...characteristics, values and their life styles. We found 6 different groups: Elite: Main characteristics: * Customers who never feel the impact of economic fluctuations * The traditional segment of the luxury travel * Luxury lifestyle * Looking for the best (the best of the best) and the exclusive * The need to meet with people from the same background These "rich Chinese" are regular customers, and most of the time, are exclusively responsible in banks or executives of the party contractors. They are a big part of the 320 000 Chinese millionaires, often as young as rich. They inform themselves about new products by visiting the catwalks. Louis Vuitton has also a specific politic for this kind of customer; they call them VIC (Very Important Customer). Indeed LV sends them personally letters, they invite them to special private sales where they show them all the new and limited collections in advance. When they shop they make special appointments with the store and most of the time and it is the director who receives them and look after them during their shopping session. The new super rich class: Main characteristics: * Young customers smart and educated * Customers with high revenues * Need for recognition * Looking for a social « status » (climb the social ladder) * Proud of their success * Importance of appearance The ’new super rich class’: Coal mine, company, factory owners, and real estate developers...
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...consumers are now looking for vehicles that are not only comfortable, efficient, and reliable, but also vehicles that offer the new technology at a cost-effective price. On the flip side, people interested in luxury vehicles are now looking for cars that are the most comfortable, reliable, and performance. With bigger engines and a larger price tag, people interested in these vehicles are looking for the daily driver that still has that extra edge in comfort and technology. In Lexus’s ad about the new 2013 LS F Sport, Lexus attracts its audience by creating a window, and showing the audience what kind of person drives an LS F sport, while Ford on the other hand, it ins ad for the Ford Fiesta, shows the audience what its cars offers and that it can provide a premium service, at an economical cost. Both ads capture their respective audiences by highlighting details about the car that that their respective audiences look for in a car. However, what makes an ad for a $100,000 car different than an ad for a $20,000 car, and how do they effectively attract their audiences. The Lexus ad uses the window technique to show what kind of person drives a Lexus, while the Ford ad uses a comparison to compare the features of a Ford Fiesta to the features of a luxury vehicle. In the Lexus ad, Lexus has the car faced in the middle, with two attractive people next to it, and a background which seems to be a party or a gathering. The male is next to the driver’s seat, looking out towards the distance...
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...matching luxury rivals in quality and style, but beating them in price by at least 50%. With this price advantage they attract more of a middle-class consumer as well as upper-class consumers. Another key part of their strategy is their multichannel distribution model. This model is made up of indirect wholesales to third-party retailers, but it also focuses on direct-to-consumer sales. This direct-to-consumer sales strategy accounted for 87% of sales and their wholesale segment was in 970 department stores in 20 different countries in 2011. With this success Coach is still looking to expand globally and build a market share through e-commerce sites. The luxury goods market is divided into three categories: haute-couture, traditional luxury, and the growing submarket “accessible luxury”. Haute-couture is at the top of the market offering a high-end custom product that caters the extremely wealthy, while you have traditional luxury such as Prada, Burberry, Gucci, Polo and many others. This industry is an industry that relies on creative design, high quality, reputation, and attracts consumers through brand loyalty. This brand loyalty comes from an emotional sense of wanting status and feeling value in their purchases. In 2010 consumers spent more than $224 billion on luxury goods and with the emerging markets in China and India this number is expected to rapidly increase because of the increase in the standard of living in these countries. Competition in the luxury goods industry...
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...brands on the search for information and decision making by consumers. 4. How do youthful consumers differ from older adults in terms of information search, personal influence, and auto product preferences? Role plays makes a huge statement in the formation of attitudes. Customers of who have been loyal buyers of Mercedes Benz expect to see consistency. When drastic changes are made it somehow puts Mercedes Benz in the light of luxury in the eyes of the consumer. With something as simple as wood paneling being removed from the normalcy the consumer starts to view differently. Luxury and quality are high standards of Mercedes Benz and these are the expectations of the consumer. Once again listening to your customer will always provide a better return in the long-term. Mercedes can avoid satisfaction with its consumers by including them in what they may want to see in there luxury cars or just state consistent to what customers are familiar with. Change can be a shock to many because it’s an unfamiliar place that many chose to stay away from. Luxury cannot be taken down to average or else it loses its taste. Lexus just as Mercedes Benz all represent high quality and there target areas are to those who seek after this representation. Any form of competition can a healthy way for the automobile industry to stay above the rest while bridging the gap between what the consumers wants and what’s going to benefit them both. Making information available that’s easiest for the consumer...
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...Louis Vuitton in India Executive Summary Louis Vuitton Moët Hennessy, the world’s leading luxury brand, made the decision to formally enter India in 1999. India was a familiar market for Louis Vuitton as the company had filled custom orders from maharajahs since the late 19th century. However, the Indian market was unlike any in which the company was currently operating. The changing socio-economic conditions of the developing nation opened up opportunities for the brand but also posed unique challenges such as changing customer profiles and concepts of luxury. In the West, luxury goods are often sold through company-owned stores in a luxury retail cluster spread over several blocks, usually in a city’s downtown core. In cities that did not have luxury retail clusters, Louis Vuitton operated in luxury malls. Previous attempts to develop premium retail space in India had not been successful. Nevertheless, several real-estate entrepreneurs had plans to open an estimated 300 luxury malls in India by 2010. In India, Louis Vuitton’s first two stores were introduced in luxury malls in New Delhi and Mumbai targeting customers who had shopped abroad and were familiar with the brand. The company was now looking to increase its reach and teamed up with other global brands to develop luxury malls in five Indian metros. Does a high-end brand have a market in a low income country? According to the National Council of Applied Economic Research, in 2001-02 there were 20,000 families...
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...currently compete in the luxury market segment. One of the hotel’s Y1 performance resulted in a drop in market capitalization despite all hotels starting on an even playing field. One other hotel in the economy market segment also experienced a drop in market capitalization. Competitors may be experiencing challenges in executing on their strategies. two other competitor in luxury, one performed poorly (elaborate) ADDED. SEE ABOVE Env. Constraints Income tax- as net profits (profits after tax) increase above $500,000 the tax rate doubles to 44% which is substantial – how this affect on us? (how earning more money has diminished results and if it’s possible for competitor to catch up). HAS NOTHING TO DO WITH US. BASED ON THE ENVIRONMENT. TA’S INSTRUCTIONS INDICATED SUCH. NO CHANGE. ADDED: Market limitations – the price of rooms in both the luxury and economy segments are capped based on the level of stars; furthermore, the actions taken by hotels in the economy segment impacts the luxury segment’s market size while a hotel in the luxury segment cannot capture the economy market’s market share the opposite is not true i.e. a hotel in the economy market may capture a luxury hotel’s market share. Price of hotel (luxury segment) limits the size of the segment, (everyone is aiming at high price, which will make segment even smaller) Economy segment also limit luxury segment size, their advertising etc will affect your luxury segment size. Luxury cannot attract economy segment...
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...Luxury Brand Strategy of Louis Vuitton Shin'ya NAGASAWA* * Graduate School of Commerce, Waseda University Tokyo, Japan, nagasawa@waseda.jp Abstract: By systematically breaking down th e strategy of the single Louis Vuitton luxury brand into the four Ps (Product, Price, Place, and Promotion), our aim in this paper is to extract the rules or principles of its brand marketing that differ from that of general consumer goods. In other words, the object is to distill the rules and principles of success strategies for luxury brands as well as to derive a busi ness m odel for success. Showing that the current rise of Louis V uitton is not a coincidence but rath er so mething ach ieved th rough strat egy will su rely b e of in terest to firm s struggling with lack of brand power or those looking to boost brand power. Key words: luxury brand, brand management, Louis Vuitton. 1. Introduction Consumers like brand items, while researchers like brand theory. Although scholars also use the word “brand” to refer to the likes of Coca-Cola and McDonald’s, there is a vast gulf between these brands and the luxury brands we e xplored i n t he p revious b ook. I n researchers’ brand m anagement theories, one r arely fi nds m ention o f representative luxury brands like Louis Vuitton or Dior, or of LVMH. Based on this awareness, we carefully scrutinized the ecology of the unique LVMH firm, considering the nature of the brand as distinct from commodity markets, although small in scale...
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...Louis Vuitton in India Executive Summary Louis Vuitton Moët Hennessy, the world’s leading luxury brand, made the decision to formally enter India in 1999. India was a familiar market for Louis Vuitton as the company had filled custom orders from maharajahs since the late 19th century. However, the Indian market was unlike any in which the company was currently operating. The changing socio-economic conditions of the developing nation opened up opportunities for the brand but also posed unique challenges such as changing customer profiles and concepts of luxury. In the West, luxury goods are often sold through company-owned stores in a luxury retail cluster spread over several blocks, usually in a city’s downtown core. In cities that did not have luxury retail clusters, Louis Vuitton operated in luxury malls. Previous attempts to develop premium retail space in India had not been successful. Nevertheless, several real-estate entrepreneurs had plans to open an estimated 300 luxury malls in India by 2010. In India, Louis Vuitton’s first two stores were introduced in luxury malls in New Delhi and Mumbai targeting customers who had shopped abroad and were familiar with the brand. The company was now looking to increase its reach and teamed up with other global brands to develop luxury malls in five Indian metros. Does a high-end brand have a market in a low income country? According to the National Council of Applied Economic Research, in 2001-02 there were 20,000 families...
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...Luxury stores audit Gucci and Celine stores, Russian experience Monaco 2012 INTRODUCTION Monaco is a small country, but well known all over the world. All over the world it is known as a place of luxury. Every year a lot of tourists visit Monaco to have a good vacation visiting casinos, luxury restaurants and off course to do a shopping in a most known, luxury brands. In Monaco you can find a lot of different luxury boutiques for every taste; you can find everything from luxury cars to a luxury clothes and accessories. During the course of Luxury audit services we study a lot about the services in luxury stores. So our goal was to divide into groups and to do an audit of few stores. Our group was a big enough for such a mission, so we were thinking how to do it in a better way. And once we got a good idea. According to the information we received during the seminar with Guillaume Rose, in Monaco there are a lot of Russian millionaires, and they are always “invited guests” in different places. So we decided to split our group on two smaller groups and to compare the experience received in Gucci store and in Celine which are situated in the heart of Monaco, near the Casino and Hotel de Paris. I will share with you the Russian experience. I asked my friend, she is from Russia, for some help in this mission. Our story was that we family couple came from Russia for my friend’s wedding and as we already bought a new skirt for my wife we need to buy a new bag, which must be...
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...flat-topped trunk. This new trunk was different from its predecessors, the dome-shaped trunk, in that it was easier to stack and transport. For seven decades Louis Vuitton solely produced leather handmade bags. In 1987, the company merged with Moet Hennessy and diversified into leather accessories. In the mid/late 90’s the company received increasing pressure from Wall Street to sustain a double digit growth rate. In response Louis Vuitton began to look for opportunities to expand globally. Its focus quickly turned to infiltrating the Indian market. By 2008 Louis Vuitton had opened two other stores located in luxury hotels in India. These hotels provided easy access to LV’s targeted market, which was the “super rich”. Now the company was faced with another decision, to continue operation in luxury hotels or to expand into luxury malls. Up to this point, luxury malls were new to Indian consumers, creating a level of uncertainty for Louis Vuitton. In this case evaluation, we will discuss the impact of a high-end company entering a low income country. HIGH-END BRANDS IN LOW INCOME COUNTRIES A high-end brand, such as Louis Vuitton, can often find a market in a low income country. Sometimes the market is too small or too fragmented to pursue, but this is not always the case. Many low income countries have a very unbalanced social structure consisting of a large proportion of the population in or near poverty, a small middle class, and the remainder of the population...
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...Nathan Kim October 19, 2013 Sustainability Roundtable: Sustainability and Luxury Facilitator: Natalie Chan, The Peninsula Hotels In this session of the Sustainability Roundtable, the participants discussed how the luxury segment could adopt sustainable practices in a way that enhanced environmental awareness. The challenge here is in implementing sustainable practices while simultaneously minimizing costs and maintaining if not improving guest satisfaction. Facilitator Natalie Chan of The Peninsula Hotels posed the question, “can luxury be sustainable, or are we deluding ourselves?” Kirby Brendsel, Associate Director of Starwood Global Citizenship, took Natalie’s question a step further. He felt that asking if luxury can be sustainable is premature and we must first define what sustainability in luxury looks like. This was a rhetorical question since Kirby believes if he asked twelve people to describe luxury in sustainability he would receive twelve different responses. Paul Snyder, VP of Corporate Responsibility in InterContinental Hotels Group, had an answer to Kirby’s paradox. Paul suggested that luxury has both a generational and a cultural component, which is why the definition of luxury and sustainability are both moving targets. Natalie acknowledged this point by saying that we are looking at the next generation of luxury customers, those of us who will be guests ten years from today. When it comes to sustainability, we must consider our future guests’ perspectives...
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...Abercrombie and Fitch Abercrombie &Fitch is an American fashion retailer, that sells what they call « casual luxury » apparel for men, women and children under five concepts Abercrombie & Fitch, abercrombie, Hollister, Gilly Hocks and Ruehl No.925, with the main target group being teenagers. From being just one store, the brand prospered to be one of the strongest in the speciality retail market, and now consists of over 1100 stores mainly in the US and Canada, but also in the UK, Italy, Japan, Germany and Spain. They will now expand to even more countries with plans to open up in France, Sweden, Croatia, Denmark, Ireland and China. Abercrombie & Fitch was founded in 1892 in New York by David T. Abercrombie. In the beginning, outdoor and sporting equipment was sold in the one and only store located in lower Manhattan. Ezra Fitch was a lawyer that was dedicated to trekking, who convinced David Abercrombie to let him become a partner in 1900, and the name was then changed to Abercrombie & Fitch. The relationship between Abercrombie and Fitch was not very good, and in 1907, Abercrombie left the company. In the 1960s A&F went bankrupt, and was purchased in 1988 by the Limited Inc, that developed the company to be the lifestyle brand it is today. The image of this brand is being an internationally known near-luxury lifestyle concept. Abercrombie & Fitch is a fashion company, and its success lies on its ability to anticipate new fashion trends and adapt...
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...Recreational Vehicle Magazine Ad The RV model I want to advertise is the most expensive, highline. Most people would think that expensive vehicles are not exactly what people need in the economy we’re having at the moment. However, I want to make a point that recreational vehicle is not a necessity, it is a luxury. Since it is a personal luxury, so why not make it luxurious. When I say luxurious, the vehicle has to represent the glamour of every little detail. We have to exceed the consumer’s expectations and bring it to the next level. Most consumers want something they can make it unique and design it if they’re given the opportunity. Plus, anything luxurious is more attractive than average. My Highline will have customized interior and/or exterior, spacious living space, reliable performance, and of course, its unlimited warranty. The suitable target audience for my project will be the middle age people. As the baby boomers generation ages, retirement is something they are looking forward to. Traveling has been always on top of their lists as soon as they’re finished with their careers. At that point in their lives, they deserve a branded, one of a kind vehicle that they can have as their travel companion. Also, retired people do not really have children at home to think of and to spend money onto. They are at the age where they only spend on themselves trying to live their lives to the fullest. When advertising to the middle age group, the magazine that will be read...
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... Internet is currently the symbol of a digital revolution and most companies are aware that this is a precious tool. Indeed, local and global competition is becoming tougher and companies need to increase continuously their brand awareness to subsist. For this reason, numerous companies are modifying their communication strategy by investing massively in the worldwide network. The creation of an online presence through their website allows them to complement their media channel and to reach more and more potential customers. However, Internet hasn’t been received in the same way by all industries. For example, the luxury industry was afraid to use this new media for many years. Indeed, the luxury world is characterised by idea of high-price products and exclusivity whereas Internet is associated with discount prices and mass communication. Nowanays, luxury brands have...
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...people within the luxury class car market. Since the cheapest model of the five investigated starts at $33,000, buyers need to have a decent amount of money to spend in order to purchase a car of this quality. The ATS is a relatively inexpensive sporty model. It seems to target a certain demographic. It is not really a family oriented car so it appears to be targeted towards mid-income younger individuals or couples needing a car. The ATS appeals to a survivor/experiencers psychographic profile, since it’s an American made, fast, sleek car. ATS purchasers want to fly down back roads and really feel the car perform. Its behavior segmentation targets those who want a real experience while driving; they want to take chances and carve a path while driving. For this reason, the qualities of the ATS outlined on the website target this segment. The ATS is “built to take on the world,” with a lighter chassis, better acceleration and handling, with a great BOSE sound system as well. Cadillac ATS commercials feature young individuals tearing through rough environments, which really help display its target market. The XTS is the all-around car. It has a fantastic sound system, great braking system, and ultimate performance with comfort. I believe this car is aimed towards older (early 30s-early 40s), wealthy yet still single/just married demographic as it seems to be more of a personal than family oriented car. I believe a businessman/woman who is looking to further their...
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