The success of new American luxury brands leaves Kering unmoved

The success of new American luxury brands leaves Kering unmoved

Michael Kors, Marc Jacobs, Tory Burch, Kate Spade, Diane Von Furstenberg... Buoyed by their success across the Atlantic, these young American luxury brands, more accessible than their French and Italian rivals, are setting out to conquer Europe and of Asia in order to take market share from them.

Last February, Bernard Arnault, CEO of LVMH, was delighted with the growth prospects of Marc Jacobs, the second label in its fashion & leather goods division behind Louis Vuitton, which the French group has planned to list on Wall Street. At the same time, the boss of the world leader in luxury confided his regret at having sold, at the end of the 1990s, the participation of LVMH in Michael Kors, founded by a former artistic director of Céline, a brand of the group…

Kering (Gucci, Saint Laurent, Bottega Veneta) has never had such an American label in its portfolio. This lack arouses in its CEO, François-Henri Pinault, neither regret, nor desire, nor project. “These are not luxury brands, he asserts. They are made in China and do not meet our criteria of know-how, creativity and choice of materials. They do marketing.”

Le succès des nouvelles marques de luxe américaines laisse Kering de marbre

By abandoning the segment of bags sold for 500 to 800 euros to avoid being overused and by targeting exclusive luxury (occupied by Hermès, Chanel and Bottega Veneta), Louis Vuitton and Gucci nevertheless offer a boulevard to these American brands, whose bags are sold from 300 euros.

“We prefer to leave them market share rather than go on their ground, assures François-Henri Pinault. The real challenge of luxury is to maintain its exclusivity. Gucci cannot offer too wide a range of prices in the bags.” Following the Hermès model, the Florentine brand prefers to focus on more accessible products in other categories (shoes, accessories, silk) and to diversify into other segments: children's clothing and accessories, tableware and cosmetics.

Could the success of Michael Kors and Marc Jacobs encourage Kering, which only owns Italian, French and British labels (with the exception of Chinese jeweler Qeeling), to expand its portfolio by buying an emerging American label? “We have too much to do with luxury to buy a brand in order to enter another segment”, insists François-Henri Pinault…