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The World’s Top 50 Luxury Brands Lost $7.6 Billion in Value This Year, a New Report Says

Collectively plummeting by more than 3 percent year-on-year.

--FILE--A pedestrian walks past the Maison Hermes in Shanghai, China, 16 September 2014. Thriving demand in China boosted first-quarter sales at Birkin bag maker Hermes, underscoring an upbeat start to the year for some of the luxury sector's biggest names. From fashion labels to jewelers, many players in the industry have reported better-than-expected sales at the start of the year, with strong demand from Asian and US shoppers. Hermes, known for its ,000-plus hand-stitched Birkin and Kelly bags, said revenue rose 11 percent on a constant currency-basis from a year earlier, more than analysts had forecast.  (Imaginechina via AP Images) Zhou junxiang

According to a new report published by Brand Finance, the world’s top 50 luxury and premium brands have lost a collective $7.6 billion in value in the past year amid Covid-19’s economic fallout.

The value of the top 50 brands plummeted by more than 3 percent year-on-year, from $227.1 billion in 2020 to $219.5 billion in 2021. While fashion labels dominate the list, with 30 apparel companies accounting for 62 percent of the total, the majority struggled amid the pandemic and reported losses. Coach recorded the biggest drop in brand value, falling 31 percent to $4.7 billion.

Brand Finance

Brand Finance

It’s not all bad news, though. A handful of high-end heavyweights actually managed to stay in the green. In pole position, Porsche actually grew 1.2 percent and now has a total brand value of $34.3 billion. That’s likely due in part to the automaker’s successful inroads into electrification. The marque sold 20,000 models of its popular all-electric Taycan last year, outperforming the 911 in the US despite a six-week pause in production.

Similarly, Ferrari jumped up 2 percent to $9.2 billion while Rolex crawled up 0.8 percent to $7.9 million. Coincidentally, the two luxury titans were also named the most trusted brands in the world earlier this year.

2022 Porsche Taycan

The 2022 Porsche Taycan.  Porsche

Another brand bucking the downward trend was Céline. As the fastest growing luxury outfit on the list, the label soared from 34th position up to 13th and grew 118 percent for a total brand value of $1.5 billion. That can be largely accredited to the house’s formidable creative, artistic and image director Hedi Slimane, who has managed to attract Gen Z shoppers across the Asian market while continuing to appeal to the core clientele.

According to Brand Finance’s valuation director Alex Haigh, there may be a silver lining to overarching bad news. He says the pandemic could be used as a catalyst for change across the sector and encourage retailers to bolster e-commerce offerings or cater to the growing consumer demand for social and sustainable action.

 

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