LVMH Founder Is Richest Man In The World...What Does It Mean?
This morning, Bernard Arnault is the richest man in the world.
If you asked a thousand people they would likely guess, Jeff Bezos, Bill Gates and Elon Musk.
I am not sure how long this lasts, but what does it mean if anything?
LVMH is a $350 billion conglomerate.
Here is a description of the business (from Koyfin):
LVMH Moët Hennessy - Louis Vuitton, Société Européenne operates as a luxury goods company worldwide. The company offers champagnes, wines, and spirits under the Clos des Lambrays, Château d'Yquem, Dom Pérignon, Ruinart, Moët & Chandon, Hennessy, Veuve Clicquot, Ardbeg, Château Cheval Blanc, Glenmorangie, Krug, Mercier, Chandon, Cape Mentelle, Newton Vineyard, Cloudy Bay, Belvedere, Terrazas de los Andes, Bodega Numanthia, Cheval des Andes, Woodinville, Ao Yun, Clos19, and Volcan de mi Tierra brands. It also provides fashion and leather products under the Berluti, Celine, Christian Dior, Emilio Pucci, FENDI, Givenchy, Kenzo, Loewe, Loro Piana, Louis Vuitton, Marc Jacobs, Moynat, Patou, and RIMOWA brands. In addition, the company offers perfumes and cosmetics under the Acqua di Parma, Benefit Cosmetics, Cha Ling, Fenty Beauty by Rihanna, Fresh, Givenchy Parfums, Guerlain, KVD Beauty, Kenzo Parfums, Maison Francis Kurkdjian, Make Up For Ever, Marc Jacobs Beauty, Officine Universelle Buly, Parfums Christian Dior, and Perfumes Loewe brands; watches and jewelry under the Bulgari, Chaumet, Fred, Hublot, Repossi, TAG Heuer, Tiffany & Co., and Zenith brands; and custom-designed yachts under the Feadship brand name, as well as designs and builds luxury yachts under the Royal Van Lent brand. Further, it provides daily newspapers under the Les Échos brand; Belmond, a luxury tourism service; home other activities under the Belmond, Cheval Blanc, Connaissance des Arts, Cova, Investir, Jardin d'Acclimatation, La Samaritaine, Le Parisien, and Radio Classique brands; and selective retailing products under the DFS, La Grande Epicerie de Paris, Le Bon Marché Rive Gauche, Sephora, and Starboard Cruise Services brands, as well as operates Jardin d’Acclimatation, a leisure and amusement park. The company operates 5,556 stores. LVMH Moët Hennessy - Louis Vuitton, Société Européenne was incorporated in 1923 and is headquartered in Paris, France.
Here is a long term stock chart:
Sam Lessin, an entrepreneur and venture capitalist now founder of The Information (I like it and am a subscriber) says that having a 'luxury king' is depressing. You can read his missive here.
Personally, I find it fascinating and exciting that a 'non' tech person in 2022 is the richest person in the world.
In one of my favorite business movies growing up - Night Shift - Michael Keaton says to Henry Winkler - Feed Mayo to the Tuna.
That is what LVMH does so well. Their 'tuna' are wealthy and highly aspirational people. These people have become easier to reach and speak to in a world controlled by our digital overloads who have clamped down on new brands being able to efficiently grow their customer base in this new high CAC world.
I don't think it lasts, but I do think technology first thinking is not everything and maybe even stale. LVMH has more tools than ever in web 2 and web 3 to deploy at scale across the globe to sell product and increase both value and perceived value of products and experiences. Time works in LVMH favor as a producer of luxury goods and does not work in favor of wealthy technologists who are constantly being disrupted.
I have been thinking about this for a decade writing about 'Fashology' on this blog and investing in a few startups that aspire to be LVMH not Google.