Louis Vuitton In India

PRESENTED BY: GROUP 1JUBANLAK J KHARJANA – PGP30200PIERRE MARIE DUMAINE-IEP16002PREET KOMAL SINGH – PGP30332

THÉO CAPOUL‑IEP160001SUMAN SANYA – PGP30346

SUMIT PRAKASH – PGP30120SWAPNIL PATIL – PGP30158

Company Background

Created in 1854, Louis Vuitton sell flat topped trunk with canvas cover

In 1987, merger with Moët Hennessy and the group LVMH is born

Diverse range of leather accessoires and goods

A mass of brands : Fendi, Marc Jacobs, Kenzo, Givenchy, Celine…

Distribution and sales is very much controlled

14 production workshops and 382 stores (3 in India)

India Entry: Market Size

Produc

t Segment

• Luxury products segment of market (watches, jewellery, high end electronics, wines, spirits, perfumes, apparel, personal accessories) estimated to be $444 million & growing at 20% annually

Market

Size

• Overall size of Luxury market (including car, homes, yachts, vacations, etc.) was about $4billion & expected to grow to $30 billion by 2015

Potential

Custome

r

• 20000 families with annual income more than INR 100 million in 2001-02• 83000 HNW individuals (liquid assets of $1 million or more) in 2005, and recorded world’s second fastest growth in the

number of HNWs (19.3% in 2005)New

custome

r Group

• Cocooners- potential new customers undergoing change in their spending habits, estimated to go up to 583 million by 2025

Luxury Consumers Segment

1. For superior functionality & quality• wealthier, older, extensive pre

purchase search, logical buying decision, willing to pay premium for high value

2. As a reward

• status symbols, personal statement that they have “arrived”, highly driven by desire to succeed, but keen on not appearing lavish

3. As means of self-Indulgence• feel good actor, emotional buying

decision, not concerned with product longevity or value, younger consumers, and males are more than females

American Express study- the mindset of the Indian consumer was a desire to prove that “I have made it”- placed in 2nd category

Problem Statement

1. Retail Outlets

Physical presence of Louis Vuitton in India. What are the alternative they have?

2. Marketing Strategies

What should be marketing strategies to identify and develop (influence) more customer in Super rich category ?

3. Newer Customer Profile

Should they enter into any new customer profile segment?

1. Physical Presence Of Louis Vuitton In India-All Alternative

ALTERNATIVE 1: EXPAND THROUGH LUXURY MALLS

Pros Cons

larger store size very few luxury Malls in India

less expensive to operate potential windows shopper

Tapping into larger customer base

possibility of non-luxury stores next to LV

adequate customer traffic potential lost of Exclusiveness

ALTERNATIVE 2: EXPANSION THROUGH LUXURY RETAIL CLUSTER

Pros Cons

Maintain LV’s Exclusiveness very few LRC in India

More visibility to target customer

limited customers

ownership of the Store more expensive to operate

Control over LV’s store design Require more Investment

Inference: Expanding through Luxury malls include the possibility of having a larger customer base that fit the profile of LV’s target market.

Inference: It will help in positioning the brand in the customer’ mind. It allows LV to have a better display of its products and a greater visibility to its customers.

Physical Presence Of Louis Vuitton In India-All Alternative

ALTERNATIVE 3: EXPANDING THROUGH MORE HOTELS

Pros Cons

Experience in doing so losing other expansion possibilities

Less Costly less visibility

targeting both locals and foreign

less control

Awareness of LV’s Status limited customers

ALTERNATIVE 4: OPEN LV’S INDEPENDENT STORES

Pros Cons

More Flexibility to company Costly

flexibility in designing LV’s stores

Troublesome

More visibility and a more precise targeting of customers

very loose regulatory framework on property ownership

Legal Disputes

Inference: LV’s original choice of expanding through hotels in India is understandable, as it allowed the company not to expose itself to India’s uncertain environment and maintain the LV’s standing as an exclusive luxury brand.

Inference: In doing so, the company will not be relying on existing infrastructure and will be fully in control of its destiny in the Indian market

Physical Presence Of Louis Vuitton In India-Recommendation

ALTERNATIVE 5: A COMBINATION OF THE ABOVE STRATEGIES (BEST ALTERNATIVE):

Pros Cons

Flexible Not consistent

Meeting India’s realities

Reaching a large audience

Adjustable and less risky

Inference: In the absence of both LRC, luxury malls and without the possibility to locate in a luxury hotel, LV may choose to create its independent store as its last alternative, should that market really be worth the effort

2. Marketing strategies: objectives

Awareness: The goal is to make the ‘new elite’ aware of the brand.

Exclusivity: To show that Louis Vuitton is a premium brand that distinguishes the target(super rich and the near rich) from other lower tiers of the population.

Deliver the message: ‘I have succeeded’, ‘I made it’ – this theme will give the sense of achievement for those who aspire to own one Louis Vuitton

Prestige Event : Fashion Week

Brand awareness: To increase the brand awareness, create some Fashion show like a Fashion week in Metro City.

Goal: To make people aware of the brand with a typical ‘French theme’.

Dinner: Organizing a special dinner only for exclusive audience. Super rich & near rich audience will be invited and asking them to pay for ‘exclusive dinner by Louis vuitton only for select few‘. This will increase the credibility of the event and will separate niche audience from others

Bollywood Movies:

Product placement: Due to the influence of Bollywood Movies in Indian society, it will increase the brand awareness to the whole society.

Pro: People will aspire to buy it like they dream about when they see something big in movies

Con: Could portray Louis Vuitton as a common brand

Successful Indian Women as

ambassador:

Influence: Take an influencial woman who have been successful, who is also a role model. A strong, successul woman will show that ‘When you have a Louis Vuitton, you succeed in overcoming the problems and make it even if you are a woman’

Example: This ambassador can typically be someone like Indra Nooyi (CEO of pepsico)

LV Exclusive Card:

• Cards to those people who are already familiar with the brand.

• Different cards relate to your level of purchase (Silver, Gold, Platinum)

• This card will have some advantages and extra services

• Increase the brand loyalty and the feeling of the exclusivity

3. Newer Customer Profile

“Cocooners” segment:

Limited to the middle class

Numbering 97 million, would rise up to 583 million by 2025

Income levels and spending habits were high

Potential to develop a taste for luxury and become loyal consumers

Fact: Country’s per capita income is below the unit price of a LV product

Cocooners - Details

How To Target This New Segment

New product line at lesser price

Bringing in more variety

Make brand more attractive to younger generations as 51% of population is below 25 years old

Shift from super expensive luxury to affordable high class desire

Thank You !