were Burberry in eighth, Michael Kors and Tiffany.