The novel coronavirus crisis might have hit the luxury industry hard, but there are still some brands that have been able to thrive by adapting to the changing needs of consumers.
As a recent annual report of top 50 most valuable luxury and premium brands by independent consultancy Brand Finance shows, while the most successful companies have shrunk in overall value, those in the top 10 have seen their valuations grow as a result of public reception to their reputation for sustainability and considered manufacturing.
Porsche, which has secured the No.1 spot in the top 50 list, has, for instance, seen success with the launch of its Taycan electric car, making it the first traditional luxury car manufacturer to launch a fully electric model. It registered a 16% brand value increase to US$33.9 billion, says the list released in Brand Finance’s Luxury and Premium 50 2020 report, which ranks businesses based on the overall brand value as well as their power in influencing consumers' choices.
Gucci took the second spot, with a brand valuation of $17.6 billion, while Louis Vuitton was third, with a brand valuation of $16.5 billion. Cartier, Chanel, Hermes, Ferrari, Rolex and Dior followed in the top 10.
The report shows Givenchy is the fastest-growing brand in 2020 ranking, its brand value growing 74 per cent to $2 billion, simultaneously jumping 11 spots in the ranking from 37th to 26th. The brand’s strong performance and growth, particularly in its makeup division and through its L’Interdit perfume, contributed to its parent company LVMH’s solid financial performance over the previous year.
The report, however, notes that in the face of COVID-19, the world’s top luxury-based companies could lose up to US$35 billion in accumulative brand value.
“There is no denying the importance of the Chinese market in ensuring the good health and growth in the luxury and premium sector. We have witnessed the Chinese successfully keep the sector above water following the 2008 crash and luxury brands will be relying on this market once again in the wake of the coronavirus pandemic,” said Alex Haigh, valuation director at Brand Finance, in a press release.