May 30, 2023
Will the Olympic Games make LVMH "a prophet in its own country"?
May 30, 2023
Still "under discussion", LVMH's sponsorship contract for the Paris Olympic Games is still pending, but could represent a great opportunity for the world's number one luxury goods company, which generates 90% of its sales abroad. Is LVMH becoming a "prohet in its own country"?
In April, group CEO Bernard Arnault acknowledged that the contract was “under discussion”, quickly adding: “like any discussion, it may or may not end with a signature”.
“We will continue to negotiate, it can take 15 days as it can take six months”, then detailed Antoine Arnault, director of the image of the group and general manager of the holding company Christian Dior SE, which controls LVMH.
The arrival of the world number one in luxury as a first-tier sponsor, alongside five others who have already signed up (BPCE, Orange, EDF, Sanofi and Carrefour), is eagerly awaited.
According to La Lettre A, the leaders of LVMH “wanted to pay the price of a national partnership while obtaining part of the advantages reserved for international deals” from sponsors such as Coca-Cola, Omega or Airbnb.
The challenge is to show “that luxury in terms of power is the equal of a Coca-Cola”, underlines to AFP Eric Briones, author of “Luxe et Digital”.
For Julie El Ghouzzi, from the consulting agency Cultz, for the time being “LVMH does not have much communication as a group”.
“Partnerships and sports sponsorships are made at the level of its brands”, according to her. For example, Tiffany manufactures the Super Bowl trophy in the United States, Tag Heuer is the timekeeper of the Formula 1 Monaco Grand Prix, and Hublot that of the last football World Cup.
The only communication from LVMH as a group is done around the special days when the group opens the doors of the workshops of its “houses”, according to Julie El Ghouzzi, “it is an association linked to heritage, culture, the historical dimension “.
“If LVMH goes on an association with the values of sport, the message is completely different,” she believes. “The idea would be that luxury is success. It is a form of democratization of luxury. We associate on the values of success, meritocracy of sport. We can say that luxury is something something that we achieve, that we buy when we have succeeded,” she analyzes.
The Olympic Games taking place in France, in Paris from July 26 to August 11, are also a way of becoming a “prophet in one’s own country”, she underlines while the group – which in 2022 carried out nearly 80 billion euros in turnover – makes 90% of its sales abroad.
On the occasion of the 2024 Olympic Games, LVMH is interested in being "one of the ambassador companies of the country and the city,” confirms to AFP Serge Carreira, lecturer at Sciences Po Paris within the Master Fashion and Luxury.
As for the Olympic Games, "it's a global event that mobilises people and conveys positive values. It's the international high mass of sport, in the noble sense of the term," he stresses. Strategically, "you have to be strong in your home country," adds Mr Briones.
The opening ceremony “looks very spectacular”, noted Antoine Arnault in April. “To do an event like this in the open air, not in a stadium, in the heart of a city, it will probably be the most watched spectacle in the history of television, in the history of the Games. It is obviously an element in which we are very interested,” he added.
“There is a philosophy at LVMH to seek visibility. Today’s visibility is tomorrow’s benefits,” recalls Eric Briones. Nearly four billion viewers are expected for the Paris Olympics.
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