Louis Vuitton has shrunk its iconic brown trunk down to a jewelry box to hold such things as chokers from its first jewelry collection, which debuts today in its New York flagship. Vuitton is the star brand of the world’s largest luxury goods group, LVMH Moet Hennessy Louis Vuitton SA.

Never mind that Vuitton’s history comprises 150 years in leather goods, not jewelry. The lack of heritage hasn’t deterred Vuitton or other fashion brands such as Italy’s Gucci, owned by French conglomerate Pinault-Printemps-Redoute SA, from launching jewelry lines in a fragmented market. “The powerful arrival of a fashion brand will animate the market,” said Yves Carcelle, chief executive of LVMH’s fashion and leather-goods division.

Just as branded items have taken over fashion in general, the jewelry sector is ripe for branded jewelry, whether from classic names such as tiffany & co jewelry or Cie. Financiere Richemont SA’s Cartier, or from more fashion-forward labels like Gucci.

For luxury fashion houses in particular, the fine jewelry market — whose margins analysts put at more than 20% — seems like a golden opportunity compared with the overcrowded handbags market. Yet their lack of history in a sector boasting time-honored brands like Cartier and Roman jewelry house Bulgari SpA means more pressure to make designs stand out and find the sweet spot in pricing.

While analysts remain wary of extending a brand into far-flung product categories, jewelry is seen as a logical addition. “Many of the core values of the luxury brand in one product area — high quality, exclusivity and superlative design — can translate easily across to a luxury jewelry brand,” said James Lawson, director of luxury consultancy Ledbury Research.

Analysts at Bear Stearns in New York estimate that luxury brands make up only 15% of the market for fine jewelry, with the rest of the $125 billion jewelry and watch market dominated by unbranded jewelry makers and retailers. “As consumers try to find their way around a fragmented industry where guidance and trust are essential, we believe they will increasingly turn to branded product,” the analysts wrote in a September report on the jewelry and watch market. They anticipate growth in the sector to accelerate to 4% to 5% annually over the next few years, from a historical growth rate of 3%.

If it translates well, jewelry can become part of the core business of luxury fashion groups. Gucci jewelry sales came to 105 million euros ($128 million) in 2003, 7% of Gucci’s annual revenue, three years after it put its first designs in stores. According to Bear Stearns research, Gucci is already the seventh best-selling brand in jewelry and watches behind older brands like Cartier, Tiffany and Chopard.

Vuitton’s Mr. Carcelle said he thinks the jewelry line will make up “a few percent of our revenue” in the next few years, “but when the brand revenue is 3 billion euros, a few percent is not negligible.”

As the market for branded jewelry grows, customers are counting carats less. And jewelry is becoming more of an accessory because women are buying it for themselves, analysts say. “Before, jewelry was part of an investment — when you die, it becomes part of your heritage,” Gucci brand Chief Executive Giacomo Santucci said. “Now, jewelry is becoming more of a fashion accessory.”

“We don’t make engagement rings,” said Vuitton’s Mr. Carcelle, meaning that designer Marc Jacobs is focusing on design pieces, not sentimental jewelry.

Design in fashion jewelry is critical to identify the brands, but also to make up for a lack of heritage. “The lesson from watches, where fashion brands didn’t have any credibility in complicated watch movements, is that they should propose more fashionable items, and realize they have no history in the category,” says Claudia D’Arpizio, a partner at Bain & Co.’s Rome office specializing in luxury.

Using the brand’s icons is elementary. For instance, one of the three themes in Vuitton’s line is “clous,” the nails that pierce its trunks and leather goods. Four of the gold studs hold an enormous amethyst in place on a ring. Bear Stearns analysts praised the latest Gucci collection, which used well-known symbols like bamboo and the “GG” logo, for bearing a more obvious brand label than last year’s “elegant, sophisticated” designs.

As with other accessory lines, finding the right price range for fashion jewelry is key. According to Ms. D’Arpizio, the market for fine jewelry is growing most quickly for items priced between 700 euros and 5,000 euros. Anything more costly crosses the line from accessory to investment, while less expensive items aren’t perceived as exclusive enough to be true luxury goods.

Gucci’s Mr. Santucci says their bestseller is a “GG” logo ring for 1,000 euros, though a cheaper version exists in sterling silver for 250 euros. Vuitton, having sworn off anything lesser than gold and precious or semiprecious stones, will start its line at 550 euros for a pair of stud earrings. Goldman Sachs analyst Jacques-Franck Dossin says the entry-level price “bodes very well for potential client base and for margins.”