Goodby nabs $40 mil luxury Web site account

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LVMH Moet Hennessy Louis Vuitton tapped Goodby, Silverstein & Partners, San Francisco, to handle a $40 million launch campaign for its new luxury-goods Web site.

LVMH -- parent of Louis Vuitton leather goods and Givenchy apparel and cosmetics -- will unveil the site, eLuxury.com, this spring. It plans to sell luxury goods and services from LVMH and other marketers.

The assignment will initially include only U.S. advertising, but may evolve into a global campaign, executives close to the company said.

A spokeswoman for LVMH confirmed the selection of Goodby, but would not discuss billings. She said only that the campaign will be at "suitable spending levels" to support the launch. Goodby executives would not comment on the win.

AGGRESSIVE GROWTH

In the past two years, LVMH has aggressively pushed to grow its business, most notably with a big bet on e-commerce and on its beauty brand Sephora. The makeup retailer has grown to nearly 50 U.S. stores since it opened its first U.S. branch in 1998.

Sephora kicked its U.S. efforts into high gear in October with the launch of Sephora.com and a flagship store in New York's Rockefeller Center, backed by a $20 million campaign from DDB Worldwide. Sephora later moved the account to Lloyd & Co., New York, a boutique agency specializing in fashion and beauty marketing.

The number of luxury e-tailers has multiplied quickly, creating an increasingly competitive market as similar sites vie for the same eyeballs. According to Media Metrix, no luxury site has yet topped 1 million unique visitors a month. In January, Miadora had 868,000 unique visitors and Ashford.com had 709,000; but Indulge.com, Mondera.com and LuxuryFinder.com each had fewer than 250,000 unique visitors, missing Media Metrix's measurement cutoff.

Ashford spent $2.8 million on offline advertising during the first 11 months of 1999, Mondera spent $2.1 million, Indulge and LuxuryFinder each spent $880,000, and Miadora spent $780,000, according to Competitive Media Reporting.

During the past year, LVMH picked up stakes in fashion houses Fendi and Gucci; bought cosmetics marketers Bliss, Hard Candy and BeneFit Cosmetics; and launched two new U.S. retail concepts, a watch store called Synchrony and sunglasses retailer Solstice.

GOODBY'S GAIN

The win is a boon for Goodby, which had billings of $617 million last year. In the past three months, the agency has won nearly $200 million in billings from such marketers as TiVo, Real Networks, NetFlix, Epinions.com, business-to-business site E.piphany and golf site Chipshot.com.

Goodby is also expected to announce another win soon, that of Chicago-based videogame marketer Midway Games, according to two executives familiar with the situation. Midway Games Exec VP Mike Ribero worked with Goodby when he was at Sega of America.

Contributing: Jennifer Gilbert.

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