Professional Documents
Culture Documents
Scope
All values expressed in this report are in US dollar terms, using a fixed
exchange rate (2013).
2013 figures are based on part-year estimates.
All forecast data are expressed in constant terms; inflationary effects are
discounted. Conversely, all historical data are expressed in current terms;
inflationary effects are taken into account.
Colour Cosmetics
US$55.5 billion
Microwaves
Refrigeration
Home
60,669
Appliances
Laundry
Large
Cooking
Home Laundry
Confectionary
144,010
121,107
Appliances
Appliances
132,745
121,107
US$185,477 mn
Microwaves
60,669
Disclaimer
Much of the information in this
briefing is of a statistical nature and,
while every attempt has been made
to ensure accuracy and reliability,
Euromonitor International cannot be
held responsible for omissions or
errors.
Figures in tables and analyses are
calculated from unrounded data and
may not sum. Analyses found in the
briefings may not totally reflect the
companies opinions, reader
discretion is advised.
Fragrances
Small
US$45.1Appliances
billion
Jewellery
1,724,022
Skin Care
US$107.3 billion
Sun Care
US$9.5 billion
Sets/Kits
US$17.9 billion
Euromonitor International
PASSPORT 2
STRATEGIC EVALUATION
COMPETITIVE POSITIONING
MARKET ASSESSMENT
GEOGRAPHIC AND CATEGORY
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
STRATEGIC EVALUATION
Paris, France
Regional involvement:
Global
Category involvement:
5.9%
35,000
7,000
30,000
6,000
25,000
5,000
20,000
4,000
15,000
3,000
10,000
2,000
5,000
1,000
0
2009
2010
2011
2012
2013
Revenue
Operating Profit
Euromonitor International
Revenue ( million)
PASSPORT 4
STRATEGIC EVALUATION
Euromonitor International
Revenue
Profit (recurring
operations)
% growth
2,683
2,800
200
204
20
15
10
5
0
France
Europe
(exc
France)
US
Jun-13
Japan
Asia
(exc
Japan)
Other
Jun-14
PASSPORT 5
STRATEGIC EVALUATION
WEAKNESSES
Premium womens
fragrances
LVMHs enviable portfolio LVMHs area of strength
of premium brands
is premium fragrances,
carries significant equity. particularly womens,
It represents an excellent where it ranks second
platform for developing
globally, with Christian
its presence in traditional Dior by far its most
and newer marketplaces valuable brand and its
with beauty increasingly most important growth
becoming a focus.
driver in the category.
OPPORTUNITIES
THREATS
PASSPORT 6
STRATEGIC EVALUATION
Euromonitor International
PASSPORT 7
STRATEGIC EVALUATION
COMPETITIVE POSITIONING
MARKET ASSESSMENT
GEOGRAPHIC AND CATEGORY
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
COMPETITIVE POSITIONING
Euromonitor International
2012
2011
2010
Company
1 1 1 1
2 2 2 2
3 3 3 3
4 4 4 4
6 5 5 5
8 8 6 6
7 7 7 7
5 6 8 8
9 9 9 9
11 11 11 10
10 10 10 11
12 12 12 12
14 14 13 13
%
company
share
2013
11.3 With a primary focus on premium products, and a
9.7 much smaller portfolio than some of its
competitors, LVMH ranks just outside the top 10
8.1
players in the global BPC market in 2013. The
3.8 companys growth slowed significantly during
3.0 2008-2009, although its beauty division was among
2.9 the less impacted.
2.8 However, it returned to strong growth in the latter
2.4 years of the review period and ranked among the
2.1 strongest performers in 2012, with near 10%
growth as the company benefited from a revival in
1.7
demand for premium products, specifically in the
1.7 US, as a result it moved up one place in the
1.7 ranking, a position it held on to in 2013. While
growth in 2013 was more moderate, it still held its
1.5
position due to strong growth in Asia and MEA.
PASSPORT 9
COMPETITIVE POSITIONING
10
% y-o-y growth
6
5
4
3
2
1
0
2008-2009
2009-2010
2010-2011
Premium BPC
Euromonitor International
2011-2012
2012-2013
LVMH
PASSPORT 10
STRATEGIC EVALUATION
COMPETITIVE POSITIONING
MARKET ASSESSMENT
GEOGRAPHIC AND CATEGORY
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
MARKET ASSESSMENT
% CAGR 2013-2018
LVMH is a smaller player in premium skin care - the biggest category within premium BPC, and the most
important growth contributor, expected to gain US$6.7 billion by 2018. More importantly Asia Pacific - the
companys key regional growth contributor - is also skin cares key growth contributor by region. The
company is expanding Fresh in the region, whose natural positioning fits well with consumer demand, as
well as expanding Ole Henriksen another natural skin care brand with a spa positioning and strong antiageing offerings.
LVMH: Premium BPC Presence 2013 and Growth Prospects 2013-2018 by Category
7
Premium baby and child6
specific products
5
4 Premium bath and shower
3
2
Premium sun care
1 Premium deodorants
0
0
5,000
Premium sets/kits
10,000
15,000
20,000
25,000
Market size 2013 (US$ million rsp)
30,000
35,000
40,000
Note: Bubble size represents company value share of category in 2013, range displayed: 0.2-14.5%
Euromonitor International
PASSPORT 12
MARKET ASSESSMENT
% CAGR 2013-2018
In terms of actual gains, premium BPC is expected to record the largest increase in Asia Pacific over 20132018, with China set to contribute nearly three quarters of the predicted US$7.8 billion category gain in the
region. LVMHs brands, which are both well known through their fashion heritage and have strong brand
image, are in a strong position to capitalise on the increasing number of consumers whose incomes are
rising and have a high desire for luxury brands. LVMHs beauty offerings are expected to capitalise the
most, being the entry price point into the brand for the majority of aspirational consumers.
LVMH: Premium BPC Presence 2013 and Growth Prospects 2013-2018 by Region
7
6
5
4
3
2
1
0
-1
Middle East/Africa
Asia Pacific
Latin America
North America
Eastern Europe
Western Europe
Australasia
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
Euromonitor International
PASSPORT 13
STRATEGIC EVALUATION
COMPETITIVE POSITIONING
MARKET ASSESSMENT
GEOGRAPHIC AND CATEGORY
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
Very strong growth is expected in the Middle East and Africa, where
some 40% of global premium fragrances absolute value growth will
come from over 2013-2018. The leading market will be Saudi Arabia
with a contribution exceeding US$600 million. However, this is a
market where local players continue to dominate, although LVMH has
made important inroads, reaching 6% of premium fragrances in 2013
(ahead of its multinational rivals).
LVMH leads premium fragrances in Asia Pacific as a result of a
strong cross-market presence, and its leadership position in the
regions largest market of Japan. While growth prospects are poor in
the latter, opportunities exist specifically in the high-growth markets of
China and India. Jadore replaced Chanel N5 as the top-selling
fragrance in China in 2013.
Euromonitor International
LVMH: Premium
Fragrances Presence 2013
and Growth Prospects
2013-2018 by Region
9
Middle
East/
Africa
8
7
6
% CAGR 2013-2018
Latin
America
5
4
Asia
Pacific
North
America
2
1
Western
Europe
Eastern
Europe
Australasia
-1
-2
0
10,000
20,000
30,000
PASSPORT 15
Euromonitor International
16
15
14
13
% value share
Premium Fragrances:
Global Value Shares of
Leading Companies
2008-2013
12
11
10
9
8
7
2008 2009 2010 2011 2012 2013
LVMH
L'Oral
P&G
Coty
Chanel
PASSPORT 16
100
200
300
400
500
600
700
PASSPORT 17
Euromonitor International
6
Middle
East/
Africa
4
% CAGR 2013-2018
Latin
America
Asia
Pacific
Eastern
Europe
Australasia
North
America
Western
Europe
-1
0
2,000
4,000
6,000
8,000
PASSPORT 18
30
25
20
15
10
5
0
2008
2009
2010
Este Lauder
Euromonitor International
2011
L'Oral
LVMH
2012
2013
Shiseido
PASSPORT 19
2,000
3,000
4,000
LVMH recorded positive growth in the key antiagers category - its most valuable category within
skin care (36% of its total skin care sales).
However, the company remains a small player,
ranking just 15th in 2013. To fully benefit from
premium skin care opportunities, a focus on
strengthening its position in the key anti-agers
category would be wise.
Euromonitor International
1,000
L'Oral
P&G
Este Lauder
Shiseido
Beiersdorf
Avon
Unilever
Mary Kay
Nu Skin Enterprises
AmorePacific
Amway
J&J
LG Household & Health Care
LVMH
Clarins
Others
PASSPORT 20
North America
Latin America
Eastern Europe
Australasia
Asia Pacific
500
1,000
1,500
2,000
2,500
PASSPORT 21
% value share
3,500
3,000
2,500
2,000
1,500
1,000
500
0
2013
Anti-Agers
Euromonitor International
2014
Facial Moisturisers
2015
Toners
2016
2017
Liquid/Cream/Gel/Bar Cleansers
2018
Face Masks
PASSPORT 22
STRATEGIC EVALUATION
COMPETITIVE POSITIONING
MARKET ASSESSMENT
GEOGRAPHIC AND CATEGORY
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
BRAND STRATEGY
The companys premium portfolio is led by Christian Dior, Guerlain and Givenchy, whose equity in
fragrances LVMH has used to build a strong profile in secondary categories, including colour cosmetics and
skin care. Guerlain in particular launched LHomme Ideal in 2013 and increased focus on skin care with its
Abeille Royale line. Its Orchide Imperiale line is growing rapidly in Asia and Russia. Givenchy introduced
Dahlia Divin, a new fragrance for women in 2013, and Gentlemen Only.
In addition, its high potential brands, which include BeneFit and Make Up For Ever (colour cosmetics),
Fresh (skin care), Acqua di Parma and Fendi (fragrances) and Parfums Loewe, are considered by the
company as an ideal complement to its timeless stars as they are offering new growth avenues for the
company. Loewe is going through a period of transition with a new creative director, the young and muchacclaimed J.W. Anderson. The Spanish brands fragrance line is also expected to be influenced by the
young director. Fendi also introduced new fragrances in 2013, Fan di Fendi pour Homme and
L'Acquarossa, with an emphasis on its Italian heritage.
LVMH: Sales of Leading Brands 2008/2013
3,000
2,500
2,000
1,500
1,000
500
0
Christian Dior
Guerlain
Givenchy
Kenzo
2008
Euromonitor International
BeneFit
Bvlgari
Loewe
2013
PASSPORT 24
BRAND STRATEGY
6
5
4
3
2
1
0
3,000
2,000
1,000
0
2009
2010
2011
Euromonitor International
2012
% y-o-y growth
Christian Dior is LVMHs leading BPC brand, with sales of US$2.9 billion in 2013 and the most important
growth contributor, with global sales increasing by just short of US$500 million over 2008-2013.
The brand derives the majority of its sales from fragrances (45% in 2013), where it operates with a variety
of lines including Jadore, Dior Addict and Miss Dior. In addition, Christian Diors colour cosmetics (28%)
and skin care (21%) are growing rapidly. Christian Dior performed strongly in 2013, recording just over 4%
growth, slightly lower from 2012 due to premium sales slowing in North America.
In terms of product lines, the company highlighted Jadore, which saw a new communication campaign,
and Miss Dior, whose 67 years of history were celebrated with an exhibition devoted to it at the Grand
Palais in Paris. This raised the image of both brand and fragrance. Dior Homme was a continued strong
performer in mens fragrances and Voile de Parfum was launched in womens fragrances. The Dior makeup lines were highlighted as making significant inroads in Asia. Their new product offerings from BB creams
to the light-boosting Diorskin Star foundation and concealer are catering to a younger demographic whose
obsession with social media makes them always want to be camera-ready.
Most importantly, Dior launched pop-up stores dedicated to its beauty offerings with a pop-up in Saint
Honore in Paris where consumers can get engravings on their fragrances and facial massages among
others. Diors takeover of Harrods in the UK in April 2013 also elevated the brands image.
2013
PASSPORT 25
BRAND STRATEGY
Euromonitor International
16
14
250
12
200
10
150
% y-o-y growth
6
100
4
50
2
0
2009
2010
2011
2012
2013
PASSPORT 26
BRAND STRATEGY
Euromonitor International
PASSPORT 27
BRAND STRATEGY
Euromonitor International
PASSPORT 28
STRATEGIC EVALUATION
COMPETITIVE POSITIONING
MARKET ASSESSMENT
GEOGRAPHIC AND CATEGORY
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
OPERATIONS
Euromonitor International
PASSPORT 30
STRATEGIC EVALUATION
COMPETITIVE POSITIONING
MARKET ASSESSMENT
GEOGRAPHIC AND CATEGORY
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
RECOMMENDATIONS
PASSPORT 32
RELATED ANALYSIS
The Battle of the Fragrance Titans - J' Adore Dior Vs. Chanel No. 5
Top Five Beauty Trends in 2014
The Parallel Trajectories of Apparel and Beauty, Part II: The Allure of Luxury
Fashion in Fragrances
The Parallel Trajectories of Apparel and Beauty, Part III: The Evolution from
Fashion to Lifestyle Brand
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PASSPORT 34