Who will be the luxury brand winners and losers?

LUXURY BRANDS

The challenges faced by Mulberry and Burberry last year prove not all premium brands have benefited from the emerging consumer spending boom. Arjen Los, CIO of Dominion Funds, looks at what makes a winner.

There is an emerging theme among leading luxury goods companies: operating a flagship store in China is not enough to be successful. This is because consumers in emerging markets are learning to distinguish the quality of different brands more quickly than their Western counterparts did some 20 or 30 years ago. One factor in this accelerated sophistication is the growth of international travel. Today’s emerging middle class tourist is exposed to the full range of brands the developed world can offer. The behaviour of consumers is converging globally and luxury goods companies are adop...