French luxury goods industry (2015)
- 130 brands
- 51,000 employees in Comité Colbert companies,165,000 employees in the luxury world
- 35 sectors, global leader
- Turnover: USD49.875 billion for the 10 French companies in the top 100 worldwide
- Turnover: €42 billion for Comité Colbert companies
- Export: an average of 86% of turnover from Comité Colbert companies
It is difficult to qualify the luxury goods market, which encompasses tourism, haute couture, leather goods, jewellery & watch-making, perfumery, tableware, the automotive sector, yachts, works of art, gourmet cuisine, fine wines and spirits!
Bain & Company with Altagamma (Italian association of luxury market professionals) estimates that global turnover from luxury goods amounted to €224 billion euros in 2014, i.e. a 3% growth in one year (13% at current exchange rates). But tourism is responsible for 50% of the sector's global spending.
Based on the 2013 fiscal year of the 100 leading players in the global luxury sector, Deloitte announced that sales generated by this top 100 are USD214.2 billion, which is a rise of 8.2%.
This analysis is based on the four main categories in the luxury industry. By category, the hit parade of sales generated by these 100 companies puts multiple luxury products in the lead (31.9% with 10 companies), ahead of jewellery and watchmaking (26.3% with 31 companies), fashion (18.4% with 36 companies), perfumery-cosmetics (16.1% with 11 companies) and bags and accessories (7.3% with 12 companies).
This market represents around 330 million consumers and gains 10 million new customers each year. The Americans form the biggest number (90 million customers), followed by countries of Western Europe (80 million) and the Japanese (35 million customers). And Chinese customers are increasingly drawn into the world of luxury when they travel outside of China!
Despite the growth of luxury markets in new economies, European brands continue to exercise their power and influence in the luxury goods world.
French leader LVMH, which is present in six sectors, represents 70 different companies, each with their own strong identity (Louis Vuitton, Marc Jacobs, Loewe, Christian Dior, Berluti, Moët et Chandon, Hennessy, Guerlain, Chaumet, Bulgari, etc.). Number one in the luxury goods universe, its sales amounted to USD21.7 billion in 2013, ahead of Swiss group Richemont (Cartier, Lancel, Chloé, Van Cleef & Arpels, Montblanc, etc.), which recorded turnover of USD13.4 billion. The American Estée Lauder, a cosmetics specialist, totalled USD10.9 billion in sales in 2013 and takes third place, ahead of Chow Tai Fook Jewellery Group from Hong Kong. French group Kering (Gucci, Bottega Veneta, Saint Laurent, etc.) takes seventh place in the ranking (USD8.6 billion) and L’Oréal is placed eighth, with turnover of USD 7.9 billion.
The 10 French companies in this top 100 have joint turnover of USD49.875 billion. To make it into this select top 100, minimum turnover is USD142 million! With three companies, France generates 41.9% of the accumulated turnover of the top 10.
The French luxury industry dominates the global market with 130 prestigious French brands out of a total 270 in the world. In 2015, the prestigious Comité Colbert associated 81 luxury member companies, which represent accumulated turnover of €42 billion, an average export rate of 86% and 51,000 jobs.
In terms of wines and spirits, in 2015 the Fédération des exportateurs de vins et spiritueux de France (FEVS – Federation of wine and spirit exporters of France) recorded a growth in turnover of nearly €1 billion compared to 2014. For ten years, on average, wines and spirits have represented an export figure which equates to3 140 Airbus planes per year (Source: FEVS)! Champagne recorded income of €4.75 billion in 2015, but with a global volume of 312.5 million bottles in 2015 compared to 339 million in 2014. The increase in the price of Champagne in 2015 did not have any harmful effect on non-European exports, with 70.5 million bottles sold outside of Europe. Cognac also fairs well in non-European exports, with only 1.96% of sales in terms of bottles generated in France at the end of January 2016.
SECTOR CHALLENGES RELATING TO PACKAGING
- The French luxury goods industry is based on manual and artisanal know-how, the opposite to industrial production. Legacy, tradition and excellence are sometimes combined with cutting-edge machinery in order to remain competitive. This industry is embracing the ICT revolution and paradigm changes of consumption models, without moving away from its values. On the model of clienteling (establishing long-term relationships with customers), the questions are: how to square viral marketing and uniqueness, how to offer a unique purchasing experience, how to improve the customer experience using packaging as a vector of values, of the brand?
- Noble or unusual materials, cutting-edge or ancestral technologies, relayed by technical and qualitative sleights of hand, form the foundations of luxury goods packaging. The displays in luxury boutiques go hand-in-hand with packaging.
- Nowadays, in the mass market, the way in which a product is unpacked and the content used must tell a story, an experience. A unique sensory, and even ceremonial experience is ingrained in brand culture and in luxury codes and quality. This experience still needs to be invented for shipping packaging for luxury products purchased on-line.
- Internet is also developing a market estimated4 at €16 billion in 2014 (7% of the global luxury market), where second-hand luxury customers can monetize their products and fund their new luxury purchases (Source: Bain &Company). Exane BNP Paribas estimates that the highest demand concerns small leather goods and especially the brands Louis Vuitton, Chanel, Hermès, Dior and Céline. Sites like Vestiaire Collective.com are becoming 2.0 second-hand stores and other sites which hire out these luxury products are multiplying. Although sealed in new packaging before being shipped to the customer, this packaging does not have any luxury attributes.
- 3D printing allows products to be ultra-customised with complex shapes and rapid production. It is without doubt an opportunity for the luxury sector to create unique high value-added packaging for a unique customer.
- In the realm of alcoholic drinks, more and more premium gift sets are designed to be kept by the consumer and to initiate them in a tasting experience. Some of these gift sets, once empty, can become objects of art. Inversely, some sleeves for bottles, the lifespan of which is shorter, are eco-designed with materials from renewable natural resources.
- In fact, the luxury sector is associating "durability" and glamour with lighter packaging, such as the Champagne bottle, whose carbon footprint has been minimised, and it is promoting natural materials such as wood, which is currently considered a must-have.
- Lastly, the luxury cosmetics sector is also following the trend for packaging which delivers the correct amount of product and it is accompanying globe-trotting customers with smaller product sizes.
"The Odyssey of a king": a unique assemblage of Louis XIII cognac and Grande Champagne brandy by Rémy Martin in a carafe made of hand-blown glass by Saint Louis, presented with engraved crystal glasses and a Puiforcat white gold pipette, in a leather case hand-made by Hermès. An ode to French know-how available in three cases which will be auctioned, with the money going to the Martin Scorsese Foundation.
Moët et Chandon has named its prestigious cuvée MC III. Presented in a bottle with a flat silver base engraved MC III, it features a minimalist design with a metal cap. The metal, the wood and the glass of the packaging symbolise this Champagne made from three grape varieties and rare and unique Champagne wines.
Louboutin, the famous shoe-maker for celebrities, decorates nails in its new "Scarabée" nail polishes, in unique and changing shades. Limited edition. The bottles are topped with golden caps in the shape of high heels, which invite the user to transform the application gesture into a refined experience. The patented triangular brush takes up just the right amount of polish, which is protected like a sacred amulet.
Mumm launches its connected "Cordon Rouge" bottle. An RFID chip and a geo-tracking sensor integrated into the bottle's collar trigger, upon opening, a signal which changes the sound and lighting. Opening the bottle triggers the chosen music to create an environment with muted lighting or a more electric mood. It's up to you to programme your moods.
"Décadence" by Marc Jacobs for Coty is inspired by one of the brand's emblematic bags. The bottle has an arch-shaped cap in exotic python texture and a gold chain with a black silk tassels. The raised gold logo contrasts with the deep emerald green of the bottle. Classicism and irreverence in the image of its designer!
Jacques Guerlain used to walk to the Champs-Elysées boutique to listen to customers and gather their impressions. Today, the customer can choose the colour of the symbolic bee bottle signed "Guerlain Parfumeur", fill it from one of the 18 perfume fountains and even personalise it.
"Bouquet de la Reine" is a unique Guerlain perfume sold to raise funds to restore Château de Versailles. An exceptional four-lobed bottle, created in 1908, protects the perfume, which is available in a limited and numbered edition. This unique form has a 23-carat gold star signed by Haute Couture costume jeweller Desrues and has the emblem of the Sun King.
The limited edition of the "Caviar Spectaculaire" skin caviar cream by La Prairie is nestled in a 75 ml hand-cut crystal cup by Baccarat, which after use transforms into a caviar dish. At the bottom, the new signature of the collection is a cobalt blue ring which is regal and sumptuous: two words which perfectly depict this luxury caviar cream.
AMONG EXHIBITORS IN LUXURY SECTOR:
A3P THERMOFORMAGE / ADL - IDEAL LTD / AIROPACK / CARPENTER - EMBALLAGES TECHNIQUES EN MOUSSES / DISEÑOS NT / DS SMITH / EGISA / ELPLAST, EL-ZIP PRESS TO CLOSE ZIPPERS / EMBALLAGES MARTIN / ETIQ’ÉTAINS / FAG ARTIGRAFICHE / GLORY INNOVATIONS, INC / JEF LIMITED / JSP GROUP / KARBEST / KEENPACK INDUSTRIAL LTD. / LGR PACKAGING / LITOCHAP / MGI DIGITAL GRAPHIC TECHNOLOGY / NO-NAIL BOXES / PRINTPARK PREMIUM FOLDING CARTONS / RPC / TAPI / UNION STREET TIN / VETROELITE SPA.
- About the beauty sector
- About the food sector
- About the beverages and liquids sector
- About the multi-industry sector
- About the health sector
- About the handling and intralogistics sector
Source: Annette Freidinger-Legay, international packaging expert and consultant for the ALL4PACK Paris 2016 trade show.