Nicola Sabatelli’s Post

Hermès 2024 Half-Year Results: Robust Growth, Strategic Expansion, and Sustainable Innovation Here are the key points from the Hermès 2024 Half-Year Results Presentation, focusing on opportunities and growth: 1. Performance and Growth 1.1 Revenue and Financial Performance: -Revenue reached €7.5 billion, marking a 15% increase at constant exchange rates. -All regions posted double-digit growth, with notable performance in Japan (22%) and the Americas (13%). 1.2 Product Categories: -Significant growth in Leather Goods and Saddlery (19%), and Ready-to-Wear and Accessories (15%). -New product launches across various categories, including watches (Hermès Cut) and the eighth Haute Bijouterie collection. 2. Opportunities and Development 2.1 Production Capacity Expansion: -Four new leather goods workshops in France scheduled from 2024 to 2027. -Strengthening investments in all métiers, including metal pieces, perfume & beauty site expansion, and tableware site expansion. 2.2 Distribution Network: -Opening of new stores in strategic locations like the United States, China, Japan, and India. -Expansion and renovation of existing stores in key markets, including France, China, and Malaysia. -Continued investment in a multi-local and omnichannel distribution network. 3. Employment and Responsibility 3.1 Job Creation: -Total employees: 23,242, with 14,320 in France. -Commitment to local production and training with 60 sites in France. 3.2 Sustainability Initiatives: -Reduction in greenhouse gas emissions between 2018 and 2030. -Continued investments in water treatment and eco-design practices. -Achievement of various sustainability certifications and accolades. 4. Future Outlook 4.1 Strategic Goals: -Despite global economic uncertainties, Hermès remains confident in achieving ambitious revenue growth. -Ongoing strategic investments in production, distribution, and sustainability. -Plans to further integrate the Middle East into their operations and market presence. 4.2 Innovation and Creativity: -Continuous enrichment of product collections, including new launches in perfume, tableware, and home collections. -Emphasis on maintaining creativity and uniqueness in their product offerings and market approach. These points highlight Hermès' robust growth, strategic opportunities in production and distribution, and commitment to sustainability and innovation. #Hermès #luxury #kellymini #Hermèskelly #Hermèsbirkin #Hermèsbag #leathergoods

We are pleased to release Hermès International (RMS PA) Equity Research produced by the CUIRS Global Equity Team. [If you would like to receive the full version of this report, please comment on your email address below] Hermès International is the top player brand in the luxury class, with a diverse product portfolio of 19 product categories across leather goods, furniture, shoes, jewelry etc. Hermès employs a focused and high-end business model, prioritizing premium price points and capitalizing on its most profitable product category. This approach warrants a brand premium that allows the brand to achieve the highest margins among its industry peers. Amid a highly uncertain economic condition and a slowdown in the global economy, the personal luxury market appears to be resilient and robust, seeing a further growth acceleration coming on the heels of the V-shaped rebound enjoyed in 2021. As the leading player in the personal luxury industry, Hermès International is expected to maintain its top-tier position and benefit from the growth momentum and strengthening profitability. Potential upsides were identified in this report, including strong demand in China market, increasing cohort loyalty that contributes to a “Hermès bag drought”, unparalleled craftmanship spirit, and diversified product portfolio, are expected to drive long-term revenue growth. The team conducted 3 statement projections and P/E multiple valuation methodologies to assess the reasonable target price of the firm. We initiated a “Over-weight Rating” of Hermès International at € 2255 Target Price Per Share with a potential +24.6% upside, reflecting the leading position of Hermès International in personal luxury industry. Overview of the complete version of this report: (1) Investment Thesis (2) Financials and Valuation Analysis (3) Industry Analysis (4) Competitor Analysis (5) Company Profile (6) Product Analysis (7) Appendix Credit to Reyna Kao, Andy Chan, Richard Lo, Charlie Lin, and Yin Feng Quah. Also stay tuned for our future publications! #studentsociety #cuirsinvestmentresearch #HermèsInternational #luxurymarket #equityresearch

What we could all learn from Hermès’ marketing strategy. Last week, my wife passionately explained the rationale behind her all-too-frequent trips to Hermès. According to her, the little orange bags that keep mysteriously appearing in the closet are actually part of a greater investment strategy. They are, in fact, part of a wider ploy to acquire the “ultimate investment”. A bag that almost doubles in value as you walk out of the door due to its rarity. It made me consider the extent to which Hermès has mastered the art of scarcity marketing and exclusivity. Through premium positioning, limited production and controlled distribution, the brand has created the ultimate desirability around its products; the Birkin bags are no longer just accessories; they have become symbols of exclusivity. There are lessons that every business could learn from Hermès about the power of the brand and creating desire. Whether it's products, services, members’ clubs or restaurants If a product is high quality but the supply is limited, the natural human response is a sense of urgency and desire, creating an unmatched level of brand loyalty. I can't wait to see how much out of an "investment" this pans out to be 👀 #marketing #strategy #luxury #luxuryfashion

I would like to express my heartfelt gratitude to the Vijay Tandon for their invaluable teachings in Luxury Marketing. Their insights have provided me with a comprehensive understanding of the subject. Would like to share the Ethical and sustainability of Cartier ✨ Exploring Cartier's Ethical and Sustainable Journey ✨ In the ever-evolving landscape of luxury brands, consumers are increasingly prioritizing ethical and sustainable practices. Let's take a closer look at how Cartier, a renowned name in the world of high-end jewelry and watches, is aligning itself with these values. 🌍 Environmental Stewardship: Cartier has made significant strides in minimizing its environmental impact. From responsibly sourcing materials to implementing eco-friendly production processes, the brand is committed to preserving the planet for future generations. 🤝 Ethical Sourcing: Transparency is key, and Cartier understands the importance of ethically sourcing materials. By adhering to strict ethical standards, the brand ensures that its supply chain is free from exploitation and promotes fair labor practices. 💎 Craftsmanship and Quality: Cartier's commitment to excellence goes beyond aesthetics. The brand's dedication to craftsmanship ensures that each piece is made to last, discouraging the disposable culture often associated with fast fashion. 🌱 Sustainable Innovation: Innovation plays a crucial role in sustainability. Cartier has been actively exploring sustainable materials and technologies, pushing the boundaries of traditional craftsmanship to create products that are both luxurious and environmentally responsible. 🔗 Community Engagement: Beyond its products, Cartier is engaged in initiatives that give back to the community. Whether it's supporting local artisans or contributing to social causes, the brand recognizes its role in fostering positive change. 🔒 Transparency and Accountability: Cartier understands that building trust requires transparency. By openly sharing information about its practices, the brand invites scrutiny and accountability, demonstrating a commitment to continuous improvement. In conclusion, Cartier's journey towards ethical and sustainable practices reflects a dedication to not only creating timeless and exquisite pieces but also to doing so responsibly. As consumers, let's applaud and support these efforts, encouraging more brands to follow suit in building a more ethical and sustainable future. #Cartier #Sustainability #EthicalBusiness #LuxuryBrand #CorporateResponsibility #TransparencyInBusiness

OOPS!....THEY DID IT AGAIN Hermès didn't disappoint with its performance in the first quarter of 2024, as indicated by the robust growth in various metrics across different regions and sectors. Here's a summary: 📈 Overall Growth: Hermès reported a substantial increase in consolidated revenue, amounting to €3,805 million for Q1 2024, marking a growth of 17% at constant exchange rates and 13% at current exchange rates. 🌍 Geographical Performance  - Asia excluding Japan saw a growth of 14%, despite softer traffic in Greater China post-Chinese New Year. Notably, a new store opened in Wuxi, China.  - Japan experienced exceptional growth of 25%, driven by strong local customer loyalty.  - Americasenjoyed a 12% growth, bolstered by activities in the United States, including a travelling exhibition and a special event in Los Angeles.  - Europe excluding France and France both recorded solid growths of 15% and 14% respectively, with notable events in Paris enhancing the brand's presence. 🛠 Sector Performance:  - Leather Goods and Saddler sector grew by 20%, with ongoing expansion plans including several new workshops in France.  - Ready-to-Wear and Accessories saw a 16% increase, with positive reception to the Spring-Summer 2024 collections.  - Silk and Textile continued its upward trajectory with an 8% growth, supported by renewed creativity in its collections.  - Perfume and Beauty grew by 4%, continuing its innovation with new product launches.  - Watches also grew by 4%, marked by the debut of a new watch at the Geneva Watches & Wonders exhibition.  - Other Hermès sectors including Jewelry and Home, surged by 25%, showcasing strong creative output. 💚 Sustainability and Corporate Responsibility: Hermès remains committed to a responsible and sustainable model, contributing to community initiatives and environmental conservation, including a significant investment in decarbonization and support for biodiversity. 💹 Financial Health: The company is financially robust, with significant profit-sharing and bonuses distributed to employees, demonstrating its commitment to sharing the fruits of its success. #hermes #luxury #luxuryindustry #performancd

Great news about Hermès H1 Results showing consolidated revenue up by 15%. Even better news is their leather and saddlery goods have lifted the results. Last year Hermes opened a new leather goods workshop in Normandy, France, creating 280 new jobs. In the words of CEO, Axel Dumas “The group is confident in the future and is continuing to invest, to pursue its vertical integration projects and to create new jobs, while remaining true to its values.” #ItsALongStory #leathernaturally #sustainableleather #styleevolution #LeatherCraftsmanship #SustainableFashion #leatherlegacy #vintage #FashionJourney #LeatherLove #digitalstorytelling #emotionalstorytelling #WorldLeatherDay #Leather #LeatherWork #RepairReuseRepurpose #Repair #Repairs #Reuse #Repurpose #LastsForLife #Fashion #ClimateChange #leatherrepair #repairability #ReduceConsumption #LeatherUsage #sustainabilitymatters ⁠

Hermès: Mastering Exclusivity Through Strategic Scarcity Hermès stands out in the luxury market by embracing a powerful . strategy: 𝐋𝐢𝐦𝐢𝐭𝐞𝐝 𝐩𝐫𝐨𝐝𝐮𝐜𝐭𝐢𝐨𝐧. By controlling supply, they create an aura of scarcity and desirability. This isn’t just a business tactic – it’s an art form. Hermès also taps into behavioural science to drive growth and demand. 📢 Hermès produces only a small number of their coveted products. 📢 This fuels a fierce desire among customers. 📢 The Birkin bag is a prime example. 📢 Customers eagerly wait, often for years. 📢 Owning a Hermès product becomes a symbol of status. How Hermès uses behavioural science: 🔔 People value things more when they perceive them as scarce. 🔔 The long waiting list and high demand create a perception of value and desirability. 🔔 The high price of Hermès products sets a standard, influencing perceptions of worth and status. 🔔 The longer customers wait, the more they value the product when they finally own it. This approach isn’t just about selling bags; it’s about positioning itself as a symbol of class and exclusivity. Hermès transforms each item into a piece of history, a status symbol like no other. Their strategy is a brilliant blend of artistry, business acumen, and behavioural science. It's why Hermès continues to shine in the luxury market. #Luxury #Exclusivity #BusinessStrategy #Hermès #Desirability #BehaviouralScience #LuxuryMarket

There are two ways to fail in life—try to please everyone or try to please no one. And that's precisely the function of a brand's positioning —to find a little corner of the market where the brand can serve the needs of a particular group better than anyone else. But notice I said a "certain group" and not "everyone who wants it." At a time when brands seem willing to shift focus at any moment, Hermès shows what commitment to positioning is—unparalleled luxury and elegance.  Hermès risks short-term gains losses, public scrutiny and a potential image crisis to keep the promise that the brand is only for a select few. We may disagree and argue against it, but we can never say Hermès has no integrity (what they think, say, and do are always aligned) when managing their brand. #brand #branding #brandmanagement #brandstrategy

✨ Hermès stands as a paradigm of luxury, redefining the industry with a unique approach that encompasses their entire supply chain, design philosophy, and retail strategy. This distinctive #strategy has not only set them apart but has also propelled them beyond corporate giants like Nike in market capitalization. 🔑 Key Insights: 📈 Over the course of just 30 years, Hermès has witnessed a phenomenal growth trajectory, seeing their share value soar from €6 to €2,000, a company worth now valued at €210 billion. 💥 The core values of #quality and #exclusivity form the bedrock of Hermès' success. Unlike many other luxury brands, Hermès doesn't rely on celebrity endorsements. Instead, they thrive on the discreet prestige garnered through word-of-mouth recommendations. 🤝 A notable element of their strategy is the empowerment of store managers, allowing them a significant degree of autonomy. This approach has played a pivotal role in their exceptional #success. 🚀 The numbers further underscore Hermès' #achievements. They rank third in luxury revenue globally, boasting a remarkable 40% operating margin, and have demonstrated resilience even during economic crises. 💡Looking ahead, Hermès faces challenges in scaling their unique business model, navigating the resale market, and adapting to the ever-evolving digital landscape. Yet, diversification remains the key to securing their future in a competitive and dynamic luxury market. #ClientSuccess #OverTheReality #BusinessAchievements #FashionInnovation #FashionTechHub #SuccessStories

“Against formidable odds, the heirs repulsed Arnault’s advances, handing one of France’s most acquisitive businessmen a stunning defeat and preventing Hermès from becoming just another label in LVMH’s stable of about 75 brands that includes Louis Vuitton and Christian Dior. Since that October day 13 years ago, Hermès International SCA shares have risen more than 1,000%, smashing the 600% gain at LVMH. Hermès’ market value has soared to more than €200 billion ($216 billion), about 60% of LVMH’s — with roughly one-seventh the revenue. Once vulnerable to predators as complacent family members got involved in other endeavors, Hermès’ success has provided the group its best defense. It has made the family, which now counts more than 100 members, Europe’s richest, with a combined fortune this year of about $151 billion, according to the Bloomberg Billionaires Index. That’s up about 59% from last year, making it the world’s third-wealthiest and putting it ahead of the US’s Mars and Koch clans, the House of Thani — the ruling family of Qatar — and the Al Sauds of Saudi Arabia. (…) Hermès is by far the luxury sector’s best performer this year, with a 35% gain in its shares, compared with a 5.3% rise for LVMH and a 15% slump at Gucci-owner Kering SA. Most industry analysts still rate Hermès a “buy,” “hold” or “neutral.” But with the stock trading at a multiple more than double that of its peers, the market slump may eventually catch up with it, said Jelena Sokolova, an analyst at Morningstar. “I wouldn’t say that deceleration is completely unthinkable for Hermès,” she said. Morningstar has one of the few “sell” ratings on the stock because it’s considered expensive relative to future earnings.”