Louis Vuitton 2003 Annual Report Download - page 34

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WITH 38 % GROWTH IN DOL-
LARS IN THE UNITED STATES,
HOW DO YOU EXPLAIN THIS
SPECTACULAR BREAKTHROUGH
BY LOUIS VUITTON I N 2003?
YVES CARCELLE : First
of all, you have to re-
member that our presence
in the United States
is not recent. At the end
of the nineteenth century,
Louis Vuitton was already
selling his trunks in
New York and, right
after World War I,
the brand was already
in American department
stores. In 1980, the first
independent store ope-
ned--on 57th Street in
New York. The growth
we are now seeing in the
United States is the
direct result of the major
expenditures we have
devoted to this market
over the last five years in
terms of new stores and
communications. Fifteen
years ago, the customers
who purchased our pro-
ducts in the United States
were foreigners for the
most part, mainly Japa-
nese. Today those custo-
mers are nearly 90%
American, which
demonstrates the success
and the deep roots of our
brand in the country.
Furthermore, we have
just kicked off the cele-
brations marking our
150th anniversary with
the grand opening in
February 2004 of our
largest store in the world,
a true Louis Vuitton
house, on the corner
of Fifth Avenue and
57th Street in New York,
a stone’s throw from the
original location. This is
a strong symbol of our
long-term commitment.
LOUIS VUI TTON IS I NVESTING
IN CHINA IN EARNEST.
ISCHINA REALLY THE NEW
LUXURY ELDORADO?
Y.C. : We were pioneers,
opening our first store in
1992 in Beijing. Today
we have ten. In the
meantime, we have
worked year after year
to achieve brand reco-
gnition, so the growth
in sales we are now
experiencing is the result
of years of preparation.
Today Chinese consumers
and travelers spend more
in our boutiques than the
Japanese. The Chinese-
speaking world (i.e.,
continental China, Hong
Kong and Taiwan), inclu-
ding purchases made
during travel, already
represents Louis Vuitton’s
fourth largest customer.
We plan to continue
investing in China
– in 2004, for example,
a global store will open
in Shanghai – because
it offers tremendous
potential, provided
we adjust our pace to
that of the country’s
economic renaissance.
COULD YOU BRING US UP-TO-
DATE ON TRENDS IN THE BRANDS
NOW BEI NG EXPANDED OR
REDEPLOYED?
Y.C. : These companies
are investing selectively
after restructuring their
organizations for maxi-
mum efficiency, and defi-
ning their profitable
growth models. Donna
Karan is returning to
profitable growth. Fendi
continues to demonstrate
its creativity and to
invest in the quality of
its retail network in
order to face the future
on a solid foundation.
Celine’s performance
clearly reflects its new
growth momentum.
Finally, in 2003, several
smaller brands have
taken off. For example,
Marc Jacobs, Berluti,
and Pucci (with strong
increases in net sales
since they entered the
Group) all reported
exceptional growth.
STRATEGY AND OBJECTIVES
I nterview with Yves Carcelle,
President of the Fashion
and Leather Goods business group
HIGHLIGHTS
■Louis Vuitton
recorded double-digit
organic growth, with
an unusually strong
performance in the
United States and China.
This performance,
combined with excep-
tional profitability,
gives Louis Vuitton
even more of an edge
in its market.
■The other brands
of the business group
proved highly resilient
in an unusually tough
economic climate.
Celine turned in an
excellent performance,
driven by the success
of its new products.
Marc Jacobs, Pucci
and Berluti all reported
double-digit organic
growth.
■In 2003, Louis
Vuitton established
a presence in India
for the first time, in
New Delhi, and opened
a store with a new
design in the Roppongi
Hills district of Tokyo,
the center of the
city’s night life. In
February 2004, the
brand opened its largest
store in the world on
Fifth Avenue in New
York, where it laun-
ched its new Damier
Géant luggage line on
an exclusive basis.
■Two talented desi-
gners have joined the
group. Antonio Marras
will be in charge of
revamping the Kenzo
women’s ready-to-wear
line, and Ozwald Boateng
was named Artistic
Director of the Givenchy
men’s ready-to-wear
line.
EUR million 2001 2002 2003
Net sales 3,612 4,207 4,149
I ncome from operations 1,274 1,280 1,311
32 LVMH ANNUAL
REPORT 2003
LF
&
EATHER GOODS
ASHION