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Marketing case of lvmh
- 2. Company Profile Market and Industry Company Performance Marketing Issues Challenges in Asia Addressing solutions Key solution implementation Content
- 3. Company Profile Market and Industry Company Performance Marketing Issues Challenges in Asia Addressing solutions Key solution implementation Content
- 4. Founded “House of Louis Vuitton” in 1854 Headquartered in Paris Louis Vuitton merged Moët Hennesy in 1987 Distinguished five business lines • Wines & Spirits • Fashion & Leather • Watches & Jewellery • Perfumes & Cosmetics • Selective Retailing Operated around 1500 stores and 50 Brands over the world Company Profile
- 5. Company Profile Market and Industry Company Performance Marketing Issues Challenges in Asia Addressing solutions Key solution implementation Content
- 6. LVMH Gucci Richemont Bulgari Hermes Main market Asia-Pacific Europe, North America, Japan Europe US, Japan, Asia-Pacific Outside French, Japan Stores 1500 348 99 200 No. of brand 50 10 19 4 Luxury products goes up high quality and unique design in the world ( Total spending $88 billion) The main customers shift from exclusive to middle class Market and Industry (World) $26.0 $26.7 $28.8 $40.7 $0.0 $5.0 $10.0 $15.0 $20.0 $25.0 $30.0 $35.0 $40.0 $45.0 2001 2002 2003 2008E Financial Wealth of Millionaires Worldwide (trillions)
- 7. Market and Industry (Asia) Japan • Stores 47 • Mature market China • Stores 16 • Business chance • New lifestyle India • Stores 22 • Economic growth • Culture difference South Korea • Stores 15 • Young age customer As high potentials. middle class with having stable income and the increased of population exist in Asia market. Although Asian market is attractive, each countries has difference environment and behavior.
- 8. Company Profile Market and Industry Company Performance Marketing Issues Challenges in Asia Addressing solutions Key solution implementation Content
- 9. Company Performance -500 - 500 1,000 1,500 2,000 2,500 3,000 2001 2002 2003 Income from Operation by Business Group Selective Retailing Watches & Jewllery Perfumes & Cosmetics Fashion & Leather Goods Wines & Spirits Income increased, but sales flactuated for 2001-2003 Reduction administrative cost Financial condition remained stable not improve - 2,000 4,000 6,000 8,000 10,000 12,000 14,000 2001 2002 2003 Sales by Business Group Selective Retailing Watches & Jewllery Perfumes & Cosmetics Fashion & Leather Goods Wines & Spirits
- 10. 27% 20% 17% 15% 15% 6% 26% 21% 17% 16% 13% 7% Sales by Geographical Regions 2002- 2003 America Europe (excl.France) France Japan Asia (excl.Japan) Other Regional shares are relatively equal Sales results remain over years Asia market slightly reduced Company Performance
- 11. Strengths Weaknesses High brand value Large global distribution network 50 luxury brands Wide range of product lines High sales in different regions Key player in Asia-Pacific Limited distribution in Asia Focus mainly in big countries Some products do not suit local taste Opportunities Threats Prosperity on the rise Fast growing economies New middle-class customers Japan remain strong consumption High competition Macro-problems (political, culture,…) Counterfeit products Gray market in Japan SWOT Analysis
- 12. Why was LVMH sales unchanged while demand was growing in Asia?
- 13. Company Profile Market and Industry Company Performance Marketing Issues Challenges in Asia Addressing solutions Key solution implementation Content
- 14. French culture in Asia market Diversification of lifestyles in Asia especially new entrepreneurs Narrow distribution in Asia excl. Japan Marketing Issues Japan China India S. Korea No. of store 47 16 22 15
- 15. Company Profile Market and Industry Company Performance Marketing Issues Challenges in Asia Addressing solutions Key solution implementation Content
- 16. Challenges in Asia Counterfeit Products Gray Market in Japan Different Customer behavior in Asia Cultural and lifestyle difference Economic and Political Risk
- 17. HOW to IMPROVE in Asia market?
- 18. Company Profile Market and Industry Company Performance Marketing Issues Challenges in Asia Addressing solutions Key solution implementation Content
- 19. Addressing solutions Solution Pros Weight Cons Weight Product customization and Government interference • Suit local tastes • Fix counterfeit problem • Increase sales 4 • Long time to build relationship with Governments • High investment -2.5 Production in China and India • Reduce production and distribution costs 3 • Lower brand image • High management investment -2 Price differentiation by regions and social classes • Expand customer range • Higher market penetration 4 • Lower brand image • Encourage gray market -1.5 Enhance brand and customer values and distribution network • Suit local taste • Enhance market penetration • Improve brand image 4.5 • High capital investment -1
- 20. Addressing solutions Solution Pros Weight Cons Weight Product customization and Government interference • Suit local tastes • Fix counterfeit problem • Increase sales 4 • Long time to build relationship with Governments • High investment 2.5 Production in China and India • Reduce production and distribution costs 3 • Lower brand image • High management investment 2 Price differentiation by regions and social classes • Expand customer range • Higher market penetration 4 • Lower brand image • Encourage gray market 1.5 Enhance brand and customer values and distribution network • Suit local taste • Enhance market penetration • Improve brand image 4.5 • High capital investment -1
- 21. Company Profile Market and Industry Company Performance Marketing Issues Challenges in Asia Addressing solutions Key solution implementation Content
- 22. Customer Value and Relationships Segmentation TargetingDifferentiation Positioning Product Promotion Place Price SEGMENTATION Young people, old people, new entrepreneurs, lineage wealthy people and middle class buyers TARGETING Young people, new entrepreneurs, middle class buyers DIFFERENTIATION Products based on lifestyle and culture. Designs in bags and fragrances in perfume for example POSITIONING Positioning products that can be bought to celebrate success and for social status people, new entrepreneurs, lineage wealthy people and middle class buyers Quality products with differentiation Should not compromise in price. Continue charging the same price Promotion through testimonials and celebrity events. Setting up more stores in financial hubs such as Shanghai, Mumbai etc. Marketing Mix & STP approach
- 23. Key solution implementation Sustain luxury brand image, remain premium price strategy Exclusive luxury events to promote brand Testimonials Strengthen advertisement in high-end channels Enhance Brand value
- 24. Key solution implementation Improve customer benefit to gain loyalty and reduce impacts from counterfeits VIP club/ high value membership Lifestyle activities (parties, Xmas,..) Enhance customer values
- 25. Key solution implementation Dragon Elephant Sakura Assimilate indigenious cultural elements into product design to cater for local consumers’ tastes. Foster local market by embedding the European way of living and lifestyle into the Asian culture. Product customization based on lifestyle/culture Improve customer benefit to gain loyalty and reduce impacts from counterfeits
- 26. Enhance brand and customer values and distribution network Capture more customers, enhance brand, reduce counterfeits Key solution implementation Producers India China S.Korea Japan Wholesaler/ Stores Wholesaler/ Stores Wholesaler/ Stores Wholesaler/ Stores CUSTOMERS Unified System Vertical Marketing System Prime & Flagship stores
Notes de l'éditeur
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