INTRODUCTION

Louis Vuitton (LV) is known for its manufacturing of fashion and leather goods. One of the company’s early successes occurred when a French craftsman invented a 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 made up of very wealthy families. The small number of wealthy families often controls the majority of the nation’s wealth and can be a sizable market for high-end brands. This provided a business opportunity