If there is just one single case study in luxury management that needs to be taught in any business school, then it would be LVMH. Not so much for the magic of revitalizing wearied brands, but more for consistently aligning powerful marketing decisions with financial engineering. And what the group can’t achieve from scratch, they’d just buy the necessary competencies. The watch business unit — which is, in fact, under one roof with the jewelry — is no exception to the rule.
Even though watches are by far not the main business unit within the LVMH empire, its importance is growing. As of today, LVMH’s main watch brands and the jewelry brands also propositioning watches account for ~6% of the group’s sales and ~4% of its EBIT. Comparatively, Louis Vuitton Horlogerie represents not even 1% of the brand’s sales*, which not only indicates significant latent potential, but also that taking any bold moves — such as repositioning the watch offering at a much higher price point — doesn’t put the brand at risk.
MODEST ORIGINS IN A NEW CATEGORY OF PRODUCTS
In 1995, LVMH bought Fred Joaillier; this is followed in 1999 by Chaumet, Ebel, TAG Heuer and Zenith. Bulgari’s watches — which account for ~12% of the brand’s total sales — are very successful, though not to the same extent as the jewelry, and are a good example of the group’s long-term vision. Nevertheless, the group hasn’t yet fully achieved what it needs to build up a leading position in the watch business.
As of 2022, the market share of the five brands selling watches accounted
