Louis Vuitton Moet Hennessy – Case Study Example
Louis Vuitton Moet Hennessy (LVMH) Case The key drivers of performance in luxury goods business include brand power and heritage. Furthermore, the intense competition generates remarkable strategies that sustain the business of luxury brands and encourage key players to participate in a more competitive manner. The success recipe in this industry looks like having the vital ability to hit the button and that is to target the segment for high net-worth individuals together with aggressive expansion to potential multiple regions by offering them diversified portfolio of luxury brands, which obviously are among of the excellent moves that LVMH performs.
To nurture its leadership position, LVMH adheres to the value of excellence by employing talent, audacity and thoroughness as published in its annual report (Ramaswamy 6). In other words, it is not just only about providing competitive brands and successful retailing strategy, but employing the combined management of skills and resources as the potential reasons why LVMH nurtures its leadership position. Creativity and innovation, and partnership and acquisition on the part of LVMH clearly resulted to employing more talented human resources, acquiring abundant resources and promoting successful quality distribution of actual product offerings, which lead further to the company’s competitive advantage in its industry.
LVMH businesses include wines and spirits, fashion and leather goods, fragrances and cosmetics, watches and jewelry and selective retailing. The quality of this portfolio can be characterized under the level of successfully highlighting brand power and heritage, which is an action that also has become the potential source of synergy.
LVMH is having an ambitious plan to double its sales and profits in the next five years. Concerning this, one important strategy is to first undergo a more thorough customer analysis that will lead to discovering potential market segments that remain unexplored as of today. This will most probably lead to potential increase of LVMH’s market share in the long run.
Ramaswamy, Kannan. “Louis Vuitton Moet Hennessy: In Search of Synergies in the Global Luxury Industry.” Thunderbird: School of Global Management (2003): 1-15. Print.