Louis Vuitton has become one of the first luxury brands to respond to the impact of the ongoing anti-government protests in Hong Kong. The luxury brand will be closing one of its Hong Kong stores that was impacted by the protests. South China Morning Post reported that the brand will be closing its stores in Times Square Mall in the Causeway Bay shopping district, however this due to factors outside of the protests as well, specifically the landlord's refusal to lower Louis Vuitton's rent.
Hong Kong as once a very important market for Louis Vuitton, especially with so many tourists from mainland China coming there to buy luxury goods, as they are more affordable in Hong Kong due to the region being free port and not imposing tariffs on imported goods. Unfortunately for Louis Vuitton, the increasingly violent anti-government protests in the region have caused tourism to decline, with the number of tourists dipping 56 percent from last year.
Fellow luxury brands, including Gucci and Salvatore Ferragamo, have reported sales declines of 45 percent. Louis Vuitton parent company LVMH has reported an overall sales decline of 25 percent for the region.
A top luxury brand like Louis Vuitton, which counts billions of dollars in sales per year, could cause a domino affect among other luxury brands who are looking out for their bottom line. It's unclear as to how much longer these protests could go on, but the Chinese government has vowed to nip them in the bud. Luxury retail in Hong Kong isn't looking too promising.
photo: via louisvuitton.com