Louis Vuitton 2006 Annual Report Download - page 48

Philippe
Pascal
President of the
Watches and Jewelry
Business Group
A recent and dynamic player in the watch
and jewelry sector, our business group stands
out in its market due to a very sustained rate
of revenue growth and has significantly
improved its profitability. That profitable
growth is the result of a strategy that focuses
on value growth levers and rigorous manage-
ment. We concentrate energies and resources
on our geographic and operating priorities
while preparing our growth drivers.
Our mission at the brands and in all regions
of the world can be summed up simply:
to seduce consumers and service our retail
clients efficiently. Seduction means innova-
tion, creativity and quality in our collections
and our communications. Effective service
means supporting our aggressive sales efforts
with the best after-sale service and effective
targeting of our marketing investments.
Strategy and Objectives
In 2006, for the third consecutive year, the orga-
nic revenue growth from LVMH Watches and
Jewelry brands has been much higher than that
of its competitors. That growth is balanced
among Europe, the Americas, Asia and Japan,
and every watch and jewelry brand has impro-
ved its performance. The development of new
markets is being actively pursued: the streng-
thening of distribution agreements, with the
acquisition of an equity stake in Xinju Heng-
deli in China, has enabled TAG Heuer, then
Dior Watches and Zenith to gain a visible
presence; the presence of TAG Heuer in India is
today significant; the Middle East and Eastern
Europe are also seeing openings and receiving
targeted investments, both in jewelry and in
watches. The financial recovery of the business
group has continued and has translated into a
281% increase in profit from recurring opera-
tions.
TAG HEUER BOOSTS ITS STAR BRAND STATUS
A record year for the world leader in sports-
inspired watches and chronographs: TAG HEUER
continues to experience remarkable growth in
volume and in value and is strengthening its
star brand status within the LVMH portfolio
and Swiss watchmaking.
2006 was marked by increased revenue in all
markets, continued upmarket positioning and
recognized technological innovation. TAG
Heuer increased its leadership in the market
segment of watches priced between 1,000 and
The most recent of the LVMH Business Groups holds a portfolio of leading
watches and jewelry brands with complementary positionings: TAG Heuer, the
world leader in prestige sports watches and chronographs; Zenith, a watch
manufacturer known for its famous El Primero movement; Dior Watches, with
collections inspired by the designs of the fashion house; Chaumet, the historic
and prestigious jeweler of the Place Vendôme; Fred, the designer of contemporary
jewelry; and Omas, the Italian designer of writing instruments. De Beers*, a
brand developed by a joint venture formed in July 2001, confirms its positioning
as a diamond jeweler and accelerates its expansion.
*De Beers activities, previously consolidated in Other Activities of LVMH, are now integrated in the Watches and Jewelry business group.
44 LVM H 2 0 0 6 WATCHES & JEWELRY
“A strategy
that focuses
on value
growth levers.”