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By : Nimisha Karnani



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S.NO INDEX PAGE
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Abstract 2
1. Introduction
1.1 Louis Vuitton: Company profile
1.2 Mission statement
1.3 Strategy
1.4 Mergers & Acquisitions

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2. SWOT Analysis 6
3. Marketing Mix
3.1 Product
3.2 Price
3.3 Place
3.4 Promotion

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4. External Environment Analysis 12
5. Conclusion 13
6. References 14


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1. INTRODUCTION
1.1 Louis Vuitton: Company profile
Louis Vuitton Malletier, commonly referred to as Louis Vuitton or shortened to LV, is a
French fashion house founded in 1854 by Louis Vuitton. The label's LV monogram appears
on most of its products, ranging from luxury trunks and leather goods to ready-to-wear,
shoes, watches, jewellery, accessories, sunglasses, and books. Louis Vuitton is one of the
world's leading international fashion houses; it sells its products through
standalone boutiques, lease departments in high-end department stores, and through the e-
commerce section of its website.
Louis Vuitton is the world's most valuable luxury brand and is a division of LVMH. It is one
of the most profitable brands in the world with profit margins approaching 40%.For six
consecutive years (20062012), Louis Vuitton has been named the world's most valuable
luxury brand. Long-time creative director Marc Jacobs left Louis Vuitton in 2013 after 16
years in charge of the brand.Recent product endorsers of the brand include Angelina Jolie,
Muhammad Ali and Michael Phelps.
The luxury powerhouse operates some 3,385 stores across Asia (including China and Japan),
Europe, and North America. While more than a third of its stores are in Europe, Asia is the
company's single largest market, accounting for more than 35% of sales. LVMH rings up
about 30% of its sales in Europe (including France with 11%). The US represents more than
20%.

Marc Jacobs, Former designer for LV



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1.2 Mission Statement
The mission of the LVMH group is to represent the most refined qualities of Western "Art de
Vivre" around the world. LVMH wants to be synonymous with both elegance and creativity.
In view of this mission; five priorities reflect the fundamental values shared by all Group
stakeholders:
Be creative and innovate
Aim for product excellence
Bolster the image of our brands with passionate determination
Act as entrepreneurs
Strive to be the best in all that is done
1.3 Strategy
With the market for luxury goods on a tear -- especially in fast-growing markets in Asia --
LVMH is flush with cash for acquisitions and growth. The company is growing its stores
base in all of its markets, except for Japan, where it held steady at 370 shops in 2013. LVMH
added 180 stores in 2013 after adding about 165 in 2012. China is a huge emerging market
for luxury goods, including wines & spirits, and a pillar of growth for the French company.
The company has been focusing on controlling as much of its distribution across its 60 brands
as possible. LVMH has more than 3,380 retail outlets (87% are outside France). Nearly half
belong to its Selective Retailing business, which consists primarily of Sephora cosmetics
stores. About 40% are fashion and leather goods shops, led by Louis Vuitton, and also
include Fendi boutiques, and hundreds of other shops under the Celine, Givenchy,
Donna Karan, Thomas Pink, Pucci, and Marc Jacobs brands, among others. LVMH's
namesake Louis Vuitton brand, as well as Fendi and Marc Jacobs, are proving resilient in
Europe, despite the economic slowdown there, and posting strong revenue gains in Asia.
1.4 Mergers and Acquisitions
LVMH expanded its products portfolio in mid-2013 when it purchased an 80% stake in
Italian cashmere company Loro Piana for $2.57 billion, more than three times the $900
million in sales the company had expected to post in 2013. LVMH values Loro Piana for its
products' unique quality and craftsmanship and its six generations of leadership. As part of
the transaction, the cashmere company's owners will retain a stake in the business.
The company put its ample cash to good use, in late 2011 the French luxury goods firm
completed a 3.7 billion ($5 billion) tender offer for the shares of Rome-based
jeweller Bvlgari. Bvlgari is the smallest of the major luxury jewellery and watch makers and
the deal doubles LVMH's watch and jewellery business. The Bvlgari deal was announced
soon after LVMH acquired a pair of niche brands: Ole Henriksen and Nude skin care. In late
2010, LVMH bought more than 20% of the shares of its rival Hermes International. While
LVMH described the move as friendly.

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2. SWOT ANALYSIS
Strengths
1. The brand is one of the oldest fashion
houses with more than 150 years of history.
2. The brand is easily recognizable because
of its logo and monogram canvas on most of
its products.
3. The brand has its presence in most of the
large shopping hubs of the world.
4. The brand is available exclusively in its
own stores.
5. The brand also makes custom tailored
products for its few elite customers.
6. The brand has a clientele including
international celebrities.
7. Extremely high brand recall and global
presence.

Weakness
1. The brand is available only in its exclusive
stores making it difficult for people all
around the world
2. Fake imitations affect brand and sales

Opportunities
1. The company needs to adopt the current
fashion trends to stay in business
2. The company can offer once in a
year discounts for its customers.
3. Revamping LVs image from time to time
to meet contemporary tasted and styles of its
elite customers.

Threats:
1. The brand is counterfeited all around the
world
2. Economic crisis can hurt the brand sales in
a negative way.









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3. Marketing mix
3.1 Product:

The classic LV bag
The first of the Four Ps of marketing is product. A product can be either a tangible good or an
intangible service that fulfils a need or want of consumers. Whether you sell custom pallets
and wood products or provide luxury accommodations, its imperative that you have a clear
grasp of exactly what your product is and what makes it unique before you can successfully
market it.
The label's LV monogram appears on most of its products, ranging from luxury trunks and
leather goods to ready-to-wear, shoes, watches, jewellery, accessories, sunglasses, and books.
However, a Louis Vuitton handbag offers a product of distinguished quality and attention to
detail, as well as one with a story behind it. Furthermore, while general marketing places
importance on relative quality, for Louis Vuitton the concept seems to be absolute quality,
which prompts consumers to insist on "Louis Vuitton or nothing", rendering comparisons of
Louis Vuitton bags with competing products meaningless. Many of the principles for
products originated with the particular preferences and policies of the House of Louis
Vuitton, as well as the creativities of Marc Jacobs, who was the artistic director of Louis
Vuitton for a long time, and have been shared and carried on by the business corporation.
Elimination of counterfeit products
By way of enlightenment campaigns aimed at the general public, the LV Group has
conducted seminars and symposiums related to intellectual property from time to time to
retain its high-end brand name and image in the market.
Louis Vuitton knock-offs? Unforgivable! The company distributes warning notices to
imitators for using a "mock monogram" which combines dark brown colours with the
characters L and V, as well as the company logo, flowers, and stars without permission.
Louis Vuitton allies itself with the law. This is to remark on the fact that Louis Vuitton
creates highly original lines which are difficult to imitate. The company then registers these
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trademarks and designs. The design of Louis Vuitton travel bags, particularly their
arrangement, has evolved in order to do away with counterfeits.


Comparison between an Original LV and a counterfeit
Special order handbags:
Louis Vuitton has a special order service. These are custom orders for self-indulgers who
would like Louis Vuitton to make custom-made products and order-made products.
Products with Inorganic Serial Numbers
Louis Vuitton creatively names all its products. They believe that it is important to produce
the effect of having users form an attachment for the product. To cite an example of said
names, the names of districts like Soho, Broadway, Ural and Baikal. If products were given
serial numbers with just numbers and symbols, such as a product name like MG40 for
instance, then this would produce a completely inorganic resonance.
3.2 Price:

After a concrete understanding of the product offering is established pricing decisions can be
made. Price determinations will impact profit margins, supply, demand and marketing
strategy. Similar (in concept) products and brands may need to be positioned differently
based on varying price points, while price elasticity considerations may influence the next
two Ps.
General marketing demands low prices. This is achieved by reducing costs and off-shoring
production to China and elsewhere. Louis Vuitton handbags, on the other hand, are priced
high. It can be said that such high prices are unnecessary for merely stowing and carrying
things. In essence, the Louis Vuitton difference is value, not price-this being absolute value,
not relative value.


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Premium Pricing
The notion of prestige pricing shows up in the pricing strategy of Louis Vuitton. This means
that in the case of products with a low purchase frequency and where it is difficult for
consumers to judge quality such as luxury and high-end products, price is one means of
making a determination. The claim could be made that pricing by Louis Vuitton, which
reigns over the top range of luxury brands, represents prestige pricing to consumers even
though it is proper pricing for Louis Vuitton.
No Bargain Sales
Looking at markets in which bargain sales run rampant, one brand has a history of not once
holding a sale where it reduced its prices in 156 years. That brand is Louis Vuitton.
Throughout history, Louis Vuitton has not held a bargain sale even once because of its single-
minded devotion to quality. This is because the core of Louis Vuitton's pricing strategy lies in
selling products to all of the customers at the same price.
LV burns leftover goods at the end of the year. If the bags are not sold, they burn them in
order to prevent putting a lower price on them. Historically, its known that LV does not put
its pieces on sale. This is done to sustain an items value
Principle Prohibiting Sale in Value Sets
The practise of throwing in added bonuses with the products is just a variation of a price
discount. This is because if the amount of money paid is the same for cases where added
bonuses are included and cases where they are not included, then including these extras
amounts to the same as providing a price discount for the cost of the added bonus. Louis
Vuitton does not include such added bonuses. Louis Vuitton also does not engage in set sales
and does not acknowledge set sales since they lead to price discounts.
3.3 Place
Marketing is about putting the right product, at the right price, at the right place, at the right
time. Its critical then, to evaluate what the ideal locations are to convert potential clients into
actual clients. Today, even in situations where the actual transaction doesnt happen on the
web, the initial place potential clients are engaged and converted is online.
General marketing seeks to create broad distribution channels opening more stores or selling
through non-department store outlets such as mail order and volume retailers. On the other
hand Louis Vuitton, bags are only offered through limited distribution channels. One might
go as far as to say that Louis Vuitton innovated a method of selling that amounts to
controlling place and not using channels that cannot be controlled.
Prime Locations
Brands are attracted to urban area which are suited to their brand image and establish stores
there which in turn create a virtuous cycle whereby the areas image improves further and the
establishment of stores accelerates. In order for luxury brands to succeed internationally it is
essential for then to be successful. This is the exact practise is followed by Louis Vuitton.

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Operates through Flagship stores only
The establishment of large-scale flagship stores endows Louis Vuitton with bases from which
gives a more prestigious and clearer image and to thoroughly ensure a sense of high added
value. This acts as a measure to further enhance Louis Vuitton as a top brand. If Louis
Vuitton is to attempt to cover an even greater number of customers through a smaller number
of stores while avoiding tarnishing the image through excessive exposure, then it would
necessarily have to make every single one of the stores into flagship stores. This is a tried and
tested tactic for luxury brands, with Louis Vuitton's global flagship score strategy serving as
an excellent example of this. Louis Vuitton is preparing a number of strategic moves and
setups against this backdrop.
I n-store layout
Louis Vuitton is working on the long-awaited retail stores while increasing its ready fire
power in the form of in-shop placement in department stores and expanding sales. The
concept allows customers to enjoy shopping in the atmosphere of a Parisian boutique from
those days by utilizing the space of a retail store.
3.4 Promotion:
Promotion looks at the many ways marketing agencies disseminate relevant product
information to consumers and differentiate a particular product or service. Promotions
includes elements like: advertising, public relations, social media marketing, email
marketing, search engine marketing, video marketing and more. Each touch point must be
supported by a well-positioned brand to truly maximize return on investment.
General marketing looks at mass advertising in its efforts to sell at high volume. Television
commercials typify that approach. Louis Vuitton, however, does not advertise on television.
While Louis Vuitton does advertise in newspapers and magazines, these consist mainly of
image ads rather than aggressive sales ads, and more focus is given to publicity (being taken
in the media). Recent product endorsers of the brand include Angelina Jolie, Muhammad Ali
and Michael Phelps.

Angelina Jolie, brand ambassador for Louis Vuitton
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Prohibiting Television Commercials
The company says television commercials are not suitable to promote their product. There are
the problems of "reach" and "richness." Louis Vuitton values the fullness of information
talked over in rich detail by salespersons and customers, such as discussions of how to care of
bags, the features of the latest creations, etc.
Emphasis on publicity
The company conducts paid advertisements in the same way that other luxury brands do.
However, it emphasises publicity through PR in which brands and products are taken up by
the media, such as newspaper, magazines, etc more than the average brand does. For
example, prior to a store opening, a number of fashion magazines put together major special
features and the magnificent opening party was reported on extensively.PROMOTION 6:
Principle of Extravagant Parties
Extravagant parties used for promotion:
As part of Louis Vuittons promotional strategy, Louis Vuitton holds extravagant parties. The
parties are thrown in a spectacular manner the extravagance itself and the large number of
famous celebrities become topics of conversation which are rapidly picked up on by the mass
media. Even though Louis Vuitton must pay if it is to hold these, the advertising results
attained far surpass those that would be achieved through the same amount of direct
advertising costs.















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3. External environment analysis of Louis Vuitton
Demographic and Social Trends
LV utilizes demographic targeting strategy to identify its customers. LVs target markets
include both men and women aging range of young adults aged 22 years to seniors aged 65
years from the upper middle class and above. The organization has been facing numerous
challenges from demographic evolutions such as aging populations, and racial and ethnic
proportion changes in the world. Due to that, LV would have to continuously bring up new
products to cater to the changes of demands.
LV products are also a great social phenomenon in Asia comparing to France its origin
country. LV has done very well in Japan market as Japanese habitually goes after high quality
products and LVs unique monogram is also a great contribution to it. LV products is often
catered toonly a few people as it is highly priced, so no regular people can afford it.
Political and legal factors:
Due to LVs image, it has become one of the most counterfeited fashion brands in the world.
Owing to its high price, generally people cannot afford to buy it. In the recent years, no doubt
there are numerous products bearing LV initials in the streets all over the world, but only a
small percentage of the products are genuine. Lately, there has been a rise in counterfeiting
luxury products because numerous manufacturing has been shifted to countries with poor
intellectual property rights and with the opportunity provided to those countries by
technology. Although LV has taken various actions to fight against counterfeit but there are
still numerous fake LVs out there. Therefore the company has setup a team of people
responsible fully on anti-counterfeiting with the help of special investigation agencies and
lawyers.
In addition, the company is also keeping the distribution of its products in close control.
Working together with governments is among the ways to help LV fight against counterfeit.
For instance, the company, in concert with other French makers of luxury goods,has
successfully lobbied the French parliament to make the import of even one counterfeit article
a criminal offence.
Economic factors:
One of the biggest factors that affects sales of LV goods in India is the tariff. The higher the
taxes are for its goods, the smaller the incentive is to buy those goods because demand isnt
going to be as high if prices have to increase in order to make up for the tax. In order for
luxury goods to. LV targets the richest people in the country. But on the other hand, most of
the population is very poor and wouldnt be able to purchase such goods, even if they saved
up for it. However, there is a select group of rich people who would make setting up luxury
stores in India profitable because there are very few stores in India for them to go to. The
market is currently set up for an oligopoly, because the demand for goods at a luxury store
would be inelastic for anyone interested in a luxury item and there are so few stores.



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4. Conclusion
By systematically breaking down the strategy of the Louis Vuitton into the four Ps (Product,
Price, Place, and Promotion), SWOT analysis and studying the external factors that affect its
operation, I found out that the rules or principles of its brand marketing greatly differ from
that of general consumer goods. In other words, the company has successfully applied the
rules and principles required to make any luxury brand a huge success. Showing that the
current rise of Louis Vuitton is not a coincidence but rather something achieved through
strategy will surely be of interest to firms struggling with lack of brand power or those
looking to boost brand power.
In conclusion, the key to luxury brand marketing boils down to the following three points:
1. Product excellence by itself in not enough, the luxury brand must perform at an
experiential level as well. As luxury consumers evolve, not only these act as points of
differentiation, but also as substance to justify a premium value and pricing.
2. While pedigree factor is important to exuberate the years of mastery or lineage, it is
crucial to generate ongoing relevance and dynamism through the persona, PR & public-
figure factor.
3. Luxury brands must continue to maintain a certain degree of exclusivity and stature with
the paucity factor and the placement factor from the retail experience to the touch-
points it associates itself with.















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5. References
1. http://www.lvmh.com/the-group/lvmh-companies-and-brands
2. file:///C:/Users/Suresh/Downloads/WasedaBusiness&EconomicStudies_45_Nagasaw
a1.pdf
3. http://prezi.com/8ynvsvldcege/louis-vuitton-consumer-behavior/
4. http://www.luxurydaily.com/wp-
content/uploads/2013/01/Luxury_Marketing_Outlook_2013.pdf
5. http://www.theglobeandmail.com/report-on-business/international-business/european-
business/louis-vuitton-slows-expansion-to-protect-image/article8069266/