After Hours Summary: U -26.6%, COIN -16.4%, ICHR -10.5%, TTD -6.6%, RBLX -3.8% lower on earnings; PLBY +10.7%, REAL +10%, HRB +4.5%, EA +2.3% higher on earningsAfter Hours Gainers:
Companies trading higher in after hours in reaction to earnings/guidance: GSM +11.3%, PLBY +10.7%, REAL +10%, CELH +8.4%, ELY +7.9%, HCAT +7.7%, ABCL +7.1%, PRPL +7.1%, ZETA +6.4%, PAYA +5.5%, ORGO +4.9%, ARLO +4.7%, MTTR +4.5%, HRB +4.5%, BOOT +4.3%, AXON +3.7%, FNF +3.5%, GFS +3.5%, SOFI +3.2%, GO +3%, EA +2.3% (also increases dividend), OSUR +2.3%, MSP +2.2%, ALC +2.1%, SKIN +1.5%, KGC +1.3%, DAR +1.2%, EXEL +1.2%, HALO +0.8%, EGHT +0.4%, MODN +0.4%, WES +0.3%, ARWR +0.3%, DV +0.1%, GMED +0.1%
Companies trading higher in after hours in reaction to news: FMC +4.7% (receives pre-suit injunction in China for patent infringement), RAIL +4.7% (CEO to retire in 2023), NVVE +4.5% (to integrate its vehicle-to-grid GIVe platform with Power Electronics charging station tech), HOLX +1.7% (FDA approves Aptima CMV Quant assay for human cytomegalovirus), RTX +1.6% (awarded $270 mln Navy contract), CDLX +1.2% (authorizes new $40 mln share repurchase program), IVZ +0.1% (reports April AUM), AMK +0.1% (reports performance highlights for April), DAN +0.1% (DAN announces long-term supply agreement with LEV)
After Hours Losers:
Companies trading lower in after hours in reaction to earnings/guidance: U -26.6%, INO -19.3% (also names new CEO), COIN -16.4% (also files mixed securities shelf offering), BIRD -15.7%, GRWG -15.7% (also to delay its 10-Q), VUZI -15.1%, GOEV -11.9% (also notes a going concern issue; also files mixed securities shelf offering), ICHR -10.5%, OLO -9.8%, YELL -8.4%, CRCT -7.7%, TTD -6.6%, FLYW -5.4%, ARRY -5.3%, RBLX -3.8%, RKT -3.8%, WBT -2.3%, DOMA -1.4%, KIND -1.3%, OXY -1.2%, GBDC -1.2%, AKA -1.1%, DOUG -0.4%, NSTG -0.4%, RXT -0.3% (also evaluating strategic alternatives and options), SWCH -0.3%, WYNN -0.2%, JXN -0.1%, PAR -0.1%
Companies trading lower in after hours in reaction to news: APP -8.5% (in sympathy with weak earnings from peer U), FOLD -6.4% (FDA extends review period by 90 days for the BLA for cipaglucosidase alfa and the NDA for miglustat), RYI -6.2% (stock offering), CO -5.4% (announces receipt of petition from Blue Ocean Structure Investment), MRCY -3.6% (signs collaboration agreement with LMT to develop new sensor processing technologies), WKHS -3% (finalizes purchase order for 10 battery EVs to add to Amerit's fleet), ARKK -2.9% (U and COIN are both top 10 holdings), TCDA -1.8% (files for $350 mln mixed securities shelf offering), AQN -1.5% (expands renewables partnership with FB), AB -0.7% (reports April AUM), LEV -0.3% (DAN announces long-term supply agreement with LEV), NOVT -0.2% (files mixed securities shelf offering), RXRX -0.2% (files mixed securities shelf offering), AMRC -0.1% (awarded $7.9 mln Army contract)
Closing Stock Market SummaryThe S&P 500 increased 0.3% on Tuesday in a volatile session in which the large growth stocks did the heavy lifting. The Nasdaq Composite pulled ahead with a 1.0% gain, representing the mega-cap outperformance, while the Dow Jones Industrial Average (-0.3%) and Russell 2000 (-0.02%) closed slightly lower.
The session started on a strong note for the market: the S&P 500 rallied as much as 1.9% amid gains across all 11 sectors, ostensibly because the 10-yr yield dropped below 3.00% (-9 bps to 2.99%). The price action in the 10-yr yield, though, was rooted in underlying growth concerns amid news that Shanghai was again tightening COVID-19 restrictions.
By early afternoon, the S&P 500 was down as much as 0.8% as investors sold into the early strength on no specific news catalyst. Selling was relatively indiscriminate apart from the steady gains in the beaten-down mega-caps, which ended up leading the market off session lows and the S&P 500 back above the 4,000 level by the close.
The Vanguard Mega Cap Growth ETF (MGK 193.89, +1.97) advanced 1.0%, whereas the Invesco S&P 500 Equal Weight ETF (RSP 142.51, -0.37) declined 0.3%.
The mega-caps propped up the S&P 500 information technology (+1.6%) and communication services (+0.8%) sectors to the top of the standings, joined by the energy sector (+0.9%). Conversely, the real estate (-2.3%), utilities (-1.2%), and financials (-0.8%) sectors were the worst performers.
The more speculative growth stocks, meanwhile, continued to disappoint, specifically Peloton (PTON 12.90, -1.23, -8.7%), Upstart (UPST 33.61, -43.52, -56.4%), GoodRx (GDRX 7.97, -2.78, -25.9%), and Sofi Technologies (SOFI 5.25, -0.72, -12.1%) following their earnings and/or guidance. Note, SOFI's earnings were released ahead of schedule prior to the close.
Bank stocks, in particular, were pressured by some flattening action in the Treasury market, where the 2s10s spread narrowed by 11 basis points. The 2-yr yield increased two basis points to 2.63%. The SPDR S&P Bank ETF (KBE 46.34, -0.62) fell 1.3%.
In M&A news, Biohaven Pharma (BHVN 140.00, +56.86, +68.4%) agreed to be acquired by Pfizer (PFE 49.49, +0.85, +1.8%) for $11.6 billion, or $148.50/share, in cash -- a hefty 79% premium over yesterday's closing price. Duke Realty (DRE 49.58, +1.87, +3.9%) received a takeover proposal from Prologis (PLD 125.47, -6.90, -5.2%) for about $24 billion, or $61.68/share, in stock.
WTI crude futures settled just above $100.00 per barrel ($100.02, -3.41, -3.3%). The U.S. Dollar Index increased 0.2% to 103.90.
Tuesday's economic data was limited to NFIB Small Business Optimism, which was unchanged at 93.2 in April. Looking ahead, investors will receive the Consumer Price Index for April, the Treasury Budget for April, and the weekly MBA Mortgage Applications Index on Wednesday.
- Dow Jones Industrial Average -11.5% YTD
- S&P 500 -16.1% YTD
- Russell 2000 -21.5% YTD
- Nasdaq Composite -25.0% YTD
Mortgages drive increase in US household debt to nearly $16tn
Credit card balances stand $71bn higher than a year ago but New York Fed says borrowers are in ‘very good shape’
US households added $266bn to their debt balances in the first quarter, led by mortgage loans, in the largest single-quarter increase since 2006, according to the Federal Reserve Bank of New York.
The borrowing took US household debt to $15.84tn, or $1.7tn above pre-pandemic levels, researchers at the Fed branch said in a report on Tuesday. But consumers’ balance sheets are much stronger than they were before the onset of coronavirus in early 2020.
Household credit card balances declined by $15bn in the quarter as borrowers paid down some of last year’s holiday spending. But the seasonal decline was more modest than normal and credit card balances were still $71bn higher than a year before.
Bank executives touted credit card balance growth during earnings calls last month as a sign that the economy was headed back towards business as usual.
“Households are in very good shape in terms of their net wealth,” New York Fed researchers told reporters on Tuesday. “The outstanding debt is of high quality, meaning most of the debt that was originated went to high credit score borrowers.”
Mortgage balances jumped by $250bn in the first quarter compared with the end of last year, as stronger home sales at higher prices pushed homebuyers to take out larger loans. With US interest rates on the rise, people have been rushing to strike deals to avoid even higher financing costs later.
Inflation has been eating away at Americans’ purchasing power, but consumer expectations for inflation over the next year fell slightly in April to 6.3 per cent. Households expect to increase spending by an all-time high of 8 per cent, according to a monthly New York Fed consumer survey that was released on Monday.
Despite rapidly rising prices, the average US household feels better about their financial situation, the survey found. Low-income households drove a decline in the perceived probability of missing an upcoming debt payment in April. The average household is forecasting a 3.1 per cent increase in income this year.
Consumer confidence had been bolstered by a cushion of pandemic-era savings that allowed households to better absorb higher prices and take on debt. But their resilience was likely a factor spooking investors who have bailed out of stock markets this year, said Diane Swonk, chief economist at Grant Thornton.
“The good news is that consumers had a cushion to tap into. The bad news is that the more cushion they have, the more resilient the economy is and the more inflation is a problem,” she said. “That’s why you see the dissonance between consumers and financial markets.”
Last week, the Fed increased its main interest rate by 0.5 percentage points and signalled that similar increases were imminent as it shifts its focus from propping up markets to reining in inflation.
Luxury’s New WeChat Playbook
WeChat’s role connecting brands with Chinese shoppers is evolving fast as it adds features like e-commerce aggregation and integrated clienteling.
Avid users of Chinese social media apps are familiar with a certain type of content that has become even more prevalent in the wake of the pandemic. Customers boasting about hard-to-find luxury purchases now feel compelled to share their sense of triumph over the shopping experience — almost as if they had a narrow escape.
“Today my sales associate sent me a WeChat message saying there was only one more left in stock so I bit the bullet and grabbed it,” wrote one Xiaohongshu user, under a photo of Louis Vuitton’s petit sac plat bag, during the first year of the pandemic. In the second, another user was more matter of fact when they posted a photo of Chanel’s iconic quilted flap bag, fresh out of its box. “I [only] got the bag [after] I connected with the store sales associate on WeChat,” they wrote.
For many of these clients, the post is about more than just showing off an enviable relationship with a retail gatekeeper. At a time when shopping abroad is impossible for most Chinese and long queues often form outside local boutiques for those fortunate enough to not be in lockdown, luxury goods’ perceived scarcity feels more tangible than ever. Though shoppers’ real intention may be to earn brownie points with their sales associate by stroking their ego in a public forum, they often inadvertently promote something else when recounting their luxury haul online: the growing power of WeChat as it adapts to the customer journey.
It’s no secret that WeChat has fared well in recent years. Even as it plays second fiddle to Alibaba in terms of sales channels, the super-app continues to rise in importance as a marketing channel for fashion and beauty brands. As the digital infrastructure that makes everything from messaging to group-buying groceries possible, the platform has never been more top-of-mind for shoppers and marketers alike. But some of the credit to WeChat’s ongoing success goes to parent company Tencent, which has been busy launching and fine-tuning features throughout the pandemic.
From personalising CRM (customer relationship management) to upping traffic in an open ecosystem, here’s what brands should consider as they update strategies for China’s most popular app as it, in turn, evolves in double time.
Next Level Clienteling
As China’s ‘zero-Covid’ policies continue to disrupt the country’s logistics sector, and companies prioritise getting everyday essentials (rather than luxury goods) to residents of Shanghai and other cities, clienteling remains an essential tool for brands looking to stay top-of-mind with homebound shoppers. It is also increasingly important for those who aren’t living in cities under strict restrictions and can still visit physical stores across the country. One way WeChat has bolstered brands’ ability to do clienteling is through upgrades to its sister service WeCom.
Though WeCom, Tencent’s dedicated business communications platform, was officially launched in 2016, it has seen several rounds of updates and risen in prominence over the last two years to become one of WeChat’s main assets, says Michel Tjoeng, senior vice president of sales and marketing at ChatLabs, a WeChat-focused marketing, e-commerce and data management firm.
Though WeCom is technically separate to WeChat, in practice the two are integrated: A WeCom update in January 2022 upped visibility and access between employee and client channels. Crucially, it centralised communications by allowing sales associates to carry out brand-supported engagement through an official corporate channel, rather than selling via their own private messaging accounts. Until this happened, a sales associate who left their brand for a competitor could easily take their list of VIP clients — the “gold dust,” as Tjoeng calls it — with them.
Now, brands use WeCom to share official marketing material, conduct event management, and set up private sales via mini programmes. When customers book appointments to see items in-store, sales associates can more seamlessly access the pieces they’re eyeing and prepare them in advance. “[WeChat] is really the only platform that can facilitate these online to offline synergies,” says Tjoeng.
While WeCom has until recently been the preserve of bigger brands, Tjoeng says that smaller brands are now coming on board. The platform is extremely malleable, meaning brands can invest in personalising their CRM (customer relationship management) systems. Many beauty players, for example, use chatbots to answer frequently asked questions on their official accounts, but for hard luxury players that benefit less from impulse buys, connecting prospective customers to real salespeople is key.
Tjoeng cites British jeweller Graff, a ChatLabs client that used WeCom to build an auto-response function that, after establishing a customer’s city and preferred store, has them scan a QR code to assign a salesperson to take over the relationship.
The Perks and Downsides of an Open Ecosystem
WeChat has long been a comparatively open ecosystem thanks to its mini-programmes. It is also known for allowing brands wider and more creative control over the user experience as well as greater access to data and analytics than other content-centric channels. Tjoeng raises the example of Burberry’s Chinese New Year campaign, which included giving out points to users after they interacted with the brand’s content, allowing them to buy Burberry outfits for their online avatars.
But in order to take advantage of this malleability, brands need to take matters into their own hands when driving traffic to their e-commerce mini programmes and other WeChat touchpoints. Unlike on Alibaba’s Tmall or JD.com, where users can search for items across the whole platform and discover brands they’ve never heard of through an algorithm, the way WeChat works means brands need to work harder for their traffic.
“Traffic has always been WeChat’s weak spot,” says Tjoeng — the platform last year moved to bolster traffic to luxury brands by way of Huiju, an e-commerce platform that aggregates mini programmes to drive traffic to brands’ WeChat storefronts, but it’s too soon to say whether it is a success.
The breadth and multifaceted nature of WeChat also means that unlike content-focused channels including Douyin, content is much less likely to go viral. This remains the case despite the platform’s efforts, through its 2020 launch of the Channels feature, to challenge the TikTok sister app and other short video players. “Channels still has a long way to go; I still don’t think it’s a competitor to Douyin,” says Rui Ma, host and founder of the Tech Buzz China podcast and partner at Synaptic Ventures. The average time spent daily on Douyin, 107 minutes, dwarfs the 35 minutes users typically spend on WeChat’s Channels.
That said, Tencent isn’t giving up. With Channels pushing branded live entertainment since Q4 2021, with performances by musicians reaching 40 million viewers, it’s only a matter of time before fashion and beauty brands with deep pockets play a bigger role in these celebrity experiences.
Playing the Data Game
The most sustainable way for brands to take an initiative on WeChat is still to focus on data insights. “Not leveraging the full potential of WeChat is where most brands fall short, whether it be through minimal targeting efforts, poorly monitored followings or simply underutilising the app’s features,” says Kim Leitzes, influencer marketing firm Lauchmetrics’ managing director of APAC.
Leitzes urges brands to create clear and tailored plans to leverage data to inform future campaigns. This pertains to both official accounts as shoppers’ first port of call, as well as mini programmes, where greater opportunities for user interaction will result in more accurate insights.
How a brand structures their framework should be tailored to their target audience. According to an October 2021 report released jointly by Tencent Marketing Insights and Boston Consulting Group, brand-run mini programmes are especially popular among post-90s generation shoppers and are expected to see sales grow almost 30 percent in 2022. The report adds that while post-90s users prioritise an innovative shopping experience, older users place more stock on efficient, personalised services.
When it comes to attracting users to the account to begin with (and collecting data as they make their way there), creating small incentives is key. Tjoeng sees the likes of Coach and Calvin Klein tap into what he calls the reverse loyalty approach, where rather than giving out loyalty points post-purchase, customers earn points by scanning QR codes, starting conversations with sales associates and watching videos.
The Regulation Question
Though Tencent doesn’t break down revenue figures, WeChat’s slower pace of growth after exceeding the 1 billion monthly active user (MAU) mark in Q3 of 2019 isn’t undermining its hegemony as China’s communications giant, says Ma. “There’s still no alternative to WeChat,” she offers.
In recent years, officials and government agencies have made clear their intentions to do away with China’s digital “walled gardens” — closed loop ecosystems, like WeChat, intended to restrict user value to single apps and thereby limiting users’ abilities to move between apps as well as brands’ cross-platform insights. While some links are now interoperable, progress has been slow, says Ma. “It hasn’t really happened; I expected a faster push.” Even so, she believes that it’s only a matter of time. “The government is very serious about walking down this path; I don’t think they’re just saying it.”
But stricter regulations won’t necessarily affect the ecosystem’s screen time or standing as a one-stop-shop for China’s personal digital needs. “[WeChat] has a very unique position in peoples’ lives,” says Ma, who reckons the ubiquity of its core communications service will insulate it while platforms with a narrower range of services, such as Alibaba’s luxury behemoth Tmall, face a greater danger of losing their dominance.
A threat to WeChat could come by way of newer, innovative players — but even that seems implausible. “Some things are just sticky because of crazy network effects, and [WeChat] has a strong network effect that will be here for the foreseeable future,” says Ma. Indeed, it wouldn’t hurt brands to experiment with planting their flags in buzzy new platforms like metaverse social media app Zheli, but WeChat is going to remain a high priority for most brands. Those who continue to allocate significant resources for the platform and strategise well for it will likely continue to be rewarded, especially considering its lower acquisition costs.
Of all the major tech players, Ma worries the least about WeChat when it comes to Beijing’s regulatory agenda. “No one, I think, has the capability right now of overturning WeChat’s 1 billion user lead. The more they become an ecosystem, the harder it’ll be for other people to disrupt it.”
Three Threats to Big Luxury
Top-tier luxury brands have come roaring out of the pandemic, but the return of experiences, the rising risk of a global downturn and growing ubiquity of widely distributed labels could spell trouble ahead.
KEY INSIGHTS
- After roaring back from pandemic lockdowns, top luxury brands are facing multiple threats.
- The return of experiences, combined with the rising risk of global recession pose a threat to sales.
- Growing ubiquity could also challenge brands that sell “exclusivity by the millions.”
LOS ANGELES — In a city filled with restaurants designed to bait the wealthy and well-known, Nobu Malibu — warmly lit, wood-paneled and perched on the edge of the Pacific Ocean — is a microcosm of high-end consumer culture as it operates in the US today.
On a recent visit, packs of teenagers in modest floral dresses sat alongside young couples vying for a canceled reservation at the sushi bar, with crews of 30-somethings sipping “market” margaritas. However, what united the notably diverse crowd was not necessarily a love of Nobu Matsuhisa’s miso-marinated black cod, but rather a taste for labels like Louis Vuitton, Fendi, Gucci and Dolce & Gabbana, which they mixed with pricey streetwear lines, such as LA-based Rhude.
The early days of Covid-19 hit the luxury sector hard, forcing thousands of store closures and crashing demand for non-essential fashion goods. Then, in 2021, top-tier labels came roaring out of the chaos, with many reporting sales jumps of 30 to 40 percent from pre-pandemic levels.
However, in an industry that prides itself on taking the long view, some insiders are asking: can this last? After decades of unprecedented success, could some of the big brands be on the precipice of their most challenging decade yet?
The label-hungry Nobu crowd reflects a consumer economy in transition. First off, after two years of lockdowns and restrictions, they’re eager to spend more of their disposable income on experiences, which could pose a threat to luxury brands that have benefited from shoppers being stuck in one place. Air travel in the US is almost back to pre-pandemic levels, according to the Transportation Security Administration. (American Airlines said it set a monthly sales record in March.) Live concert ticket sales are up 45 percent from 2019, according to Ticketmaster-owner Live Nation.
At the same time, macroeconomic headwinds are mounting. The chances of a global recession are rising every day, as key markets contend with record-breaking inflation and the fallout from China’s “zero-Covid” strategy and Russia’s Ukraine invasion.
Hardest hit will be consumers who traded up during the pandemic.
“That’s the group that’s going to have to start making hard choices,” said Milton Pedraza, chief executive officer of the Luxury Institute, a research firm.
While the bottom 80 percent of consumers account for just 30 percent of sales at most large luxury brands, they are important to top-line growth and are “not recession proof,” added Karla Martin, a managing director at Deloitte.
At the moment, American consumers, many of whom benefitted from multiple rounds of direct stimulus checks, are shaking off inflation by dipping into savings amassed during lockdowns. But if rates remain high, those savings will continue to evaporate.
The situation is equally tenuous in China. So far, major labels have dismissed China’s Covid woes as temporary, but the combination of highly contagious variants and the country’s “zero-Covid” policy could spell longer-term trouble, experts say.
“China was an extremely reliable market, particularly for accessories,” said Martin. “That gets trickier with Covid and the political situation.”
More broadly, the way people shop for items from big luxury brands is also changing. Consumers crave newness at a pace never seen before, but the relentless marketing of products has had the side effect of making big labels feel more ubiquitous than ever. For brands that trade on perceived exclusivity, that could create fatigue.
For instance, while the average consumer may not be able to afford a $10,000 Chanel jacket, she can now easily keep an image of that jacket as a screensaver on her phone, potentially making it feel less special. It could even decrease her desire to buy the label’s cheaper products, according to Ana Andjelic, author of “The Business of Aspiration.” This exposure is different than the overexposure brands like these experienced in the late 1970s, when they were licensed into near-oblivion — but it’s extreme exposure nonetheless.
“Luxuries are necessarily status symbols, and status symbols only work if they conjure clear associations to elite groups,” added W. David Marx, author of the forthcoming “Status and Culture: How Our Desire for Social Rank Creates Taste, Identity, Art, Fashion and Constant Change.”
”When brands become too ubiquitous, consumers become suspicious,” he said, “and, then, certain that their ownership will lump them together with people they don’t like.”
Some experts argue that the world is fragmented enough, though, for different consumer segments to buy into the same brand without feeling like it is too accessible. Top labels ensure that their distribution, pricing and exposure is segregated enough to welcome all types of consumers.
“You see that purse everywhere when you’re scrolling through Instagram, but you don’t see it every day when you’re walking down the street,” Martin said.
Will the playbook continue to work indefinitely? As luxury becomes more accessible to even more people, this reliable set of tactics may no longer be as effective as they once were.
LVMH Confirms Stéphane Rinderknech Will Lead Hospitality Division
He was most recently president and CEO of L’Oréal USA.
Signaling its ambitions in luxury experiences, LVMH Moët Hennessy Louis Vuitton has appointed a dynamic, much admired executive to lead its hospitality division.
Stéphane Rinderknech, most recently president and chief executive officer of L’Oréal USA and a 20-year veteran of the French beauty giant, has been named chairman and CEO of LVMH Hospitality Excellence, effective June 6, WWD has learned. Rinderknech also becomes a member of LVMH’s executive committee.
The appointment confirms a WWD report on April 28 flagging Rinderknech as the likely successor to Andrea Guerra, who is exiting the role at the end of May to “pursue other interests.” Guerra will then become a strategic and development senior adviser to the French conglomerate, as reported.
LVMH made a step change in hospitality in 2018 with its surprise $2.6 billion acquisition of Belmond, prized for its fleet of marquee properties in a range of standout destinations.
LVMH Hospitality Excellence now comprises Hôtels Cheval Blanc and Belmond Hotels and Trains, which together count more than 50 luxury hotel, restaurant, train and river cruise properties. Among the marquee properties are the Cipriani in Venice, the Copacabana Palace in Rio de Janeiro, the Mount Nelson in Capetown and the Venice Simplon-Orient-Express Train.
The group’s fashion and leather goods brands have also been stepping further into experiences, with Louis Vuitton adding eateries and a chocolate shop to new flagships in Japan, while Dior’s supercharged Avenue Montaigne boutique now incorporates a restaurant, cafe, museum and hotel suite.
When La Samaritaine reopened last June after a long renovation, the landmark department store debuted a clutch of new restaurants and a Hôtel Cheval Blanc that is said to be enjoying occupancy rates in excess of 90 percent, despite the lack of Chinese tourists in the French capital. Reservations at its restaurants Le Tout-Paris and Langosteria are difficult to come by.
“High-end hospitality represents a great opportunity for our group,” Bernard Arnault, chairman and CEO of LVMH Group, said in an internal announcement seen by WWD.
The luxury titan trumpeted that Rinderknech “has demonstrated a remarkable ability to deliver impressive performances, to develop organizations and to bring out the best in talented people” throughout his career.
“His appetite to learn and constantly evolve, coupled with his agility and passion for new challenges, constitute compelling assets to lead our exceptional properties and destinations to a next level of development,” Arnault added.
In the wake of the appointment, Olivier Lefebvre, CEO of Hôtels Cheval Blanc, and Roeland Vos, chairman and CEO of Belmond Hotels & Trains, will report to Rinderknech.
“I am thrilled to join the LVMH Group and to take the lead of its Hospitality Excellence division,” Rinderknech commented in the announcement. “During my many years living abroad, I have developed a deep passion for the art of hospitality and its variations around the world.
“With their unique properties and heritages, Cheval Blanc and Belmond are ideally positioned to meet customers’ expectations for authentic luxury experiences,” he added.
A graduate of ISG Business School in Paris, Rinderknech began his career in 2002 with the American travel retail division of L’Oréal, accruing additional responsibilities when he took on positions in Japan and South Korea.
He moved to China in 2011, first as general manager of L’Oréal’s Luxe Division, then as head of the Consumer Products Division before being promoted to president and CEO of L’Oréal China for all divisions and corporate operations.
Rinderknech became a member of L’Oréal’s executive committee in 2018 and a year later assumed the management helm of L’Oréal USA.
Hailed as a rising star and viable candidate to be CEO of L’Oréal’s global operations one day, he was responsible for increasing the company’s China business by 30 percent during his time as CEO of that division. His strength in digital marketing — e-commerce accounted for 40 percent of L’Oréal’s sales in the country when he left — was a key driver behind his appointment in the U.S., where he was charged with accelerating L’Oréal’s digital transformation.
While LVMH is known for growing and grooming executive talent from within, it has recruited a number of high-profile L’Oréal executives in recent years, including Damien Bertrand, now CEO of Loro Piana, and Pierre-Emmanuel Angeloglou, strategic missions director for fashion and leather goods at Louis Vuitton.
Fed's Waller (hawk, voter): Fed was not alone in getting inflation call wrong
- Fed raising rates to cool off demand, curb inflation
- Inflation is too high, my hob is to get it down, if we get some help from supply chain resolution, that is fantastic, but won't count on it
- Could pull back demand for labor and that would be a good thing
- We are trying to get job market back to equilibrium, right now it is out of whack
- We think we can raise interest rates and not have a big impact on unemployment
- Don't need to tank economy to bring down inflation
- Do not see a need for a central bank digital currency (CBDC)
- Need to give people notice in advance, not shock them
- Doesn't see anything bad happening to the housing market; Demand for housing is strong and supply is short
- Right now the labor market is so strong, we can pull this off without doing much damage