Driven by a dynamic retail strategy, luxury house Hermès has managed to achieve positive figures for the period from July to September. Despite the weakened economic and social context caused by the Covid-19 epidemic, Hermès has remained confident in the future. The brand has actively expanded its presence by opening and renovating several physical stores since the beginning of the year, entering new markets through e-commerce, and enhancing its production capabilities. As a result, Hermès has emerged victorious in the third quarter with a growth rate of +7% at constant exchange rates.
Axel Dumas, CEO of Hermès, emphasizes that 2020 has presented significant strategic challenges such as social and environmental responsibility, digitalization, and the dynamism of Asian markets. Taking these changes into account, the brand remains optimistic in the face of an uncertain future. The strong performance of the business enables Hermès to continue making investments and creating jobs.
During the first nine months of the fiscal year 2020, the group’s revenue reached €4.288 billion, representing a decrease of -14%. While the overall luxury sector is expected to experience a decline of -25% to -45% by the end of the year, Hermès has managed to stay afloat. In the third quarter alone, the brand witnessed a +12% increase in activity in its physical stores, supported by the rapid growth of e-commerce due to the increased usage of online platforms during the period of social distancing. Hermès has further expanded its reach by launching virtual flagship stores in Saudi Arabia and the United Arab Emirates, following successful openings in Hong Kong, Macao, and Korea.
In terms of sales, Asia excluding Japan has shown remarkable performance with a growth rate of +29% in the third quarter. Throughout the three quarters, this region achieved a growth rate of +4%, surpassing the Americas (-29%), Europe excluding France (-27%), and France itself (-33%), which have been directly impacted by the decline in international tourism.
Overall, Hermès has demonstrated its resilience and adaptability in the face of challenging circumstances. The brand’s strategic approach and focus on key markets have positioned it well for ongoing success.
Links:
1. Hermès Official Website
2. Reuters Article on Hermès Q3 Sales
