...The success of luxury brands in Japan and their uncertain future Ronald Jean Degen International School of Management Paris 2009 Working paper nº 52/2009 2 globADVANTAGE Center of Research in International Business & Strategy INDEA - Campus 5 Rua das Olhalvas Instituto Politécnico de Leiria 2414 - 016 Leiria PORTUGAL Tel. (+351) 244 845 051 Fax. (+351) 244 845 059 E-mail: globadvantage@ipleiria.pt Webpage: www.globadvantage.ipleiria.pt WORKING PAPER Nº 52/2010 Janeiro 2010 Com o apoio da UNISUL Business School 3 The success of luxury brands in Japan and their uncertain future Ronald Jean Degen Ph.D. Candidate at the International School of Management Paris Vice Chairman of Masisa Chile Address: E-mail: degen@lomasnegras.com Phone: +55 41 9918 9000 Cabanha Orgânica Lomas Negras Ltda. Caixa Postal 95 Campo Alegre, SC 89294-000 Brasil Ronald Jean Degen is in the Ph.D. Program of the International School of Management in Paris, and the Vice Chairman of Masisa in Chile. He was a Professor at the Getúlio Vargas Graduate Business School of São Paulo where he pioneered the introduction of teaching entrepreneurship in 1980 and wrote the first textbook in Portuguese on entrepreneurship published in 1989 by McGraw-Hill. He just published a new textbook on entrepreneurship that was published in 2009 by Pearson Education 4 The success of luxury brands in Japan and their uncertain future ABSTRACT The Japanese are the...
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...The Luxury Evolution Every generation redefines its definition of luxury. How they relate to it or reject it. From the “more generation”, to the X, we have seen everything from conspicuous consumption to less is more. Each generation also redefines its relationship to luxury. The evolution of social, political and economic factors is just a few of the major defining elements in any generation’s approach to luxury products. How a particular group defines luxury is often influenced by the preceding generation’s relationship to it. Is it a coincidence that the lean, Generation-X “less is more” philosophy of the 1990’s immediately followed the Baby Boomer’s conspicuous consumption ideals of the 1980’s. No business lives or dies more by the definition of luxury, than the Cosmetics Industry. From mass to class distribution to direct sell, luxury is the name, of the game. Revolution or evolution, defining luxury becomes the bete noir as the baton is handed to each new generation The Cosmetics Industry lives on its ability to provide luxury goods (No matter the definition) more than any other. It is imperative that we not Only understand how varying market segments define luxury and thereby consume it, but equally important that we can predict how fresh and upcoming markets will define their unique relationship to it. As an industry we must ask ourselves, are we open to deconstructing traditional definitions of what constitutes luxury? What new requisites will tomorrow’s...
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...The Swiss Luxury Watchmaking Industry A general overview and a closer look at the celebrity endorsement and sponsorship communication strategy used by the leaders. Karine Gautschi January 2005 HEC Lausanne – Hautes Etudes Commerciales, MIM – Master of International Management Thesis Director, MIM: Professor Stéphane Garelli Expert, Omega: Jean-Pascal Perret Table of Contents 1 2 INTRODUCTION .............................................................................................................. 1 LUXURY WATCH INDUSTRY: A SHORT OVERVIEW .................................................. 3 2.1 2.2 3 DEFINITION AND PRICE SEGMENTATION ........................................................................ 3 LUXURY BRANDS AND THEIR POSITIONING ..................................................................... 5 ANALYSIS OF THE LUXURY WATCH INDUSTRY........................................................ 7 3.1 THREAT OF NEW ENTRANTS .......................................................................................... 9 Capital requirement ............................................................................................ 9 Brand recognition ............................................................................................... 9 Distribution........................................................................................................ 15 3.1.1 3.1.2 3.1.3 3.2 BARGAINING POWER OF BUYERS .........................................
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...Consumer and Shopper Insights August 2011 Korea’s luxury market: Demanding consumers, but room to grow By Aimee Kim and Martine Shin Key themes from the 2011 McKinsey Korea Luxury Consumer Survey Every year since 2006, sales of luxury goods in South Korea have risen at least 12%1, to an estimated $4.5 billion in 2010. In the first four months of 2011, sales at department stores were up more than 30% compared to 2010. 2 This continues an established trend, as last year’s report on the market showed (see report at csi.mckinsey.com: “Living it up in luxury.”) Still, insiders are asking whether it can last. For one thing, according to McKinsey’s survey, the percentage of household income that luxury consumers spend on luxury is already higher in South Korea (5%), than in Japan (4%)3—and the Japanese luxury market has been stagnant in recent years. Moreover, the performances of famous brands in Korea have been mixed. For example, LVMH and Ferragamo continued to do well, but others, like Gucci Group and Dior, saw sales drop in real terms in 2010.4 1 2 3 4 5 6 Thus, while the headline news is that the luxury market is still growing strongly, uncertainty is also mounting. In this year’s report, McKinsey addresses these concerns, which come in the form of three key questions: Can South Korea keep it up? What’s changing? And what do these trends mean for the players in the luxury industry? To answer these questions, for the second year in a row, McKinsey surveyed 1,000 Koreans...
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...Looking at luxury: consuming luxury fashion in global cities Professor Louise Crewe, University of Nottingham, UK Dr. Amber Martin, Queen Mary University of London, UK 1: Introduction This chapter explores the growth and transformation of the global luxury fashion market focusing specifically on the flagship stores of the largest global luxury fashion organisations.[1] The conceptual basis of the chapter lies in recent debates about global economic austerity and the future of consumption under conditions of precarity. The chapter focuses on the remarkable resilience of the luxury market in the face of global recession and the slow-down in consumer spending. Luxury consumption and passionate investment are argued to provide one means through which the more deleterious effects of the over-consumption of cheap, throwaway, fast fashion can be effaced. The arguments made in the chapter are both theoretically and empirically significant. Firstly, luxury fashion is empirically an important but neglected area of scholarship and one with a pronounced Geography that requires scrutiny. The luxury fashion market is significant not only in terms of its value but also in terms of its rate of growth which has significantly outpaced that of other consumer goods categories over recent decades. The rate of growth has been driven by a variety of factors, including growing concerns over the economic, environmental and social impacts of throwaway fashion, a desire for more responsible investment...
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...-luxury stores are becoming hybrid institutions, embodying elements of both art galleries and museums, within a context of exclusivity emblematic of luxury - Participants take note of the company’s sleekly elegant architecture, interior design, and adroit use of lighting that are modelled after those of museums housing world-class exhibits. The store’s merchandize is artisanal, often produced in collaboration with artists. Objects for sale are displayed alongside actual art, rendering both products equivalent. Employees function as curators, offering guidance and knowledge, as well as goods for sale. We analyze how luxury consumers experience and evaluate the ways in which luxury stores operate as contemporary art institutions, and extrapolate those insights into managerial implications for other retail venues. - According to Kapferer and Bastien (2009), art is the aesthetic and social guarantor of luxury: truly a marriage of culture and luxury. - primary research site, the LV Hong Kong flagship store. focus on consumer perceptions of LV’s strategy of casting art as vital to its success—the first such research to demonstrate how consumers decode and experience a luxury brand’s positioning. We selected two LV stores in Hong Kong as our focus. We collected data over a period of two years (2006–2007) in Hong Kong using an ethnographic approach. interviewed twenty-five people in total, whose ages ranged fromyoung adulthood to middle age. - study limited to participants who regularly...
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...1. Why am I interested in the Luxury business? After years of experience in PR, advertising, branding and marketing in consumer goods ranging from skincare, eye care, tobacco, dairy products with mainly mass consumption goods in large MNC corporations. I came across different tier of products from mass, masstige, premium and I wonder what else can I do being a marketer? The concept of luxury branding has enticed and excites me. From the region where I come from not many talent can develop product but there are many talents with good skills in building and market brand. The luxury brand strategies were invented in Europe (mainly Italy and France companies), not in the United States where mass consumption goods concept was originated. With the rise in demand with a double-digit growth for luxury business in foods, travel, automobile and goods in emerging regions and fronting the growth, I see there is a potential playing field for me to be apart of the industry and propel my career further. 2. What do I expect from EMLUX? a) To strengthen my skill in general retail operation management. b) To understand the luxury business especially in terms of distribution for luxury goods, managing financial profitability. c) To position and sell aspirational story, the dream and communicating luxury. d) To decode consumers attitude, insights and segmentation towards luxury business and goods. e) To drive the premiunization agenda in emerging markets with the globalization...
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...7763/IPEDR. 2012. V46. 10 A Study on Why Luxury Goods Sell and their Effects on the Economy Seung Yoon Rhee+ Hankuk Academy of Foreign Studies, 449-854 Gyeonggi-do Yongin-si Mohyun-myun Wangsan-ri Hankuk Academy of Foreign Studies, South Korea Abstract. Despite recent global economic downturns starting from 2008, luxury goods have maintained their popularity as some of the most popular products in the world, while the sales of other goods have fallen significantly. In fact, the sales of luxury goods have increased in many cases. The aim of this paper is to identify the causes to this phenomenon, and go more in-depth into the consumer psychology of buying luxury goods. Recent statistics concerning the modern economy were examined, particularly the sales of luxury goods and their consistency in sales. After, the sales of luxury goods were studied from the perspective of consumer psychology. Luxury goods are not bought for the same reasons that normal or inferior goods are, as they do not adhere to the conventional wisdom of economical decision making. Instead, consumer decision making plays a huge role in the sales of luxury goods, particularly status consumption, and the motivations for status consumption were identified according to different types of motivations. By analyzing this data, the economic effects of luxury goods were identified. Because their primary consumer base is not affected severely by economic hardships, the sales of luxury goods are able to maintain a consistency...
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...aimed to study consumer‟s choice motivations for a branch of products in a limited area of research. Author focuses her study on a particular type of goods, affordable luxury products, and motivations of a target consumer group to buy it. Such limitation is considered adequate, as it allows us to study subject thoroughly, using smaller sample size of respondents and draw conclusions that can be used as a base for further researches. Respondents‟ group is formed by the luxury products‟ consumers. They are divided into two groups, the introverts and the extroverts, using test type questionnaire, based on Carl Jung‟s personality theory. The aim of the study is to find out a relationship between introverted and extroverted types of personality and motivations for status consumption of affordable luxury goods. The research questions are: “Does a personality trait affect motivations for consumption of luxury goods?”, “Which motives are typical for a certain type of personality?” The study brings together researches on status consumption motivations and Jung‟s the- ory of introversion - extroversion dimension of a personality by looking at possible connection between personality type and person‟s motives for consumption. The short theoretical frame of reference is presented by previous researches made on luxury goods consumers‟ segmentation by Han et al., Husic and Cicik; and researches 6 on status consumption of...
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...and Vanessa Friedman interview leading figures at the FT luxury summit in Monte Carlo FT.com/luxury-video SPECIAL REPORT | Monday June 15 2009 www.ft.com/business-luxury-2009 Slimming all the rage as belts tighten Haig Simonian investigates the problems faced by luxury goods conglomerates in the current market F or years, equity analysts urged Johann Rupert to spin off tobacco and turn Richemont, the company he chairs and controls, into a “pure play” luxury goods group. In 2008, the independently-minded Mr Rupert finally took heed and returned Richemont’s stake in British American Tobacco to shareholders, leaving his group focused on Cartier jewellery, Montblanc pens and much else. Today, some of the same pundits are regretting the loss of those high and stable BAT dividends, as the world’s luxury goods industry struggles with its biggest challenges in decades. Demand has tumbled virtually across the globe with no clear sign of recovery. Manufacturers from LVMH Möet Hennessy Louis Vuitton, the world’s biggest luxury goods group, to Italy’s Bulgari, find themselves saddled with stubbornly high costs, leaving little room for manoeuvre. Even beauty has proved vulnerable, contrary to the common claim, as figures for L’Oréal and others show. On top of the market problems, the sector faces tough secular change. Globalisation has put a premium on size – but sheer mass risks diluting the exclusivity that is luxury groups’ key feature. The grim economic backdrop has also...
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...rattle off a list that includes a limited-edition sports car, a round-the-world trip or a million-dollar beachfront home. Goods by Gucci, however, top the lists of luxury brand lovers. That's according to an online survey conducted late last year by The Nielsen Company, a market research firm. It asked 25,000 consumers in 48 countries which luxury brand they would buy if money were no object. Besides Gucci, respondents chose Chanel, Calvin Klein, Louis Vuitton and Christian Dior (other-otc: CHDRF - news - people ). It's easy to see why Gucci reigns. Worldwide sales, though recently tapered, have jumped since Mark Lee became president of the company in 2004, then CEO the following year. In 2007, sales increased 11%; that's on top of a 17% increase in 2006 and a rise of 18.4% in 2005. Gucci is a part of the Gucci Group, which has a number of fashion brands in its portfolio, including Yves Saint Laurent and Sergio Rossi. PPR, a French holding company publicly traded on the Euronext exchange in Paris, owns the Gucci Group. Complete List: World's Most Desirable Luxury Brands Video: CEO Spotlight: Gucci "Gucci manages to offer high fashion and very commercial items," says Michael Macko, fashion director at Saks Fifth Avenue (nyse: SKS - news - people ). "That red and green stripe is some of the most iconic luxury branding ever created, and people want a piece of it." Behind The Brands Born as a leather goods company, Gucci is now most well known for its logo-ed handbags...
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...Swatch Group 1 Professor: Rolf Butz 10/28/2008 International Business BADM 455 Section 2 Swatch Group 2 Table of Contents Executive Summary .............................................................................................................. 1 Introduction ......................................................................................................................... 5 History ................................................................................................................................. 5 Industry Analysis .................................................................................................................. 7 Company & SWOT Analysis ................................................................................................ 11 Current Situation &Global Market ..................................................................................... 17 Competitor Analysis ........................................................................................................... 23 Recommendation............................................................................................................... 26 Conclusion ......................................................................................................................... 29 Methodology ...
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...Chongqing Sichuan Guizhou Source: China National Statistics Bureau, BBDO Analysis 3 As the economy expands and breaks into new ground… …the luxury category is also following suit -- it is achieving high growth simply by getting MORE PEOPLE TO BUY LUXURY GOODS FOR THE VERY FIRST TIME… 4 Luxury spending growth is driven by CATEGORY FIRST-TIMERS DECONSTRUCTING LUXURY SPENDING IN CHINA Source: Bain Luxury Market Survey – China 5 The crucial role of China’s BURGEONING MIDDLE CLASS % SHARE OF URBAN HOUSEHOLDS by income group (in RMB) % SHARE OF LUXURY CONSUMPTION by income group (in RMB) Source: McKinsey & Co. 6 How can they AFFORD LUXURY GOODS What is driving THEIR INTEREST IN LUXURY ? 7 China’ s middle class have a MINDSET THAT IS CONDUCIVE Optimism Ambition Loving of Life for luxury goods & services 65% feel their life will be better in the next 12 months. 42% say they work or study harder in order to succeed. 87% find it important to experience new things & enjoy life. Source: BBDO Voices 8 Their is a desire that is much stronger than THEIR EARNING POWER 49% 62% Say they long for luxury goods despite not being able to afford them right now. The figure specifically among 20 to 25 year olds. Source: TNS China 9 They SAVE UP for luxury products “ I thought about it for a very long time, and bought an LV bag. But my husband said if you carry it, others will think it is fake...
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...The Concept of Luxury Brands by Klaus Heine Technische Universität Berlin, Department of Marketing Prof. Dr. Volker Trommsdor Wilmersdorfer Str. 148, 10585 Berlin, Germany Phone: +49.30.314-29.922 • Fax: +49.30.314-22.664 Email: Klaus.Heine@marketing-trommsdor.de • Internet: www.marketing.tu-berlin.de Heine, Klaus (2011) The Concept of Luxury Brands, Technische Universität Berlin, www.concepto uxurybrands.com. Edition: 1.0 This paper is published as the rst part of the serial publication Luxury Brand Management ISSN: 2193-1208 Editing & Review: Bartek Goldmann and Kate Vredenburgh Cover page: Kevin Duggan Acknowledgements: Dr. Steen Herm. I would like to thank the following people for their support and constructive criticism: Prof. Dr. Volker Trommsdor, Prof. Dr. Reinhold Roski, Dr. Vera Waldschmidt, Demet Tuncer, by Klaus Heine (2011); Copyright by Klaus Heine. All rights reserved. Apart from any fair dealing for the purpose of re- search or private study, or criticism or review, no part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, scanning, or by any information storage or retrieval system, without permission in writing from the author. Technische Universität Berlin, Department of Marketing, Wilmersdorfer Str. 148, 10585 Berlin, Germany, Tel: +49.30.314-29.922, Fax: +49.30.314-22.664 Contents List of Figures . . . . . . ...
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...Fashion Management The Swedish School of Textiles 2012-06-01 Report no: 2012. 13. 21 Luxury Consumer behaviour Suvi Lukkarinen & Xing Wei - A Comparative Case Study of Emerging Luxury Markets in China and Finland Visiting adress: Bryggaregatan 17 Postal adress: 501 90 Borås Website: www.textilhogskolan.se Title: Luxury Consumer Behaviour -A Comparative Case Study of Emerging Luxury Markets in China and Finland. Publication year: 2012 Authors: Lukkarinen, Suvi and Wei, Xing Supervisor: Anita Radon Abstract The study on luxury consumers is always connected to their drives behind consumption. Why people buy luxury products is an interesting question. This thesis investigates influencing forces behind luxury consumer behavior, in a comparative case study on Chinese and Finnish consumers. Luxury consumption is not a new phenomenon, but in some countries, like China and Finland, the luxury market is still growing since many brands are newly entering these markets. At the same time, new generations have become luxury consumers so these markets are quickly changing. Researches have been made on luxury consumer behaviour in China and Finland. However, there is a lack of updated information available about this subject, especially about Finnish luxury consumers. Furthermore, the driving forces behind the luxury consumption are not the same in different countries. In a competitive industry like luxury fashion, the marketing tactics have to be adapted to specific market conditions in...
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