LIVE MARKETS-Europe's 'big 5' luxury brands may lose market share again in 2025-MS

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EUROPE'S 'BIG 5' LUXURY BRANDS MAY LOSE MARKET SHARE AGAIN IN 2025-MS

Europe's top five luxury brands saw their market share fall in 2024 for the first time in years, and the trend is set to continue in 2025, according to Morgan Stanley analysts.

"For more than two decades, the largest luxury brands have been gaining market share, leading to a polarisation of the sector," they write in a note.

MS says the Big 5 - namely Louis Vuitton, Chanel, Hermès, Dior, and Gucci - captured a disproportionate share of industry growth during the past decade.

In fact, between 2016-2024 the they accounted for about 72% of industry growth and 82% of profit growth, as per MS analysis.

"However, for the first time in many years, the leading brands actually lost share (on aggregate)."

Last year, those top five players' share of the market (which MS defines as the top 20 players) stood at 69%, down from 71% in 2023.

Their combined sales fell 3% to €74.5bn, with some particularly steep drops for Dior and Gucci sales, which were off 10% and -23% respectively, according to MS estimates.

And while the trend of big players' market share fall is set to continue this year, MS does not think the the highly-polarised industry will become more fragmented.

Why? Well for one, they think the long-term competitive 'advantage of scale' is very significant for these big players.

Also, Chanel, Dior and Gucci have recently experienced changes in their creative teams, which MS says should "hopefully lead to some improvement in commercial performance."

(Lucy Raitano)

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