Louis the company. Since the prices of Louis Vuitton

Louis
Vuitton is a global leader in luxury goods. What started as a well-established
luxury handbag company in France, became something much, much larger as Louis
Vuitton established a name for themselves all over the world. As the company
has globalized and built a name for themselves, they have also expanded their
product line from leather bags and trunks to ready-to-wear items, accessories,
jewelry, shoes and luggage sets. The Louis Vuitton customer is one that is
wealthy, want to uphold an image and are willing to pay the price, which is why
they choose a well-known and easily recognizable designer to show that status
to others. After the terrorist attack on September 11, 2001 in the US, sales
declined greatly since foreign travel decreased as well as trade from the US to
Japan, a hugely popular location for Louis Vuitton sales. Similarly, another major
issue that occurred was the 2008-2009 worldwide financial crisis, and Louis
Vuitton took a small hit from this. They, along with some other luxury brands,
did end up lowering prices in December of 2008 when they realized that their
historical prices would not do them any good during this time. Demand and sale
of luxury products did decrease during this global recession. Other issues that
surfaced as Louis Vuitton success rose was the issue of counterfeit products
that are produced and sold at a much cheaper cost than the real product which
takes many customers away from the company. Since the prices of Louis Vuitton
products is so high due to quality of manufacture and the brand name you are
paying for, those that didn’t have as big of a budget as traditional customers
had their way of getting that status that comes with the ownership of Louis
Vuitton products. Along the same lines, Louis Vuitton houses most manufacturing
plants for their products in France which has very high labor costs due to the
quality that they are producing. This is part of the reason why costs are so high
and in turn why prices for the customers are so high. Louis Vuitton saw very
large success in Japan in the 1980s when Japan had an economic boom.

Ready-to-wear was extremely popular there.

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As
far as unexpected global events (Sept. 11 terrorist attack and financial
crisis) go, Louis Vuitton did all that they could to improve the situation for
consumers so that they could uphold the integrity of the company while also
still being able to reach and serve consumers. Lowering the prices to help
consumers adjust to the financial crisis was a great move for Louis Vuitton
because they were able to show that they care about their customers and value
them. Price is a hugely important part of the Louis Vuitton brand because high
price means high quality and exclusivity which is exactly the image that Louis
Vuitton wants to uphold globally. However, creating products, or maybe a new
product line, that are slightly more affordable could add a new segment into
the Louis Vuitton customer- the middle class. Another great thing that Louis
Vuitton already does if offering limited edition products which they should
continue to do to keep the attention of previous consumers as well as catching
the attention of possible new consumers. One thing they could do to improve
this process is to offer a sort of VIP membership with the Louis Vuitton brand
to offer them a first look at new products or give them the opportunity to
order them before they go public. This could either be a free membership or one
that is paid or that you must spend X amount of dollars to maintain this
membership. This will show consumers that they are valued by the Louis Vuitton
company and they want to treat them better than the general public and
encourages them to stay loyal to Louis Vuitton. To combat counterfeits, there
is not much that Louis Vuitton to slow or stop the making of these fake bags or
clothing. One thing that Louis Vuitton could do to deter customers from buying
counterfeits is to encourage people to buy straight from them in their
advertising. From previous research on Louis Vuitton, I am aware that they will
not repair counterfeit bags and will send your bag back to you and say they
cannot help because of this. One way they could encourage customers to then go
and purchase from the company directly could be to offer a discount on products
that are not their most expensive products, last year’s designs, etc.

Essentially items that are not the most valuable right now according to sales
either globally or where the customers are from since different geographical
locations most likely don’t sell exact amounts of each individual product. To
combat high manufacturing and labor costs due to manufacturing pants being in
France, Louis Vuitton could strategically place new manufacturing plants around
the world where sales are high and there is a large amount of store to lower
manufacturing costs. Quality is important to them which is why I would suggest
that they are very thorough with training and selection of workers. This may be
expensive and a big investment for Louis Vuitton, but in the long run labor
costs cuts will greatly benefit Louis Vuitton.

 

Louis
Vuitton continues to make great decisions to both uphold their brand image
while keeping customers coming back for more through their limited-edition
products, creation of items outside of just bags and trunks, taking advantage
of the Japanese market, and much more small changes they have made throughout
the course of the Louis Vuitton brand lifetime. However, one perspective they
have not taken in marketing towards families. It was mentioned in the case that
a children’s line was being considered. This is a great idea but it could be
widened to reach more than just children clothing. Since a trend was seen in
Japan for an increase in ready wear, it would be a good idea to take this idea
and run with it globally. It was seen in the past as well that when a new idea
has success or high demand in Japan, the rest of Louis Vuitton customers also
enjoy the product which was the case with the 2003 spring/summer colorful
collection in collaboration with Takashi Murakami. Taking this into
consideration, Louis Vuitton could create a family friendly, limited edition
ready wear line. Depending in the success of the line it could become permanent
or even become a new private label within the LVMH company. This family friendly
line would still be high quality to stay in line with Louis Vuitton brand but
would be a little more affordable so it wasn’t only upper class that could
afford it. Reaching the upper middle class, should this private brand be
created or the family collection continue, would be beneficial to Louis Vuitton
because it would create a whole new target market for them to create products for
while keeping quality at the forefront of their products. To keep costs down,
as suggested before, manufacturing could take place in countries where labor is
less expensive than where products are currently being made for this less
expensive line of products. People who maybe couldn’t afford Louis Vuitton in
the past or that were willing to pay the price will be more willing to pay for
the name on the clothing but will be satisfied with that lower price point.

While still limited edition this ready wear line could be sold exclusively
online and down the line in pop up shops around the globe if it does well
initially. Then further implementation could be taken to make the line more
permanent, such as selling to high end retail stores such as Nordstrom. Should
this family oriented ready wear line not be successful, Louis Vuitton could
take the VIP membership route discussed earlier to further involve previous
customers in the company. Since customers are the most important part of the
company’s success, they may want to feel more valued which could in turn result
in more sales or stronger identification with the brand.

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