Louis Vuitton, Research Paper Example

Consumers and fashion aficionados immediately recognize the brown leather, soft canvas decorated with the LV monogram and quatrefoils as an international trope of luxury and fashion. As such, Louis Vuitton, in the eyes of many fashion experts, is considered the most valuable name brand in luxury. Unfortunately, imitation and knock-off products continue to proliferate, sold on the streets of Los Angeles and New York. In addition, rappers like Kanye West have dubbed themselves the “Louis Vuitton don.” As a result, Louis Vuitton must protect its public image in order to preserve what the brand itself stands for. In the world of marketing, strategists for luxury brands like Louis Vuitton seek to live up to the company’s Big Ideal, which represents the signature framework of companies and firms. Companies derive their Big Ideal by completing the sentence: “The world would be a better place if…” The Big Ideal does not have to be laudable or noble, as many firms such as coca cola or Sunkist attest to. Louis Vuitton germinated during the nineteenth as a travel company based in Paris, so the Big Ideal of the Louis Vuitton brand is journey (Thompson, 2011).  Travel has seemingly lost any sense of romance, thereby becoming more cumbersome than pleasurable. Such a chasm between the ideal versus reality of travel creates a vacuum for luxury brands to make a statement that appeals to various consumers.

Within the context of the global recession, travel and luxury suffered the most, which thus threatened to undermine the success of Louis Vuitton. LVHM served as Louis Vuitton’s holding company and witnessed its stock nosedive profoundly by the end of the year 2008. Despite such a decline, Louis Vuitton refused to alter its core message for what the brand stood for due to shifting temporal contexts. Louis Vuitton officials stated that it is vital for luxury brands to remain both authentic and consistent because they serve as an inert cultural reference even as contingencies change (Thompson, 2011). Rather than ignoring cultural forces, they remain beacons of a particular point of view that never vacillates or changes.

During the Digital Age and novel advertisement mechanisms in place, luxury brand advertisements are increasingly moving away from the glossy pages of high-fashion magazines that show home scenes of women donning sunglasses and a Louis Vuitton bag casually slung on their arms. Rather, the marketing and advertising world has developed into a more decentralized, disjointed, and hectic matrix involving social media, smart phone applications, and internet advertisements that target a certain audience. The challenge that Louis Vuitton currently faces is the navigation and negotiation of a high-culture message and mass technologies that have inundated the marketing world. This strategy uses the concepts of roots and wings in order to create such a cultural message that the brand stands for. The concept of wings represents their desire to advance and develop in the near future while the roots refer to the back story of the brand that the consumer must be reminded of time and again. These tensions must be managed in order for agencies to act effective. While Louis Vuitton still pervades the glossy pages of high-fashion magazines, it has also encroached into the mass-marketing world through the mobile application called Amble. This application allows users to follow their favorite celebrities who document their experiences in various cities, thereby living up to the travel Big Ideal. It also enables users to devise online journals with text, photos, and videos. As a result, Louis Vuitton is highly selective of who they choose to endorse. Famous travelers such as Keith Richards, Sean Connery, and Bono are highly regarded by Louis Vuitton because they are aligned with what the brand stands for (Thompson, 2011).

Many luxury brands such as Louis Vuitton have extended their product lines in order to feature a variety of goods. Such a decision, however, is a calculated one. Brand extensions often add currency to a luxury brand only if it is reasonable and practical, yet they also can confuse the consumer if a random product line change renders a “false impression” of the brand’s voice and mission statement (Lamb, 2011). As such, it is hard to ascertain whether such line extensions stretch too far, especially since many extensions are not successful in the long run. Marketing strategists and brand executives must make a judgment call regarding whether or not a product line extension would be viewed by consumers as an enhancement of the brand’s flavor or it they perceive it as an attempt by the brand to encroach on a new category.

A product line refers to various products manufactured by one company. An effective way for a company to expand their business is by adding products to the main product line because consumers are more likely to buy products from a brand that is well-known and that they are already familiar with, For example, Louis Vuitton’s main product line includes a variety of items such as leather handbags and wallets, luggage, and makeup bags. These products are all closely related, and once this main product line grew in popularity, Louis Vuitton expanded its product line from monogram to include a variety of others to include monogram denim, monogram multicolore, monogram venis, and damier canvas. These various product lines translates into various types of products available in the Louis Vuitton brand, including shoes, jewelry, timepieces, sunglasses, agendas, scarves, belts, and accessories.

Within the Louis Vuitton brand, there are three different levels of product. The outer level includes the augmented product, warranties, customer care, gift wrappings, and service. As such, how customers are treated upon purchasing Louis Vuitton items is situated in this outer level. The middle level features the actual product in which fashion, brand, durability, quality, and the lines of product are located. At the center is the core product, which enhances the notion of luxury. The company focuses on placing premium prices on its products in order to amplify the company’s image as a poignant selling point for Louis Vuitton products. As a result, Louis Vuitton products never go on sale regardless of supply and demand levels. The price range for Louis Vuitton handbags ranges from five hundred dollars to three thousand, seven hundred dollars, and the price range for wallets oscillate between two hundred and seven hundred dollars. All Louis Vuitton stores are considered free-standing and direct channels, and the distribution of the coveted goods are considered quite exclusive. Several high-end department stores such as Macy’s New York, Saks Fifth Avenue, and Bloomingdales sell Louis Vuitton products. Because of the exclusive distribution, very few retailers and stores are able to sell such products to customers.

Target Audience and Stakeholders

Louis Vuitton’s mission statement calls for the company to evince both creativity and elegance vis-à-vis the product line. Louis Vuitton products embody a certain set of cultural values and blend innovation and tradition together in order to create products that appeal to customers’ desires, fantasies, and dreams. With this mission statement in mind, the company has five major priorities that unequivocally reflect the values shared by all company stakeholders: to be innovative and creative; to create products with excellence in mind; to buttress a brand image using passion and determination; to act as sound entrepreneurs; and for the company to strive to be the best in the industry. Louis Vuitton cogently uses demographic information as an integral part of its targeting strategy at particular customers. Data reveals that the company appeals to both men and women between the ages of twenty two and sixty five years of age. The average income of customers per month is five thousand five hundred dollars per month, so the brand primarily targets a more elite audience.  Within its marketing strategy, the main selling points the company touts is that its products are durable and fashionable goods that have a long product life and are high-quality. The notion of exclusivity is underscored, as the brand name is imbued with a sense of prestige that makes the customer not only feel good but also gives the sense that they fit into an elite, high-class society, thereby appealing to a sense of power and ego.

Brand Strength

The strength of Louis Vuitton brand lies in its ability to stay relevant even in a constantly evolving fashion world in which competing brands continue to emerge while knock-off products threaten to undermine it. Promotion efforts by the Louis Vuitton Company underscore personal selling while deemphasizing sales promotion in order to reinforce the brand’s luxury image. Personal relations have launched a variety of campaigns in order to further popularize the name of the brand through websites, magazines, sporting events, and award shows. Advertisements appeal to the luxury image of the brand, and the dissemination of such advertisements appear in high-end magazines such as Elle and Vogue fashion in addition to specially placed billboards in certain locales. Among the most renowned endorsements include Jennifer Lopez, Scarlett Johansenn, Kate Moss, and Uma Thurman. However, the proliferation of imitation Louis Vuitton products has unequivocally adversely impacted the sales and efficacy of marketing strategies. Indeed, fake Louis Vuitton products pose a persistent problem, and the company is forced to spend over ten million dollars a year on the so-called rip-off battle with companies manufacturing the fake products. A large portion of that money, however, is awarded to lobbyists. The primary markets that produce counterfeits come from China, Turkey, and Morocco. As such, Louis Vuitton has embraced a zero-tolerance policy with regards to counterfeit products, which, in 2004, led the firm to take over thirteen thousand legal actions, six thousand raids, and approximately nine hundred and fifty arrests.

Beyond staying relative and responding to modern exigencies, the company makes a conscious effort to set prices in response to the perception of value of the consumer. Understanding, assessing, and capturing customer value perceptions and competitor strategies when setting product prices is critical in strengthening a brand. Because Louis Vuitton is a high-luxury brand, higher prices yields higher profits since decisions made by consumers with higher disposable income make decisions based on the perceived market value and brand equity rather than merely on functionality. This trends happens because luxury items enhance the image of the buyer predicated on the perceived value, as higher costing items are perceived as being of higher value. Owning Louis Vuitton in the eyes of consumers functions as a status symbol that signifies one’s capacity to afford such high-costing, luxury items, thereby providing a psychological boost, heightened self-confidence, and an amplified ego and self-esteem. This fundamental principles have been widely accepted as the norm since royalties existed, thereby forming the foundation of pricing strategies deployed by luxury brands. Louis Vuitton germinated during the mid-nineteenth century and created product lines based on handbags and trunks. The seminal moment in the trajectory of the Louis Vuitton brand as a luxury brand. The appearance of the Monogram Canvas line made Louis Vuitton a luxury brand because of the necessity of the company to deploy innovative marketing strategies in order to remain competitive. Louis Vuitton sought to appeal to the emotions of consumers by fomenting a memorable experience of the brand. Such a tactic aimed at fostering customer loyalty via quality products, distinct packaging, pricing, and a sense of the brand’s storied history.

Louis Vuitton’s pricing strategy has been pinpointed as the most important factor in the brand’s success in a competitive market for luxury items. The high prices of Louis Vuitton items has been linked to the high quality of the products, which has enabled the brand to attract high-end consumers. Louis Vuitton have never been on sale or sold at reduced prices, which has confirmed the luxury of LV items. In addition, all Louis Vuitton items are extensively tested in order to ensure that all products maintain high quality. To remain at the apex of the luxury brand market, Louis Vuitton products are manufactured by both mechanized and manual labor. To enhance their brand image, Louis Vuitton adheres to a pricing increasing strategy in order to appease their high-end customers while getting rid of low-end platforms. This willingness to reduce potential profits by eschewing mass-selling luxury brands techniques reveals the intent of Louis Vuitton to maintain and strengthen its image as the greatest luxury brand.

References

Keller, K.L. (2000). The brand report card. Harvard Business Review, 147-157.

Lamb, R. (2011). How far is too far with brand line extensions? Luxury Daily. Retrieved September 12, 2015 from http://www.luxurydaily.com/how-far-is-too-far-with-brand-extensions/

Quelch, D.A. & Kenny, D. (1994). Extend profits, not product lines.  Harvard Business Review, 16-23

Thompson, D. (2011). Behind Louis Vuitton: Behind the world’s most famous luxury brand. The Atlantic. Retrieved September 12, 2015 from http://www.theatlantic.com/business/archive/2011/05/branding-louis-vuitton-behind-the-worlds-most-famous-luxury-label/238746/