Millward Brown

Keeping luxury a family business

Isaac Mostovicz writes...

Is it personal investment and independence (by the designer or the founding family) that makes a luxury brand special? Such is the suggestion of this article in Forbes last week. Recently Millward Brown, a market research company owned by WPP, put together a list of the world’s most powerful luxury brands using WPP’s Brandz database, which according to the article is the world’s largest repository of brand equity data, including over a million interviews with consumers about their attitude towards brands.

Louis Vuitton was on top, but there were several companies on the top end of the list (including Armani and Hermes) that are private or still have a family as a primary shareholder–by having a majority or entire stake in the company, these companies can focus on quality and design without having shareholders breathing down their necks about higher profits.

There’s also a nice quote about the longevity of luxury from Nikhil Gharekhan, senior vice president at Millward Brown:

Luxury brands do very well because they command high levels of emotional loyalty. They ensure that the loyal customers are going to come, and, therefore, revenue stream is assured. Even in times of recession these brands don’t cut costs; they continue to deliver top quality. It’s almost a justification to splurge on these brands.

Forbes also has a slideshow of some of the luxury brands on the list here.

Do private luxury brands have an advantage over their public peers?

[Photo by Donna Grayson]

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