Between capital movements and a new international order, major brands are banking on iconic locations to capture attention, particularly in China.
These moves also reflect a desire for renewal and adaptation in a rapidly changing sector.
Luxury reinvents scarcity
In China, where sales of personal goods fell by nearly 18% last year, brands are opting for immersion: cafés, exhibitions, VIP areas, beyond traditional retail. These investments signal a desire to reinforce exclusivity, stimulate footfall and anchor the myth in a powerful physical location. Experience is becoming the new currency of luxury when the market stagnates.
In Shanghai, Louis Vuitton has just unveiled “The Louis,” its ultimate flagship store in the form of a 30-meter-high, 114-meter-long ocean liner.
Built like a majestic ship, this spectacular building houses three levels of experience: the “Visionary Journeys” exhibition, a boutique, and a gourmet café. The inauguration on Nanjing Road is as much an architectural statement as it is a tool for regaining ground in a declining Chinese market.
The Middle East, the new haven for luxury
While traditional markets are showing signs of slowing down, particularly in China and the United States, the Middle East is emerging as a strategic anchor. In 2024, sales of luxury goods in the region grew by 6%, reaching nearly $12.8 billion. This momentum is driven by both a highly consumptive local clientele and booming intra-regional tourism.
Major groups such as LVMH and Richemont are stepping up their initiatives in the Emirates and Saudi Arabia, with ultra-modern boutiques, cultural partnerships, and hotel diversification. Bulgari Hotel, for example, is set to open its next hotel project in Abu Dhabi, further strengthening its presence. In addition, the Michelin Guide will now cover Saudi Arabia, reflecting growing interest in the region’s gastronomic scene.
While regional geopolitical tensions remain an unstable variable, this growth reflects a rebalancing of geographical priorities. In this complex regional context, France is maintaining an active diplomatic role, seeking to stabilize a strategic area for trade and investment, thereby highlighting the geopolitical importance of the Middle East for luxury players. Are luxury brands now betting on this region to offset declines elsewhere?
A sector on the move
This week also marks the continuation of strategic changes at several major luxury and prestige companies. Eric Valla, for example, is taking the reins at Lacoste, promising a new era for the iconic French brand. Meanwhile, the departure of Anna Wintour from Vogue USA signals a profound change in the world of influential luxury media. The former boss of Ferrari joining McLaren illustrates the dynamics of mobility and competition in the high-end automotive sector.
Meanwhile, under the control of Auriel Investment (Hussain Sajwani), Italian fashion house Roberto Cavalli is up for sale or seeking investors through “strategic partnerships”: an essential financial repositioning, combined with the ambition to preserve its flamboyant DNA intact. Cavalli illustrates the urgent need for independent brands to capitalize in order to survive.
Finally, hedge fund Parvus Asset Management has increased its stake in luxury group Kering to 5%. With Kering having just announced the arrival of Luca de Meo, former CEO of Renault, at the helm in September, this increase is likely to stimulate, if not a revolution, then at least a shift in strategy.
