LV handbags are essentially still a monetization of the classic monogram
According to Fashion Business News, the French luxury brand LV recently announced the upgrade of the classic Neverfull bag, naming it Neverfull Inside Out, which was released on September 20th. This handbag, priced at 14,800 yuan, is relatively lower in price compared to other new handbags launched in recent years.
A clear signal is that although LV has focused on developing its non-monogram high-end handbags such as Twist in recent years, in the current sluggish luxury market, LV is trying to re-attract consumers by launching a new series of entry-level handbags. I have to admit, LV handbags are essentially still a monetization of the monogram.
The Neverfull was launched in 2007 and is one of the most successful handbag products in LV’s history, having been a bestseller for 17 years.
This handbag was also launched during the tenure of LV’s first creative director, Marc Jacobs. In addition to initiating the fashion series for the first time, Marc Jacobs’ contribution to LV handbags was also quite significant. Under his leadership, handbags co-created with artists like Stephen Sprouse and Richard Prince were regarded as exemplary collaborations between luxury brands and artists, making LV handbags from the Marc Jacobs era still highly sought after in the second-hand market to this day.
Hermès handbags have topped the luxury handbag resale value list for the fourth consecutive year, followed closely by Goyard
The report also noted that handbag brands with an average retention rate in the conservative range of 55% to 85% include Saint Laurent, Gucci, Dior, Loewe, Balenciaga, Fendi, and Prada. Meanwhile, Bottega Veneta, Celine, and Valentino handbags fetch only about 40% to 50% of the retail price in the second-hand market.
Due to Goyard’s long-standing low-key marketing and not being publicly listed, it never shares its financial status, and the industry often excludes Goyard from market landscape discussions. However, as the luxury market’s growth has slowed in the past two years, entering a stock competition for market share, the threat posed by Goyard can no longer be ignored. According to market sources, Goyard’s single-store revenue in major domestic luxury malls can reach several times that of some brands, reaching the level of top luxury brands. Although it entered the Chinese market as early as 2008, Goyard currently has only opened six stores in five cities: Beijing, Shanghai, Shenzhen, Chengdu, and Nanjing. Almost every store is relatively small in size, and the store opened in Chengdu in July this year is Asia’s first two-story store.
According to a document from the Paris Commercial Court disclosed by Bloomberg, Goyard’s sales for the 2013 fiscal year soared to 41.1 million euros, up from just 1.14 million euros in 2000, marking a 35-fold increase over 13 years. Net profit rose from 18,000 euros to 12.8 million euros. Although there have been no market forecasts for the company’s sales scale in the past decade, the market roughly estimates that the company’s annual revenue has reached at least several hundred million euros.
LV new Neverfull Inside Out handbag
Moynat’s iconic Réjane handbag has a history of 118 years
The Moynat iconic handbag Réjane, with a history of 118 years, was originally supposed to become a competitor in the high-end handbag market. However, like Delvaux, Valextra, and others, these niche luxury brands are at a disadvantage in the increasingly fierce competition for high-end handbags against brands like Hermès, Chanel, and LV.
At the same time, Goyard achieved great success with its Y-pattern print, in stark contrast to the deserted state of Moynat. Compared to Moynat’s Toile 1920 Monogram print, today’s consumers are undoubtedly more familiar with Goyard’s Y-pattern print.
In terms of brand awareness, Moynat, which lacks highly recognizable symbols, lags behind Goyard by a margin.
The Moynat personally owned by LVMH’s chairman also failed to successfully block the popularity of Goyard
What is intriguing is that while consumers find Moynat too niche and crave the recognizable Goyard, they also feel aesthetically fatigued by the ubiquitous LV monogram bags, especially the Neverfull.
In fact, when choosing luxury goods, especially entry-level items, consumers always pursue the two purposes of status symbols and functionality, which have never changed.
Entry-level luxury goods need to have a certain level of brand recognition to distinguish them from ordinary mass-market products, allowing the premium paid by buyers to achieve a sense of identity differentiation. Entry-level luxury goods also need to be functional, as entry-level consumers are often more cautious with their spending, seeking higher value for money, considering usage frequency and practicality.
When the LV Neverfull reached the point where most people already owned it, it gradually lost its purpose of distinguishing identity. In terms of performance, if the tote bag style of the LV Neverfull had fewer options in the market 17 years ago, tote bags have now become a common classic style in the current market.
Especially during the decade of rapid technological advancement, when laptops became an essential tool for work, the demand for a handbag that can fit a computer has become completely mainstream, prompting more brands to produce corresponding products.
Therefore, although Goyard’s sudden rise is surprising, the brand’s operational logic still follows the traditions of the luxury industry. At a time when leading luxury brands are overexposed, it has adopted slightly higher pricing to meet the market’s demand for niche luxury identity and functionality, while avoiding the niche brand’s obscurity trap.
First, the Y-pattern print has been overexposed to the point of market aesthetic fatigue and no longer represents niche good taste, which is almost a predictable life cycle. Whether Goyard’s current strategy of fully relying on classic prints is feasible carries significant long-term risks. The brand’s strict control over channels and marketing currently delays this process but does not prevent it.
Moreover, the floral pattern, as a collective product of a specific era, is actually owned by many brands. The distinction between Goyard’s pattern and those of other brands is not very clear. Over the past decade, Goyard has tried to defend its unique status, constantly engaging in lawsuits with another French leather goods manufacturer, Fauré Le Page.
Goyard is quite concerned about another French leather goods manufacturer, Fauré Le Page
In 2012, Goyard sued Fauré Le Page for unfair competition and trademark infringement due to Fauré Le Page’s use of a pattern similar to Goyard’s. In 2015, the Paris High Commercial Court ruled that Goyard must pay Fauré Le Page 100,000 euros in compensation for anti-competitive behavior. The dispute arose because Goyard used tactics in the Hanshin Department Store in Osaka, Japan, to prevent Fauré Le Page’s store from being located near Goyard’s store, forcing it to a relatively quiet area.
Goyard was dissatisfied with the verdict and continued to appeal, but the case sparked controversy in the market over Goyard’s overly aggressive attitude.
Notably, Fauré Le Page, which only established its fashion brand in 2009, was actually renowned worldwide as early as 1717 for manufacturing weapons for the royal family. In terms of brand history, the over three-hundred-year-old Fauré Le Page surpasses Goyard.
From this, it can be seen that Goyard has staked the brand’s fate on the strategy of prints, accompanied by significant investment in trademark protection, much like the efforts made by LV over the past two decades. Currently, the market has seen a large number of Goyard counterfeits. Although counterfeits are a side reflection of the brand’s popularity, they are extremely damaging to the brand’s sales and value.
Secondly, regarding brand positioning, Goyard’s low-key and luxurious mysterious image targets top brands like Hermès, which contradicts the current reality of the brand relying on entry-level basic models. To protect its high-end positioning and address the rapid expansion of the brand’s scale, Goyard will inevitably need to further expand its product matrix and strengthen its focus on high-end products. How to tell a more high-end story with canvas and differentiate it from entry-level models is a challenge that Goyard cannot avoid.
Rather than saying that consumers in the current market are moving from high-profile logos to low-key quiet luxury, it is better to say that consumers are living in an increasingly unstable world, switching mindsets in different states. The luxury market no longer has a single overarching trend, especially in the entry-level market.
As with LV’s design on the Neverfull Inside Out this time, sometimes consumers wish to present themselves with solid-colored, logo-free luxury goods, while at other times they yearn for bold and vibrant prints.
When Chanel and Hermès reduce their reliance on entry-level and middle-class consumers, opting for the higher certainty and more predictable aesthetic preferences of high-net-worth individuals, LV does not intend to give up its role as the benchmark for every consumer’s first luxury handbag and is determined to defend the dominant position of the LV Monogram print.
This also means that LV will continue the psychological game with fickle consumers.
