While many luxury brands are cutting their revenue forecasts, Sephora and similarly situated brands have each posted a string of blockbuster sales results. Estee Lauder, the company that owns its eponymous cosmetics line, as well as brands such as Clinique and MAC, recently upped its sales forecast this spring, in response to experiencing greater demand for its products.
Luxury goods group LVMH will set up a new digital platform to host all of its brands, sources close to the matter told Reuters, as the French company steps up efforts to capitalize on the sector's online sales boom. The internet has become the industry's most important growth engine, with analysts expecting online transactions to represent 20 percent of all luxury sales within a decade, up from 7-8 percent now.
LVMH's online sales of 2 billion euros ($2.1 billion) last year equated to 5.3 percent of group revenue, with only select companies under its umbrella offering goods online. Paris-based Celine, for instance, has shunned e-commerce entirely to date.
"This platform should boost the visibility of the various LVMH brands," which include Louis Vuitton, Celine, Loewe, Marc Jacobs, Givenchy, and Pucci, among others, one of the sources said, adding that the site would also promote other luxury goods brands not owned by LVMH, which is controlled by French billionaire Bernard Arnault.
Leading the initiative will be former Apple executive Ian Rogers, hired by Arnault in 2015 to spearhead digital strategy at the world's biggest luxury goods group. The company's new e-commerce site is due to go live in a few months' time, the sources said. LVMH declined to comment.
The group has already sought to tap into the increasing importance to the industry of online social media platforms by setting up LVMH Luxury Ventures last month to invest in start-up luxury goods projects.
(Writing by Sudip Kar-Gupta; Editing by Dominique Vidalon and David Goodman)