Marketing Strategy of Lv

21/12/2011 Marketing Strategy analysis of LVMH with a special focus on LV Industry overview Louis Vuitton Malletier is commonly referred to as Louis Vuitton, any(prenominal)times shortened to LV, is French sumptuosity fashion and whip goods phoner. The company was founded in 1854, and now is the cornerstone of LVMH and its main division gondola carrying almost a quarter of the total group. LVMH is the world leader in the luxury industry. It was established in 1987 done the union of three brands Louis Vuitton, Moet and Henessy.This union gave birth to a global group that, in addition to leather goods and spirits, brings together to the distribution, a liberal variety of brands in all divisions of the luxury perfumes, jewelry, watches and also champagne. Through its policy of brand phylogenesis and expansion of its distribution network abroad (more than 2300 stores worldwide), LVMH has became, since its creation in 1987, a agency of a strong growth it is now the first capital in France and the thirteenth in the world, with 77000 employees of which 74% argon based outside France and that shargon the homogeneous values of the groupe.Corporate strategy A strategic segmentation In the luxury sector, LVMH has invested in six dissimilar strategic business aras wines and spirits, fashion and leather goods, perfumes and cosmetics, watches and jewelry, selective distribution and opposite activities. Louis Vuitton is trying to represent by its point of intersections, the most refined qualities of Western Art de Vivre around the world. The company is also trying to relate to be synonymous with both elegance and creativity in leather products, blending tradition and innovation through their products and kindling dream and fantasy.How Louis Vuitton attracts its costumers LouisVuittonisa luxury brandbelonging toLVMH whichisthe mostvaluedbrandinthe world of luxury. Since 1854thishas been succeeding withitsluxuryluggagefirst andthen withfashion industry(especiall y with collectionsby Marc Jacobs). LouisVuittonhas introducedmany advertising campaigns,but ten years of fashion communion have overshadowed the house. The company realized that customers were less sensitive to the values that were associated with the brand.Therefore the company wanted to put aside while the commercial communication by focusing on a more institutional in order to rise the house and not just the products. LouisVuittonthen chose to move from product communicationtocorporate communications. The goal isto communicatethe values and philosophy ofthe brand and itsleitmotivthe faux pas. To lay downaclose relationship with itscustomers, the Internetappearsto be the best means of communication(interactivity, photos,videos. ) The fundamental valuethat is conveyedis thetrip.Todaythe concepthas evolved intravelhabits(mass tourism, development oflow cost), becoming very usual and then there is nomore magic in thetravel orescape. In this newcommunication campaignLVseeks to use the concept ofjourneyfromideatoidea of physicalpersonal journey (passenger). Two of LV advertisements that are using the trip concept Main objectives of the company Long term objectives The groupaims to ensure thesustainability of the companyby focusingoncore brandslike thecapital(pillars)of the 5areas ofLVMH. In addition,LVMHhasthe opportunity to gainmarket share, eclininghis offerofnew niches(accessories). It must continue to investfor growth. Short term objectives LVMH wants to achieve a rapid egest to the strategic activities such as selling on the Internet like on eLUXURY. com These activities can beretained in theportfolio onesbecause theydo not monopolizeconsiderable energyover the long termandare a source ofdirect profitability(high margin). Analysis of the four Ps strategy harvest-feast Louis Vuittons products are very distinguished by their absolute quality and very high price.The aim of LVMH is also to make populate feel a big difference between any brand and a brand Louis Vuitton. Therefore a strong image is needed to achieve those aims. One of the big issues that touch LV products is counterfeiting which the company is trying hardly to fight against with enlightenment campaigns, distribution of warning notices to companies, registering the trademarks and designs and making some activities with the Union des Fabricants which is a exoteric interest incorporated association that carries out trademark protection activities.The company is also working on prohibiting appraisal of authenticity by officially clear stores that are alone able to verify whether an article is genuine or not, but also using the mass media to tell people about some details to take into account before appraising whether an LV good is genuine or not. By choosing not to make cheap goods at all, LV is also prohibiting second-line operations or what we call lower-cost alternatives. This can be sort of limitation to a greater expansion but a good superior to the company to sta y in the luxury area. Another principle of LV product is that LV is an independent manufacture that is prohibiting outlet product production in order to control the brand value and making a real control on the prices. LV has also a special order serving for customers that would like to buy customized and order-made products. Price LV goods prices are very high, but their value is also of a very high level. The prices are widely evaluate by women.The company is trying then to write the trust the costumers have in its reliable pricing, especially by prohibiting exorbitant pricing, bargain sales, sales in value sets, surprise price changes, pricing in odd prices Place LVMH has no boundary its market is global, taking into account national or regional areas. The company has a geographical strategy that is built on the sentence Think global, act local. The value of having a global market is to castigate the vagaries of economic conditions (fluctuations in exchange rates, etc. .. ), s ocial (war, etc. .. and demographic issues (emerging Asian countries, etc. .. ). This allows them to meet the specific demands of the market better than in other possible way for example, the Italians prefer sweet taste champagne that can be adapted to be the right product for them, with mixtures of wines and grapes varieties that are specific to champagne. On the other hand the internationalization of sales allows the company to respond to many different behavioral changes of consumers. Moreover, LVMH is seeking to supply new markets with very high potential drop such as China and India.LVMH benefits from the liberalization of world trade. Promotion LV in comparison with most companies that use mass advertising, never advertise on television but only on magazines and newspapers with non aggressive sales ads, just images. The brand represents the discovery, travel, sophistication, elegance and creativity. When such words are associated with a company we get word that communicatio n must be really special. Louis Vuitton does not use media such as radio and television media that are surely too popular. Louis Vuitton, because of the demands in womens magazines (Elle, Vogue, Madame Figaro , , advertisements published in its journals always have a particular theme (urban, fables, seven deadly sins , ). To promote its goods, Louis Vuitton prefers to also organize special events such as Concours dElegance car and the Americas Cup (also known as Louis Vuitton Cup). The brand,asfor other firms, isusingthe frontofthe storesbeing built foradvertising. For examplein NewYorkcan be seenat a height ofover 20 metersJenniferLopez,new ambassadorofVuittons flagship productscarrythe brand. Vuittonalsodoes not hesitateto call ongreat personalitiesto representthe company.The paradesarealso a good way tomake them known. The targetis not only thepublic whoattended theparade (a few hundred people), butthe people whohear aboutin the press andother media. LV marketing strategy is al so based on a special process of diversification To stay number one in the luxury sector, LVMH group usually offers a similar product line to the 4 corners of the planet, but in different ways. LVMH is seeking to reach a new clientele that is willing to splurge. They have access to luxury by ancillary products already present in the product range it requires no new skills or additional skills.This diversification marketing involves distinctive innovations both in the cut of clothes (packaging for perfumes) that the composition of handbags (new materials). either this requires a research and development performance, bringing together the best designers to get a head start as soon as possible and maintain the trend. Weaknesses of Louis Vuitton and propositions for better strategy LV products are the most copied in the World, which is not the case of other luxury companies like Hermes for example. Indeed, Counterfeiting is a real problem for the segment of luxury products.The extens ion of the brand could contribute to the loss of image and prestige. To remedy this, Louis Vuitton is strongly committed to the fight against counterfeiting by establishing a specific team to sensibilise the consumer and arrest the counterfeiters around the world and especially in countries where the phenomenon is more present like China. Also, the prices of LV products are not the same around the world they are 50% higher in Asia and 25% higher in the U. S. In addition, foreigners that are residing outside European community can benefit from a taxation refund.It is therefore more interesting for many foreigners to buy Louis Vuitton products in France, thus we have a great development of the traffic around this brand. Indeed, there are many consumers that buy LV products in France and then resale them to foreigners. Others collaborate with foreigners and accept to act as intermediaries for the purchase of these products, with taking a commission for this service. The resale of a pr oduct devalues its image as luxury item the resoled product loses its charm and uniqueness it becomes such a commodity and no longer a luxury product.To clog this, LV has to develop more its computer control of sales. And since the luxury market is an area of a big concurrence, LVMH is always required to be distinguished from the others, to keep innovating its products, marketing, advertisements themes and in the same time defending its values And since it has became a worldwide known brand, may be to make some customization in production, sales and marketing for each culture, I would like to propose to make for come chosen countries special processes of production , sales and advertising that meet but also emerge from their cultureReferences * http//www. iasdr2009. org/ap/Papers/Orally%20Presented%20Papers/Design%20Management/Luxury%20Brand%20Strategy%20of%20Louis%20Vuitton. pdf * http//veronique. estienne. free. fr/doc/SLIDE. htm