Louis Vuitton has been named the world's most valuable luxury brand.

The French fashion house - whose creative director is Marc Jacobs - took the title for a seventh consecutive year after being valued at $25.9 billion following a study based on analysis of company performance and consumer interviews conducted by global research company Millward Brown Optimor.

Louis Vuitton beat off competition from Hermes, which was second with $19.1 billion, and Swiss watchmakers Rolex were third with $7.17 billion.

"Luxury is seen as a good investment with people increasingly buying classic pieces rather than high fashion. Those who can afford it indulge, including young professionals who, increasingly unable to buy houses, are spending their disposable income on mid-tier luxury," Nick Cooper, managing director of Millward Brown Optimor, said in a statement.

Chanel were fourth with $6.68 billion, followed closely behind by Gucci in fifth with $6.42 million, while Prada were sixth on the list with $5.7 billion.

History, heritage and quality craftsmanship were all key components considered in the study, which featured Cartier ($4.8 billion) in seventh place and Burberry ($4.09 billion) at 10th.