Luxury brands such as Louis Vuitton and Marc Jacobs are allocating significantly more budget to advertising this year as the ad market rebounds from a disastrous 2009, according to Kantar Media.
Total advertising expenditures through the first half of 2010 are up 5.7 percent year-over-year and many luxury brands are actually outperforming that trend. In particular, Marc Jacobs and Louis Vuitton have increased their ad spend by 280 and 57 percent respectively.
“U.S. advertising expenditures increased 5.7 percent in the first half of 2010, a sign that the advertising market in general is improving,” said Kyle Wall, spokesman for Kantar, Fairfield, CT.
The results come from Kantar’s multimedia ad expenditure database across all measured media, including television, print, online and radio channels.
Ad spend rising
The march upwards in advertising comes in spite of lukewarm economic progress in areas such as retail sales, spending and employment, according to Kantar.
Louis Vuitton spent more than $22 million on advertising across all channels between January and June, compared to slightly more than $14 million during the same period last year, a 57 percent increase.
Meanwhile, Marc Jacobs’ ad budget exploded, as the designer brand increased its spending from less than $5 million to about $14 million, a 280-percent jump.
French fashion house Hermes also increased its advertising budget through the first half of the year.
The $3.6 million it spent from January to June marks a 30-percent increase from its $2.8 million in ad spend during the same time last year.
However, not all prestige brands were so enthusiastic to put their hard-earned capital towards advertising.
English fashion brand Burberry spent $13 million, a meager 2 percent higher than the $12.7 million it put into the ad market last year.
And, Gucci actually slashed its ad buy 66 percent.
The brand spent slightly less than $16 million on ads through the first half of the year, compared to $24 million last year.
However, those figures might change in the second half of the year, as Gucci has made several high-profile purchases in promotion of its new digital flagship (see story) and Guilty fragrance (see story).
Second-half surge
Kantar would not make projections about the future, but data indicates that ad spend for these brands could be as much as two or three times as high through the second half of the year.
For example, Louis Vuitton spent $14 million through the first half of 2009, but finished the year with nearly $40 million in ad bills.
Likewise, Marc Jacobs spent $5 million between January and June 2009, but ended up pushing over $15 million in ads.
The holidays create significant incentive to expend more capital on marketing efforts in the latter half of the calendar year, since the majority of business occurs in during the Christmas push.
Final Take
Peter Finocchiaro, editorial assistant at Luxury Daily, New York