Rich people no longer retaliate by purchasing luxury goods, at least according to financial reports.

Recently, with top conglomerates releasing their third quarter financial reports, luxury goods have taken the lead in the winter. Kaiyun Group's revenue plummeted by 13%, with its brands Gucci, YSL, and Bottega Veneta suffering one by one.

LVMH has reached its worst level in three years: it only grew by 9%, and after deducting the impact of exchange rate fluctuations and acquisitions, total revenue only increased by 1% year-on-year. Compared to the double-digit high growth in the previous two years, this financial report is clearly disappointing.

Sharp investors had already anticipated this and cashed out early: since April this year, LVMH's market value has shrunk by about 96 billion euros. Last month, it was just taken over by weight loss drug manufacturer Novo Nordisk as the most valuable company in Europe.

Regarding this, the Chief Financial Officer of LVMH can only politely say: bidding farewell to the three glorious years, our growth is approaching the historical average level.

Similarly, a group of luxury cars and famous wines have also awakened from their dreams: Rolls Royce's delivery volume has decreased by 9% year-on-year; Porsche rarely encountered a cold reception in China, with sales declining by 12%; Hennessy's price increase also made it difficult to sell, with LVMH's wine and spirits division experiencing a 14% drop in performance.

Why is the luxury goods boom that erupted after the pandemic just a flash in the pan, as the performance of luxury goods groups has been declining hand in hand?

Luxury goods do not deceive the poor

In the past three years, the craziness of the luxury goods market has been almost entirely attributed to the top wealthy.

LVMH, Kaiyun, and Herm è s are all running at double-digit annual growth rates. In 2022, LV alone sold 20 billion euros; Gucci has entered a club worth billions of euros, along with Kaiyun Group's revenue exceeding the 20 billion euro mark; Herm è s revenue in the Asia Pacific region has nearly doubled in three years.

When Pinduoduo and premium brands raise the banner of "consumption downgrade" and make a lot of money, luxury brands go the opposite way - achieving explosive performance by raising prices.

Between 2021 and 2022, 70% of the growth in leather goods sales was driven by price increases. Luxury brands use price increases to persuade the poor and screen the truly wealthy.

The top players should be like LV and CHANEL, with the former raising prices three times within a year, with a single increase of up to 15%; The latter has seen a three-year increase of over 60%, with a lower yield than many stock funds.

LVMH high-profile abandons the "low-income group" with an annual income of less than 3 million; Gucci and Dior are competing to launch VIP exclusive "small black houses"; Herm è s has quietly raised the threshold for distribution and wants a platinum bag? Buy more scarves and wallets first.

LV has raised prices again this year

Noble like Rolls Royce, it also achieved record profits with more expensive customized services.

Last year, while waiting in line for a car, the new elites boosted Rolls Royce's sales by 6021 units; At the cost of paying an additional 500000 euros for the custom-made Rolls Royce, Rolls Royce's profits increased by 57%, reaching 652 million pounds.