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This paper examines how luxury fashion brands renew themselves in order to balance the exclusivity that isassociated with luxury goods and with profit maximization. Using consumers’ demand theory it is shown how luxuryfashion brands go through different phases to renew the perception of exclusivity. A proposed model for the stages aluxury brand goes through to keep up the perception of exclusivity is provided. The focus is on identifying howluxury fashion brands renew themselves in order to create a perception of exclusivity and scarcity. The limitations ofthe study is that research has yet to be done on how consumers of luxury fashion goods perceive these efforts putforward by luxury fashion brands. Problems associated with luxury fashion brands,




Erin AllemanLindsay HuffAshley SchulerAmanda WoodrowTHE MARKETING SITUATIONLouis Vuitton Moet Hennessy - owns over sixty global brandsIn 2009, Louis Vuitton spent over $687 million in advertising, making them the 58th largest advertiserCurrently the leading luxury brand provider in the world

THE MARKETING SITUATIONLouis Vuitton Moet Hennessy Chairman and CEO, Bernard ArnaultSales have increased since the beginning of the recessionPerfumes and cosmetics grew eight percentThe watches and jewelry sector of the company increased 12 percent, which is said to be caused by other brands also in the Moet Hennessy Corporation No Vuitton bag has ever been marked down

Operating Income of LVMH relative to its primary competitor.THE CELEBRITY AD CAMPAIGN

CAMPAIGN OBJECTIVESExpand the target marketSatisfy the emotional needs of current and prospective customers for status and luxuryIncrease revenue

CAMPAIGN OBJECTIVESTo refresh and reintroduce this 150-year-old brandKeith Richards as a rock music legend and Madonna as an international icontargets a broader age demographic of their target audience

The PSSP hierarchy of needs as it pertains to the Louis Vuitton target audience.THE TARGET AUDIENCEWomen of a non-specific ethnic groupBetween the ages of 25 and 55It all comes down to status & flaunting affluence.

THE TARGET AUDIENCEDemographic variables age, race, gender, & incomeGeographic variables regions and size of state and or countyNo set state or county sizemore prevalent in larger metropolisesPsychographic variables interest in club membershipshoppingfashionmediaAchievementsBehavioristic variablesbenefit expectations brand loyalty

SIX MAJOR STRATEGIES OF PRODUCT POSITIONINGBased on product features crme de la crme, highest quality & statusBased on benefits, solutions or needs quality, statusFor a specific usage occasion everyday, work, clubbing, dinner out, school, work, etc.For a specific user category affluent men & women between the ages of 25 and 55, status and ego-oriented individualsAgainst another product playing up the benefits of owning a real Louis, rather than a competing luxury brand (they never name their competitors, they simply portray their brand as being in a league of its own)For product class disassociation comparing it to its direct competitors in the luxury industryTHE CREATIVE STRATEGYGoal is to refresh and reintroduce a 150-year-old brandUse of celebrities for different age groups and genres It is also said that the campaign with Keith Richards, restates travel as the fundamental and defining value of Louis Vuitton, interpreting it as a personal journey. THE CREATIVE STRATEGYThe celebrity campaign reinforces the idea that these luxury items are not necessarily intended for purchase by everyone.Celebrities are good symbols to use when trying to illustrate status.Celebrity advertising campaigns make consumers desire the status associated with the brand. Desire to branch out of traditional target market.

THE MEDIA STRATEGYMain Objectives define their luxury brandbuild a solid marketing foundation keep their audience engaged in the products

THE MEDIA STRATEGYThe celebrity handbag campaign of 2008-2009Keith Richards, MadonnaWord-of-mouth marketing Use of traditional media vehiclesbillboardsFirst-time 90-second commercialsPrint Ads featured in popular magazines such as People, InStyle and ShapeTHE MEDIA STRATEGYUltimate goal is to achieve brand resonanceLouis Vuitton spent $687.3 million on advertising in 2009 (Marketer Trees 2009).

THE MEDIA STRATEGYBrand monitoringDiscover the customers needs in real time on the social web Discover consumer sentiment and their media perceptionsOTHER COMMUNICATION PROGRAMSThe Social MediaUse of creative designs, colors, and logo placementFacebook account 68,942 friendsIn-store marketing tacticsCharity event celebrating the brands 150th birthdaypercentage of its sales donated to the American Red Cross

Figure 1: Emotion CurveLouis Vuitton Retail StoreEVIDENCE OF RESULTSStill #1 in luxury industryFashion and leather goods division accounts for thirty-five percent (35%) of the companys $8.4 billion total divisional revenueSales in the fourth quarter of 2008 rose 6% to 7%Reputation has catalyzed its sustainability during difficult economic times

EVIDENCE OF RESULTSHigh amount of brand recognition and brand resonancecult-like circle to which Louis owners belongThe luxury industry has only been phased slightly by the sluggish economyCelebrity advertisements maintain favorable consumer perceptionsOpening new boutiquesREFERENCES"Luxe Strategy: Luxury Brands Using Social Media". Fashionably Marketing. November 12, 2009 . Scott, Lesley. "Fashion Tributes". November 12, 2009 . Bowser, Jacquie. "OgilvyOne scoops Louis Vuitton global digital accout". Brand Republic. November 1, 2009 . "LVMH Moet Hennessy L.V. (LVMUY)." Wikiinvest. 2009. Web. 6 Nov 2009. . Wendlandt, Astrid. "WRAPUP 1-Hermes, LVMH bring relief to luxury sector." Reuters. 6 Feb 2009. Web. 7 Nov 2009. .Gumuchian, Marie-Louise, and Mathilde Gardin. "Louis Vuitton "very optimistic" on Christmas sales." Reuters. 7 Oct 2009. Reuters, Web. 7 Nov 2009. .Marketer Trees 2009. Advertising Age. Web. 18 Nov. 2009. http://adage.com/marketertrees09/.http://stylenews.peoplestylewatch.com/2009/06/30/sneak-peek-madonnas-fallwinter-louis-vuitton-ads/http://www.customerthink.com/blog/louis_vuitton_effective_experienceImages courtesy of: http://dgimanagement.com/blog/wp-content/uploads/2009/07/louis-vuitton-madonna-fall-winter-2009-ad.jpg, http://worldclassshitty.files.wordpress.com/2009/08/keith_richards1.jpg, http://earsucker.com/wp-content/uploads/2009/06/madonna_louis_vuitton_new_campaign_ad.jpg