Louis Vuitton 2004 Annual Report Download - page 56

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54
The strategy energetically pursued for two years by the
Watches and Jewelry business group of focusing on a group
of complementary brands, coupled with targeted invest-
ments in the most favorable markets, is showing results.
In a recovering market, the business group posted organic
sales growth of 18% in 2004. All LVMH brands recorded
double-digit sales growth on a constant currency basis, and
strengthened their positions. This greater-than-market
growth was driven by a strong sales momentum in all coun-
tries, the success of the collections launched in 2003 and
2004, and from effective research investments. A refocused
brand portfolio, improved productivity, and the optimi-
zation of a highly entrepreneurial organization improved
financial indicators. The improvement in performance was
particularly remarkable in Asia and the United States, two
regions where investments were increased.
The progress achieved by the teams of the brands and distri-
bution subsidiaries allow the business group to continue
its profitable growth and each brand to expand by
asserting its identity and expressing its creativity. In 2005,
organic sales growth and improved margins continue to
be priorities. Each brand has set a target of greater-than-
market growth. To reach this goal, each company has initia-
ted a plan that combines innovation with stronger icon
product lines. The brands will focus on accelerating the
marketing of new collections to satisfy the expectations of
customers and retailers. Larger investments will be made
in China and Russia, markets that offer strong prospects
for the future growth of the business group.
TAG HEUER
In 2004, TAG Heuer increased its market share and consolidated
its leadership in luxury sports watches and chronographs. The
brand posted a particularly strong performance in the United
States and Asia. The strong growth in net sales and improved
operating margins generated higher results, while allowing grea-
ter investments. As a result, TAG Heuer has joined the group of
LVMH star brands, with the ambition and the means to increase
its contribution.
The launches of Link,Formula 1,2000 and Aquaracer attrac-
ted customers and retailers and drove growth throughout the
year, while the new Carrera model celebrated the 40th anni-
versary of this emblematic line.
Faithful to its tradition as a leading-edge watchmaker, TAG
Heuer also introduced its innovative V4 belt-transmission at
the 2004 Basle Trade Show, an original watch movement
design, unanimously praised by opinion leaders.
A “dream team” of ambassadors who embody
the perfect merger of sports and glamour
In December 2004, Hollywood stars Brad Pitt and Uma Thur-
man joined the team of TAG Heuer ambassadors, alongside
Juan Pablo Montoya, a Formula 1 racing driver for the McLaren
Mercedes team, and Maria Sharapova, the rising tennis star.
This team is the living symbol of the intersection between sports
and glamour, the brand’s target positioning segment, appre-
ciated in all markets. With golf champion Tiger Woods, the
young driver Kimi Raïkönnen and Steve McQueen, the mythic
ambassador for the Monaco chronograph, TAG Heuer groups
together the most extraordinary team of ambassadors repre-
senting a luxury watch brand. Like their predecessors, Brad
Pitt, Uma Thurman and Juan Pablo Montoya not only embody
the TAG Heuer image, but will also participate in product design.
In 2005, TAG Heuer will continue its policy of innovation and
will introduce an automatic chronograph that can measure one
hundredth of a second, and the first golf watch developed with
the collaboration of Tiger Woods.
ZENITH
In 2004, Manufacture Zenith strongly consolidated its position
in the high-end watchmaking sector. By combining cutting-
edge expertise with an aesthetic modernity, the brand has
expanded in all major watch markets, with very strong perfor-
mances in Asia, Japan, and the United States.
The growth in net sales was driven by the success of the Open
collection, an original concept that reveals the inner workings
of the famous El Primero movement, developed for both men
and women, the success of the classic and elegant women’s
automatic watches, and the Haute Horlogerie collection which
includes the first Tourbillons of the brand.
Philippe Pascal, President of the Watches and Jewelry business group
With strong organic sales
growth, sustained innovation
and improved margins, the
Watches a nd Jewelry business
group achieved its objectives and
has the resources to continue its
profitable growth.