According to the latest Brand Finance report, the world’s top 50 luxury brands have lost $7.6 billion in value this year. This was due to the results of the economic fallout from the Covid-19 pandemic.
This Brand Finance report estimates that the value of the top 50 luxury brands has fallen by over 3% year-on-year, from $227.1bn in 2020 to $219.5bn in 2021.
Brand Finance also tells us that fashion brands dominate the rankings negatively: 30 apparel companies, representing 62% of the total, have been hit hard by the negative effects of Covid-19 on the sector. Leather goods brand Coach recorded the biggest drop in value, down 31% to $4.7bn.
Commenting on the results, Alex Haigh, Director of Valuation at Brand Finance, said: “There may be a silver lining in this bad news. The pandemic could be used as a catalyst for change in the sector and encourage retailers to strengthen their e-commerce offerings or respond to growing consumer demand for social and sustainable actions.”
Luxury brands have been particularly challenged by government decisions to address the global pandemic. But they have coped by adapting and innovating. Nevertheless, some luxury brands have managed to get out of the water quite quickly and achieve more than satisfactory financial results in the midst of the health crisis.
Porsche, for example, has grown by 1.2% and its total brand value is now $34.3 billion. These results can be justified by the success of the investment in electric vehicles.
Another car manufacturer did the same: the Italian brand Ferrari, which grew by 2% to $9.2 billion. Watchmaker Rolex also recorded an increase of 0.8% to $7.9 million.
Finally, Celine was the fastest growing brand in the report. It moved up from 34th to 13th place, growing by 118% to a total value of $1.5 billion.
These financial results are hopeful for the other brands that have been experiencing a downward trend, especially with the health situation tending to improve in recent times.
Read also > THE LUXURY SECTOR: AN END TO THE CRISIS BY THE END OF 2021?
Featured photo : © Getty Images
