Louis Vuitton
Corporate credo
Luxury leather goods maker Louis Vuitton was established in Paris in 1855. For more than a century and a half, the company made quality, handcrafted luggage and other leather goods. It remained a small, family-controlled company until the 1970s, when French businessman Henry Racamier married a Vuitton heiress, and rapidly expanded and diversified the business. When Racamier took over in 1977, the company had only two shops in France and had combined sales of less than $50 million. By the mid-1980s, the company had 95 stores across the globe and revenues topping $500 million.
Personalisation has been a tradition at Louis Vuitton since 1854. Hand-painted stripes and monograms in rich, vibrant colour give a unique elegance to Louis Vuitton hard-sided luggage. Artistic lettering does more than merely identify luggage and travel accessories; it gives them a distinctly personal character. Using the finest tools and meticulous artistry, our expert painters create striking travel pieces that bear the stamp of exclusivity.
The Louis Vuitton leather goods collections are produced in workshops located in France, Spain, and the United States. Manufacturing the footwear and Ready-to-Wear collections takes place in France and Italy. Their watches are exclusively made in timepiece workshops in Switzerland. Their jewellery collections are realized in France, Italy and Switzerland. Sunglasses are manufactured in France and Italy. In all of these workshops, the choice of the finest materials, experienced craftsmen and the extreme care devoted to all manufacturing phases of their item, perpetuate and renew their tradition of excellence and refinement.
LVMH has consistently pursued a luxury pricing strategy, which means high markups, limited availability, and few if any markdowns. When asked by a reporter whether the Louis Vuitton store in Paris would have a post-Christmas sale, the company’s president Yves Carcelle answered "No," saying, "That would devalue the brand." Louis Vuitton sells its products only through a global network of company-owned stores. This keeps margins high and allows the company to maintain control of its products through every step in the channel. Bernard Arnault explained, "If you control your factory, you control your quality; if you control your distribution, you control your image." Today, LVMH maintains a global network of 1,286 stores, a 28 percent increase over 1999.
Based on informal surveys by asking the audience most people say they don’t enjoy, some even say hate, the shopping experience at LV stores. Though no one would deny that Louis Vuitton is a successful brand, it doesn’t seem that a good retail experience is being delivered. Yet, it is said that the bad retail experience is consistent and synchronized with all other touch-points in delivering the unique brand values to target customers, or simply put, an effective experience.
An effective experience fulfills two conditions: it creates positive emotions and memories to target customers; and, at the same time, it delivers target brand values.
In dealing with the clients from entering to exiting the store there are some sub-processes like ‘store outlook and interior decoration’, ‘product’, ‘price’, ‘service’, and ‘feeling of prestige.’ Louis Vuitton does an excellent job in advertising, public relations and celebrity events to create their luxurious and exclusive image, and the actual experience with store outlook and interior decoration, product and prestige feeling are synchronized with customer expectations and echoed through Louis Vuitton’s brand values.
What is the ‘pain point’ at Louis Vuitton retail stores? Besides price, from the responses I received, it’s the ‘attitude’ of the salesladies—unless you’re a celebrity or dress and look like a ‘rich’ person—they usually ignore you. It was proved that this is a consistent experience across the globe, not country or region specific. However, the pleasure peak is projected at ‘prestige feeling’, part of this feeling could be constituted by observing how the rich & famous are being served and how the normal customers are being ignored inside the store. None of us like to be ignored, but since the pain is so intense, the way we are treated is one of our critical needs.
Kahemann’s Peak-End Rule states we could remember only the peak and end moments during an experience. Though we’re suffering from being ignored, our pleasure peak is at the feeling of prestige; one of the most critical needs of Louis Vuitton target customers. This feeling is the key brand value, the effective memories of a Louis Vuitton retail experience are highly positive both to customers and to the brand. In this sense, Louis Vuitton is delivering an effective experience.
Most customer process cycles can be divided into three stages: prospecting, buying, and consuming. Again, for simplicity’s sake, we will simply locate the key touch-points in Louis Vuitton’s case, i.e. advertising, public relations, celebrity events, website, retail stores, products, and call center.
Recently, Louis Vuitton built several flagship concept stores located on high-fashion avenues around the world like Rodeo Drive and Fifth Avenue. These stores sell an estimated average of $1,800 per square foot. Some of the best-selling stores sell as much as $8,000 per square foot. Additionally, since maintaining an upscale image is vital to a luxury brand, LVMH devotes over ten percent of annual sales to promotion and advertising. The company advertises its brands primarily in fashion and lifestyle publications. Some of the leading brands sponsor major international events with luxury cachet, as Louis Vuitton does by sponsoring the America’s Cup. Since image is an essential part of marketing luxury goods, LVMH is careful to evaluate every advertising and promotional opportunity for consistency with the image of its brands. As a result, the company manages a portfolio of luxury brands unparalleled in both size and sales.
Louis Vuitton’s chief executive Yves Carcelles once said: “Our brand is about reliability, quality, style, innovation and authenticity.” But that may not complete, according to Richard Wachman of London’s The Observer: “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.” In short, the essence of a luxury good is its exclusivity, i.e. not everyone can afford it, only a small group of people can enjoy it, and Louis Vuitton pushes exclusivity to the extreme.
Corporate credo
Luxury leather goods maker Louis Vuitton was established in Paris in 1855. For more than a century and a half, the company made quality, handcrafted luggage and other leather goods. It remained a small, family-controlled company until the 1970s, when French businessman Henry Racamier married a Vuitton heiress, and rapidly expanded and diversified the business. When Racamier took over in 1977, the company had only two shops in France and had combined sales of less than $50 million. By the mid-1980s, the company had 95 stores across the globe and revenues topping $500 million.
Personalisation has been a tradition at Louis Vuitton since 1854. Hand-painted stripes and monograms in rich, vibrant colour give a unique elegance to Louis Vuitton hard-sided luggage. Artistic lettering does more than merely identify luggage and travel accessories; it gives them a distinctly personal character. Using the finest tools and meticulous artistry, our expert painters create striking travel pieces that bear the stamp of exclusivity.
The Louis Vuitton leather goods collections are produced in workshops located in France, Spain, and the United States. Manufacturing the footwear and Ready-to-Wear collections takes place in France and Italy. Their watches are exclusively made in timepiece workshops in Switzerland. Their jewellery collections are realized in France, Italy and Switzerland. Sunglasses are manufactured in France and Italy. In all of these workshops, the choice of the finest materials, experienced craftsmen and the extreme care devoted to all manufacturing phases of their item, perpetuate and renew their tradition of excellence and refinement.
LVMH has consistently pursued a luxury pricing strategy, which means high markups, limited availability, and few if any markdowns. When asked by a reporter whether the Louis Vuitton store in Paris would have a post-Christmas sale, the company’s president Yves Carcelle answered "No," saying, "That would devalue the brand." Louis Vuitton sells its products only through a global network of company-owned stores. This keeps margins high and allows the company to maintain control of its products through every step in the channel. Bernard Arnault explained, "If you control your factory, you control your quality; if you control your distribution, you control your image." Today, LVMH maintains a global network of 1,286 stores, a 28 percent increase over 1999.
Based on informal surveys by asking the audience most people say they don’t enjoy, some even say hate, the shopping experience at LV stores. Though no one would deny that Louis Vuitton is a successful brand, it doesn’t seem that a good retail experience is being delivered. Yet, it is said that the bad retail experience is consistent and synchronized with all other touch-points in delivering the unique brand values to target customers, or simply put, an effective experience.
An effective experience fulfills two conditions: it creates positive emotions and memories to target customers; and, at the same time, it delivers target brand values.
In dealing with the clients from entering to exiting the store there are some sub-processes like ‘store outlook and interior decoration’, ‘product’, ‘price’, ‘service’, and ‘feeling of prestige.’ Louis Vuitton does an excellent job in advertising, public relations and celebrity events to create their luxurious and exclusive image, and the actual experience with store outlook and interior decoration, product and prestige feeling are synchronized with customer expectations and echoed through Louis Vuitton’s brand values.
What is the ‘pain point’ at Louis Vuitton retail stores? Besides price, from the responses I received, it’s the ‘attitude’ of the salesladies—unless you’re a celebrity or dress and look like a ‘rich’ person—they usually ignore you. It was proved that this is a consistent experience across the globe, not country or region specific. However, the pleasure peak is projected at ‘prestige feeling’, part of this feeling could be constituted by observing how the rich & famous are being served and how the normal customers are being ignored inside the store. None of us like to be ignored, but since the pain is so intense, the way we are treated is one of our critical needs.
Kahemann’s Peak-End Rule states we could remember only the peak and end moments during an experience. Though we’re suffering from being ignored, our pleasure peak is at the feeling of prestige; one of the most critical needs of Louis Vuitton target customers. This feeling is the key brand value, the effective memories of a Louis Vuitton retail experience are highly positive both to customers and to the brand. In this sense, Louis Vuitton is delivering an effective experience.
Most customer process cycles can be divided into three stages: prospecting, buying, and consuming. Again, for simplicity’s sake, we will simply locate the key touch-points in Louis Vuitton’s case, i.e. advertising, public relations, celebrity events, website, retail stores, products, and call center.
Recently, Louis Vuitton built several flagship concept stores located on high-fashion avenues around the world like Rodeo Drive and Fifth Avenue. These stores sell an estimated average of $1,800 per square foot. Some of the best-selling stores sell as much as $8,000 per square foot. Additionally, since maintaining an upscale image is vital to a luxury brand, LVMH devotes over ten percent of annual sales to promotion and advertising. The company advertises its brands primarily in fashion and lifestyle publications. Some of the leading brands sponsor major international events with luxury cachet, as Louis Vuitton does by sponsoring the America’s Cup. Since image is an essential part of marketing luxury goods, LVMH is careful to evaluate every advertising and promotional opportunity for consistency with the image of its brands. As a result, the company manages a portfolio of luxury brands unparalleled in both size and sales.
Louis Vuitton’s chief executive Yves Carcelles once said: “Our brand is about reliability, quality, style, innovation and authenticity.” But that may not complete, according to Richard Wachman of London’s The Observer: “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.” In short, the essence of a luxury good is its exclusivity, i.e. not everyone can afford it, only a small group of people can enjoy it, and Louis Vuitton pushes exclusivity to the extreme.