Inside the $7 billion Dior phenomenon | Download the case study

In 1947, just a few months after its founding, Christian Dior Couture revolutionized women’s clothing with its post-war “New Look”, securing a place at the pinnacle of French fashion. Dior later became the cornerstone of the luxury empire of LVMH chairman Bernard Arnault, who has invested in the house with a “sky’s the limit” approach since the 1980s. But for many years, the Dior brand, one of the most famous and prestigious brands in modern luxury, remained bigger than its business.

In 2017, LVMH took full control of Christian Dior, initiating a series of moves that would radically accelerate the business. Under new CEO Pietro Beccari and designers Maria Grazia Chiuri and Kim Jones, Dior’s business has grown rapidly, with sales nearly tripling since the deal. Its newfound scale has created a virtuous circle, allowing it to invest even more in spectacular shows and expanding boutiques, all while multiplying estimated profits by a factor of seven. As Dior moves closer to overtaking its historical rival, Bernstein analyst Luca Solca called it “a homegrown Chanel within LVMH.”

This case study examines how Dior became one of the fastest growing and most profitable businesses in luxury fashion. The company overhauled its product offerings and communications, extending a couture culture of craftsmanship and innovation that had long animated its theatrical runway collections, and applying them across its business lines to create a diversified menu of products. successful. The company also jumped into e-commerce, rapidly expanding its reach beyond the shopping capitals where it operates stores, launching spectacular and immersive flagships to serve as a destination for a wide range of brand devotees, from aspiring tourists to who spend more VIC”. As the coronavirus hit sales for most fashion companies, Dior capitalized on its momentum by continuing to stage major marketing moments that engaged consumers at home viewing online and fueled post-pandemic growth.

The strategy appears to be paying off: Dior has rapidly gone from around €2.2bn ($2.5bn) in revenue in 2017 to €6.6bn in 2021, according to estimates, and strong growth puts it closer than ever. never to surpass the mega-brand. rivals like Gucci, Hermès or even luxury titan Chanel. With an operating margin of more than 35 per cent of sales, the brand is now likely to be the fourth most profitable listed luxury fashion brand, after LVMH stablemate Louis Vuitton, Kering’s Gucci and Hermès.

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