Christian Dior, once called one of the "big four" luxury houses alongside "Erusha" (Hermès, Louis Vuitton, Chanel), is showing unusually weak momentum in the Korean market. Over the past two years, Chanel, Louis Vuitton and Hermès each set record results, while Dior saw both revenue and operating profit decline for two straight years, posting negative growth. The industry sees a combination of factors at work, including polarization within the luxury market, demand shifting toward luxury jewelry, and damage to the brand's image.
According to the Financial Supervisory Service's electronic disclosure system on the 16th, Christian Dior Couture Korea posted revenue of 773.9 billion won and operating profit of 129.2 billion won last year. Compared with the previous year, revenue fell 18.1% and operating profit fell 43.0%. Earlier, in 2024, Dior also recorded revenue of 945.3 billion won and operating profit of 226.6 billion won, down 9.6% and 27.4%, respectively, from a year earlier.
The contrast with rival brands is even clearer. Chanel Korea's revenue last year was 2.013 trillion won, up 9.0% from a year earlier, and operating profit was 336.0 billion won, up 25%. Louis Vuitton Korea posted revenue of 1.8543 trillion won and operating profit of 525.6 billion won, increases of 6.1% and 35.1%, respectively. Hermès Korea also saw revenue of 1.1251 trillion won and operating profit of 305.5 billion won, up 16.7% and 14.6% from the previous year.
Polarization within the luxury market is cited first as the backdrop to Dior's slump. While demand remains steady for top high-end brands such as Chanel, Hermès and Louis Vuitton despite repeated price hikes, brands with relatively lower standing are being hit harder by weaker consumption during the economic slowdown.
In fact, Ferragamo Korea's revenue last year was 82.8 billion won, the lowest in 15 years, and Fendi Korea also posted revenue of 87.7 billion won, down 26.2% from a year earlier. A luxury industry official said, "As luxury consumption has become more widespread, consumers with greater purchasing power are concentrating their demand on the top-tier brands with stronger symbolism."
The recent shift in the center of luxury spending toward luxury jewelry and watches is also cited as an unfavorable factor for Dior. Although Dior operates a jewelry line, the brand's core competitiveness is still seen as closer to women's fashion and leather goods.
In the department store sector lately, luxury jewelry and watches are clearly leading the growth in luxury sales. According to Shinsegae Department Store, first-quarter luxury sales at its main store this year rose 29.8% from a year earlier, while luxury jewelry rose 55.6% and luxury watches rose 36.9% over the same period, far outpacing the overall growth rate.
Damage to Dior's brand image is also cited as a factor behind the weak performance. In June 2024, Dior became embroiled in allegations of labor exploitation surrounding its Italian supply chain and controversy over a "80,000-won cost bag." During an investigation by Italian authorities, evidence emerged that Dior's Chinese subcontractor supplied a bag for about 53 euros (then about 80,000 won), and the controversy grew as it became known the product was sold in stores for 2,600 euros.
On top of that, allegations of poor production conditions, including illegal long working hours and removal of safety devices, were raised, shaking trust in the brand. Since luxury consumption is built on trust in scarcity, craftsmanship and brand narrative more than the product itself, analysts say such supply chain controversies weighed on Dior's image and consumer sentiment.
That said, Dior is not simply standing by and watching the slump. It is moving to reorganize to raise its brand presence in the Korean market. Last year, Dior held a large-scale archive exhibition, "Christian Dior: Designer of Dreams," at Dongdaemun Design Plaza (DDP) in Seoul, putting effort into reframing the brand's history and identity. Rather than merely boosting sales, the moves focused on reimprinting the brand's narrative and sensibility, leading to interpretations that Dior, despite weak results, still views the Korean market as an important strategic base.
There is also ongoing movement to reorganize offline channels. Dior is showcasing its latest collections through its concept store in Seongsu-dong, Seoul, maintaining touchpoints with younger customers. At Shinsegae Department Store's main branch, it is pushing a renewal to expand the existing store into a two-level space on the first and second floors and make it a full-line store carrying all of the brand's product categories.
Can Dior regain its presence in the Korean market? For Dior, the task remains to demonstrate clear competitiveness again amid a polarized luxury market and shifting consumer trends. Attention is on whether Dior can create a turning point for a rebound.