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A Presentation on the luxury fashion Conglomerate LVMH By: Nitesh Srivastava Sanchayeeta Choudhary Surbhi Modi Vishakha Negi

LVMH Mot Hennessy Louis Vuitton S.A. (LVMH), is a French holding company and one of the world's largest luxury goods conglomerates. It is the parent of around 60 sub-companies that each manage a small number of prestigious brands. The group was formed after mergers brought together champagne producer Mot et Chandon and Hennessy, a leading manufacturer of cognac. In 1987, they merged with fashion house Louis Vuitton to form the current group. The group is partly owned by the Christian Dior group, and Bernard Arnault is Chairman and CEO of both companies.

To represent the most refined qualities of Western "Art de Vivre" around the world. In view of this mission, five priorities reflect the fundamental values shared by all Group stakeholders: - Be creative and innovate - Aim for product excellence - Bolstertheimageoftheirbrandswithpassionate determination - Act as entrepreneurs - Strive to be the best in all they do

In 1743, one of the descendants of the nobles Mot brothers, Claude Mot, founded the Maison Mot. His grandson, Jean Rmy Mot, transformed this trading company into the world's leading luxury brand which, has been the veritable embodiment, around the world, of the genius of champagne. Mot & Chandon is still, and more than ever before, the symbol of pleasure, grandeur and pure celebration. LVMH held 40% of the cognac market and 20% to 25% the overall champagne market.

Louis Vuitton, a trunk-maker in Paris since 1854, became a legend in the art of travel by creating luggage, bags and accessories as innovative as they were elegant and practical. A century and a half later, the legend is embodied by the Monogram canvas, and played a starring role in the development of modern luxury. Louis Vuitton is now active in other creative spheres like: ready-to-wear, shoes, watches, jewellery. Under the artistic direction of Marc Jacobs, the new collections met with immediate success and renown. 60% of sales in this division are concentrated in the Asia-pacific region.

Innovation The House Christian Dior's designs dresses, creates perfumes and invents make-up looks for women. Sexy Make-Up Dior created the "Looks", complete ranges of products evolving as seasons go by. Each year, new collections offer daring creative and vibrant shades. Beauty Skincare Dior set up its own research laboratory: Dior Science. At the Innovation Centre, 200 experts work each day to create and develop more and more efficient products. Dream Fragrance There is a Dior fragrance to suit each woman, whether she is sophisticated, sensual, natural or elegant Daring as well as floral, Dior fragrances all express a state of mind, a way of life.

From a small workshop in the Swiss Jura mountains, TAG Heuer has transformed into a watch making legend. Recognized throughout the world for its luxury sports watches and pioneering work in chronographs . TAG Heuer watches epitomize prestige and performance and brilliantly fuse technology with design.

DFS Group Limited is the world's leading luxury retailer catering to the travelling public. Its strength lies in its strategic brand partnerships, groundbreaking store and product development, superior assortments, and targeted marketing programs. DFS covers the world, employing more than 6000 people in its offices, DFS Gallerias, airport shops, and other stores.

Groupe Les Echos has several business, finance, arts, culture publications: Les Echos Investir Investir Magazine Investir.fr Capital Finance Radio Classique Connaissance des Arts CLASSICA Le Salon des Entrepreneurs Les Echos Confrences Les Echos Formations Les Echos Editions Les Echos Institut

LVMH draws an estimated 80% of its profits from Vuitton, thus propping up less-successful units, from the DFS duty-free retail chain to couturiers Christian Lacroix and Givenchy. Their wine/spirits unit possessed the number one champagne/cognac, and even more importantly, the unit shows signs of a growing market. Their fashion/leather goods outpaced many of their key rivals. The perfume/cosmetic unit witnessed an increase in growth rate, and led to an opportunity for LVMH but they were only ranked #7 in the industry, giving them something to work to improve. Parfums Christian Dior, demonstrating its exceptional image and its roots in the world of couture, once again outperformed its competitors.

Fendi had continued the growth curve experienced in 2007 and that the Marc Jacobs, Donna Karan, Kenzo, Pucci and Loewe labels had all performed strongly. Chaumet, the prestige jeweler on Place Vendme in Paris, continues its targeted global expansion. Fred enhances its identity as a contemporary jewelry designer and De Beers affirms its positioning as a diamond jeweler.

The famous luxury brands LVMH controls: Champagne, Wine, Cognac, And Brandy Moet & Chandon Fashion Dom Perignon Hennessey

Fragrances Cosmetics

Berluti Christian Lacroix Givenchy Louis Vuitton Donna Karan

Christian Dior Givenchy Hard Candy Fresh Urban Decay Ebel Tag Heuer

Watche

LVMH Chairman Bernard Arnault, it has already quintupled sales and increased margins sixfold since he bought the company in 1989. LVMH Mot Hennessy Louis Vuitton, the worlds leading luxury products group, recorded revenue of 7.8 billion in the first half of 2009, reflecting a slight increase over the same period in 2008 despite the crisis and a high comparable. Profit from recurring operations came to 1,363 million. It increased tangibly in the brands that control their distribution, like, for example, Louis Vuitton. But the real winner of the quarter was the watches and jewelry group , which posted 12% revenue gains over the year-earlier period. Strength came from brands including TAG Heuer, Zenith and the Christal collection from Dior. The company added that Chaumet and De Beers also continued their retail expansion plans and increased revenues.

Their products, and the cultural values they embody, blend tradition and innovation, and kindle dream and fantasy. What makes Vuitton unique, in fact, what makes the most profitable luxury brand on the planet is the relentless focus on quality. There's the rigidly controlled distribution network. Jacobs' fresh, unfussy aesthetic was a perfect fit, and the new ready-to-wear and shoe lines that he has introduced draw younger customers in the door. Jacobs teamed up with Japanese artist Takashi Murakami on a multicolored line of bags, incorporating images like cherry blossoms and eyes into the traditional LV monogram and adding shiny metal trim. They have some elements that are striking, while retain the history. LVMH produced products that nobody needed, but that were desired by millions across the world.

In order to achieve long-term success, LVMH decided it would best be achieved through artistic creativity, technological innovation, and attention to detail. Image meant priceless and irreplaceable. There are five main aspects to the strategy of LVMH, they are product quality, innovation, image, craftsmanship/production process, and risk tolerance. Louis Vuitton is also selling a certain idea of France a brand that represents a mythical France, one of which neither the French nor the outside world can get enough. The theme of the last Louis Vuitton fashion show "Girl with the Monogram handbag"has the colors and textures inspired by Vermeer and the golden age of Dutch painting.

Vuitton must build sales in the U.S. while tapping into rising affluence in China and India. Vuitton tried to outpace its rivals as it carefully opened boutiques around the world. Arnault is especially pleased that the U.S. stores, which once posted 75% of their sales to Japanese tourists, now are thronged with local shoppers who account for 85% of sales. That's helping Vuitton reduce its risky dependence on Japanese customers. Vuitton's sales in Japan grew 12% last year -- respectable, but lower than companywide sales growth. LVMH recently launched its watch & jewellery division in India. TAG Heuer and Christian Dior, two of the group's star brands, will herald their entry into the country, said to be an extremely important and promising market for them.

China has become the biggest market for Hennessy cognac and is the second largest customer base for Louis Vuitton worldwide. The Groups more recent moves are also very promising. Glenmorangie and Benefit have been hugely successful in Asia, Sephora in Eastern Europe, Marc Jacobs in Europe, Hennessy in Vietnam etc.

Japan: Must win market.(Triad) They are big buyers of luxury brands. Japan accounts for 33% of fashion and leather category. 20% of Christian Diors sale is from Japan The brand image is everything in Japan were there is little difference between the rich and the poor. Large percentage of single, working women. China: Has a huge population. Growth rate of 8% and negative inflation rate. Policies of the govt are favourable for luxury brands. Annual growth rate of premium cosmetic market was a significant 30%.

Yes , if the purchasing power of the new middle class increases then it is good for LVMH as the customers who can afford it increases . But LVMH should reach this market segment without tarnishing its brand. They should not decrease the price of their products. Maintain only exclusive shore rooms.

With their other business acquisitions, LVMH was able to pick up print publications, newsletters, a radio network, an advertising company, press agency, and Internet sites. Think Louis Vuitton, and what comes to mind is most likely, it's those glossy ads -- the ones with supermodels draping their lithe frames over Vuitton luggage against a striking gold-andturquoise dese

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