Cécile LE GOFF
Charlotte VESIN
The Company
Louis Vuitton
• Early Days (1854-1892)
– 1854 - Louis Vuitton opens first store in Paris
– 1892 - Vuitton dies; the Vuitton company begins selling
handbags.
• Golden Age of Louis Vuitton (1893-1936)
– 1893 - Georges (Louis’s son) begins his campaign to make the
company into a worldwide corporation.
• Modern Age of Louis Vuitton (1937-1996)
– 1978 - Vuitton opens its first stores in Japan
Followed by many others international stores
– 1987 - Moët et Chandon and Hennessy, merges with Louis Vuitton.
Creating LVMH
– 1989 – LVMH become Bernard Arnault property
– 1992 - The first store in China opened at the Palace Hotel in Beijing.
• Millennium Age of Louis Vuitton (1997-present)
– 1997 - hires designer Marc Jacobs to be the label's artistic director
– Today –The brand is said to be worth $ 19.781 billion
Louis Vuitton Facts and Figures
LVMH revenue : 17 billion $
Louis Vuitton revenue: 2,9 billion $
LVMH value: 44.1 billion $
LV value: 19.781 billion $
LVMH Statement
• “LVMH must continue to be
synonymous with both elegance and
creativity. Our products, and the
cultural values they embody, blend
tradition and innovation, and kindle
dream and fantasy.”
• Louis Vuitton Strategy:
• Sell in their own shop only
• No sales
• To set up in a new country each
year
Louis Vuitton in China
• Chinese are the first LV customer
• LV has more than 30 shops in
China
• Chinese favorite accessory brand
• Chinese are the second biggest
luxury consumer
Brand ranking - China
BMW
Louis
Vuitton
Mercedes-Benz
Rolex
Giorgio Armani
Ferrari
Rolls-Royce
Bentley
Cartier
Vacheron Constantin
Competitive environment
Who are the customers?
– Women & Men
– From 25 to 65 years old
– Earning about $5,500 or
above per month
Customers
with high
revenues
Customers
that save
to
purchase
Suppliers
• Leather producer, Fabric
producer…
• Key relationship with each of them
• Proximity
• Reliable supplier
The Competition
Kenzo
Chloe
Yves
Saint
Laurent
Dolce &
Gabanna
Fendi
Giorgio
Armani
Christian
Dior
Louis
Vuitton
Gucci
Hermes
Balenciaga
Givenchy
Chanel
Marc
Jacobs
Versace
The Key Success Factors
• High end Product
• Excellence
• The Know how
• Innovation
• The notoriety & the image
Key success factors in China
• Understand the Chinese market:
– understanding the “why” that drives
luxury purchases
•
Enhance the brand image
– Reputation
• Sell the excellence of the product and the
culture behind it
– “Chinese consumers are inquisitive.
They want to know why something
is a good product.”
• Train the employees
Competitive advantage with Chinese people
• Collections which does not often change
= profitable Purchase
• LV is their favorite brand fashion and
accessories
• Rich Asiatic :
– Big reputation and
– wear visible outside brands
• Label France : excellent reputation
Pourquoi LV attire les chinois
• Collections qui ne change pas souvent = le sac ne
va pas vite être démodé = Achat rentable
• Louis Vuitton est leur marque préférée (mode et
accessoires)
• les riches Asiatique souhaitent surtout acheter les
produits de luxe possédant une grande réputation et
portant des marques extérieures visibles
• Le label France à une excellente réputation et colle
parfaitement aux idéaux de la cible chinoise en
matière de luxe : le romantisme, le savoir faire et la
longue histoire des marques.
Louis Vuitton vs Counterfeit
Luxury market in China
• Economy of 10 billion $
• 40% of Chinese consumers buy luxury products in
their own country
• Target : 20 to 40 y.o – essentially men
• Why ? Reputation and visibility
Luxury market in China
• In 2009, 300 luxury shops opened in the world : 15% were in China
• 78% will maintain or increase the consumption of luxury goods in
the next 12 months
• 84%bought for themselves
• 28%-38% of luxury products are aim to be be presents in
commercial relationship
Luxury market in China
• Reason of the growth :
– Changes in the values of Chinese : more
individualist
– Attraction of occidental values
– Growth of pleasure and elegance consumption
– Luxury = Face and money wealth
China attractswell-knownluxury brands
Chanel
Collection “Paris – Shanghai”
Launch of the brand “Shang Xia”
Prada
Hermès
Commercial advertisement produced by Yang Fudong
International Fashion show in Shanghai soon
Dior
Counterfeit
Imitation
Patent
infringement
Fraud
Globalization
Money loss
• Increase of pirated goods in world trade : 1.85% in 2000 to 1.95% in 2007
US$250 billion worldwide
• When calculating counterfeit products, current estimates place the global
losses at $400 Billion.
Counterfeit in China
• very well organized
network
• 2 types of counterfeit
product
• 3 types of counterfeit
production
• Fake: fully integrated in
Chinese lifestyle
Counterfeit in China
– 80% of world wide counterfeit
– 8% of the GDP
– 10% of annual industrial
production
– 16 billion $ of revenues
Louis Vuitton vs counterfeit
• Policy of zero tolerance
• Policy of information and raising
awareness of the general public
• About sixty persons dedicate
themselves completely to the fight
against the counterfeit
• Large-scale actions in China, Korea,
Thailand and in Italy
Louis Vuitton vs counterfeit
• Agreement with Rakuten
– Contribute in a significant way
to the construction of an even
more safe environment for consumer
• Ebay against Louis Vuitton
• Louis Vuitton spent last year 15
million euro in the world against
the counterfeit
Louis Vuitton vs counterfeit
Shanghai – Mars, 2009
• Three defendants :
– Wu Beiwen, shareholder of the Shanghai Zhongwen Trade Co.,
Ltd,
– her father and husband, who participated in the business.
• The court said LV claimed the defendants violated the
company's trademark rights by selling fake LV products.
• LV wants the court to
– stop the defendants selling products under its registered
trademark
– Claims financial compensation of one million yuan (about
146,200 U.S. dollars).
Ideas to lower counterfeit
• Chinese advertising campaign
about the effects and damages of
counterfeiting
• Applying a “terror policy”
• Creating more capsule collection
with limited edition products
Thank You