Louis Vuitton marketing strategy and the emerging luxury market in China

Louis Vuitton (LV) is the world 1st luxury brand and the leading brand of the LVMH group created in 1987, which was the 1st world group for luxurious goods' production and distribution. LVMH, ?16.5 billion sales worldwide in 2007 (+7.7%), is far ahead of the competition with revenues three times bigger than its close competitor, Richemont Group. The group is split in five core activities with a rich portfolio of over 60brands. Fashion and leather goods, with ?5.6 billion sales accounting for 34 % of the group turnover, are the group's growth engine. LV dominates the luxury segment by far with ?1.659 billion turnover in 2006 (2 times its two main followers PPR and Valentino), and owns 405 stores (+15 net openings 2008).

Tags: Chinese luxury goods, Luxury goods in china, Luxury market, Louis Vuitton marketing mix, Louis Vuitton target market

[...] Originality = guaranty of quality (’made in’) and authenticity (‘designed by’) The emerging, dynamic, and fast moving luxury market in China is challenging in terms of cultural, demographic and geographic dimensions for the Louis Vuitton’s Marketing strategy. C. Marketing Strategy Louis Vuitton has been one of the first movers among luxury brands by making its emphatic entry into the market in 1982. It established its first exclusive concept store in Hong Kong and then trailed on towards the continental side in Beijing’s Peninsula Hotel in 1992. [...]

[...] LV has already established 9 ’landmark boutiques’ in the three storeyed China World mall, and shall continue its expansion in this format. Promotion: The promotion campaigns have to be limited in numbers in order to preserve the brand its products, its selectivity, relative scarcity, and prestige perception. The finest quality of the scope, the message, and the support has to reflect the brand image. LV’s promotion is about branding rather than the product. Despite some local adaptation, LV’s target is always international. [...]

[...] Nevertheless, as Carcelle stated ’luxury brand is not only about creativity and innovative products, but also historical legitimacy.’ This intangible value is the core resource of the house in which Louis Vuitton developed its marketing strategy so as to differentiate it from the others. This was done with the awareness that LV already owned a unique competitive advantage that only few rivals could assert. Marketing mix The strategy regarding the LV marketing mix will be challenged by the complex dynamic Chinese market. [...]