Let's find out how Louis Vuitton Is still at the top of its game regardless of its high price and competition.
1. Introduction
You may surely visit Louis Vuitton stores if you value the representation of the newest trends and originality, where you can discover the most delicate designs of shoes, leather clothing, purses, jewelry, and accessories, among other things. They are the most well-known and well-known luxury brands in the world. How did Louis Vuitton become so successful? Was it about properly implemented plans in all aspects of their businesses? Without a doubt. Let's talk about positioning tactics in general by looking at Louis Vuitton's marketing and targeting techniques.
Louis Vuitton, a luxury clothes and trendy accessories company founded in 1854, is the market leader in garments, ready-to-wear leather products, timepieces, footwear, accessories, and sunglasses. It works in far more than 60 countries throughout the world, with over 500 outlets in each of these countries. Louis Vuitton is a fashion-forward brand that employs a combination of demographic and psychographic segmentation tactics. LV has adopted a differentiating targeting approach to meet the evolving demands of its clients. It has always positioned its products as a sign of distinction and has earned a strong reputation throughout time. To attract potential clients in the market, LV employs value-based positioning methods.
2.Market Segmentation of Louis Vuitton
Louis Vuitton divides their customer base into demographic groups based on age, gender, and disposable income. Louis Vuitton specifically targets women aged 18 to 54 with high yearly salaries of $75,000 or more, indicating considerable discretionary money. To better define their target market, Louis Vuitton employs psychographic segmentations such as lifestyle and reasons. Louis Vuitton, for example, caters to jet setters, trendsetters, and those seeking prominence.
Louis Vuitton divides its customers into groups based on their usage habits, with heavy users receiving special attention. At the time of sale, buyer information is captured and stored in a database. To stimulate repeat brand image and brand loyalty, heavy users are provided seasonal catalogs as well as invites to purchase unique product collections.
Demographic Segmentation: It is a method of dividing people into groups based on their age. Louis Vuitton caters to both men and women, ages 16 to 80, who are rich. High-income and disposable-income businessmen and women.
Psychographic Segmentation: Louis Vuitton employs psychographic segmentation based on such as lifestyle and reasons. People in nations like China and Brazil must display their social rank and money. These clients are drawn to Louis Vuitton for status reasons. The next group is trendsetters and fashionistas. Louis Vuitton's ultimate strategy is lifestyle segmentation. "The Art of Traveling" became a new motto for a luxurious lifestyle. Because traveling is an art form, owning a Louis Vuitton item makes you a part of it.
Rate Segmentation-Usage: Louis Vuitton divides its customers into groups based on their usage habits, with heavy users receiving special attention. At the time of sale, buyer data is retrieved and stored in a database. To facilitate future sales and brand loyalty, heavy users are provided seasonal catalogs as well as invites to purchase unique product collections.
3. Targeting of Louis Vuitton
The rich middle-aged ladies from 35 to 54 years old are the first sector of Louis Vuitton's target market, while trendy young female adults from 18 to 34 years old who have saved enough money to buy one wish are the second. The average Louis Vuitton consumer is a high-level & social-class individual who is fashion-conscious. Possessing Louis Vuitton merchandise confers a high social prestige. Louis Vuitton places a premium on the material's quality, as well as the designs and craftsmanship of its goods. As a result, the product's cost price gradually skyrockets. Louis Vuitton adopts a premium pricing approach to price its items since the brand's target clientele are elite and upper-middle class. Customers are willing to pay high costs since the brand and its goods make a fashion statement.
Demographic segmentation was employed by Louis Vuitton to separate the market. It categorizes the market into several life phases based on age, gender, and income. Louis Vuitton has a distinct life stage in which its fashionable and high-quality clothing and accessories are worn by the wealthy and elite. Louis Vuitton's major target market is for wealthy people with a five-digit salary after required expenses have been paid and a home has been purchased.
4. Positioning of Louis Vuitton
Strategy Positioning is an important tool for every business to use when developing a marketing strategy. It infects the crucial marketing mix process, allowing a firm to obtain a competitive edge as well as a huge market share. As a result, it must be given top consideration while developing a marketing strategy. Furthermore, positioning is both an artistic expression that is critical to gaining and maintaining a customer's loyalty and trust. Typically, items are positioned according to the requirements and desires they frequently satisfy or the advantages they give to their respective clients.
In this perspective, it is clear that Louis Vuitton (LV) bases its product positioning on fashion and the most recent trends. Louis Vuitton's products are created with the newest market trends and current fashion in mind, allowing clients to discover the latest trend-based offerings and high-quality items. Louise Vuitton emphasizes exceptional quality, with an emphasis on long-term usage pleasure. There are several instances where retail firms unintentionally make defective items. In these situations, a high-priced product may appear useless, discouraging customers and leaving them unsatisfied. As a result, Louis Vuitton formed the Repair Service Sector.
5. Mind Map
Consumers are ready to pay the price because they believe the company's items to be of great value. Louis Vuitton places a premium on the material's quality, as well as the designs and craftsmanship of its goods. As a result, the product's retail cost gradually skyrockets. Louis Vuitton adopts a premium pricing approach to price its items since the brand's target clientele are elite and upper-middle class. Customers are willing to pay high costs since the brand and its goods make a fashion statement.
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6. Key Takeaways
Louis Vuitton is one of the most prestigious and well-known fashion brands. Louis Vuitton, a leather designer, founded it in the year 1854. It was a pioneer in the fine leather business in the twentieth century. It has a network of more than 460 locations in 50 countries, specializing in high-end merchandise. From 2006 until 2012, it was ranked as the most established luxury company in the world.
Louis Vuitton has secured a distribution channel that is exclusive to them. Their goods aren't available in any department shops. The corporation is a firm believer in having its retail outlets. Louis Vuitton's highly educated salespeople are taught to handle their customers with great care. They serve their consumers with respect and provide them individual attention. Because they have a restricted number of stores, customers must walk up to them. Because the distribution chain is shorter, the corporation saves money by having fewer Louis Vuitton locations. You can also make a mind map like this or even better with EdrawMind. They have countless free pre-made templates for you to choose from and work your way within 5 minutes, even if you are a beginner.
7. References
FAQs
How does Louis Vuitton use segmentation? ›
Market Segmentation of Louis Vuitton
Louis Vuitton divides their customer base into demographic groups based on age, gender, and disposable income. Louis Vuitton specifically targets women aged 18 to 54 with high yearly salaries of $75,000 or more, indicating considerable discretionary money.
Value-Based Pricing
As a luxury brand, Louis Vuitton pursues a value-based pricing strategy. It prices its items based on the value they offer rather than the amount of material and labor cost incurred in manufacturing them.
Demographic, psychographic, behavioral and geographic segmentation are considered the four main types of market segmentation, but there are also many other strategies you can use, including numerous variations on the four main types.
How does Gucci use market segmentation? ›Gucci Market Segmentation and Marketing Strategy
According to Gucci, the people who love the brand have an affluent lifestyle and love to demonstrate their status with luxurious style pieces. Gucci doesn't consider making products for people in the middle class or lower, as it is a high-end brand.
1 Louis Vuitton – travel and exploration. Louis Vuitton, the most valuable luxury fashion brand, stands for the highest quality and luxury, as well as its French origins and heritage.
Who is Louis Vuitton's biggest competitor? ›We identified the competitors of Louis Vuitton to be Hermès International SA and Gucci. The reason for this selection is because according to the Top 100 Global Brands in 2010, both Hermès and Gucci along with Louis Vuitton was listed as the top 3 luxury fashion brands.
What type of market structure is Louis Vuitton? ›The industry structure is an oligopoly where a few large luxury groups dominate the market. The dominating firms are LVMH, Richemont and Kering.
What is Louis Vuitton competitive advantage? ›Authentic Louis Vuitton bags are handmade from experienced craftsmen who take pride in producing impeccable products from only the finest and highest quality materials. The brand is synonymous with luxury, exclusivity and high-quality which create high demand in the market for its products.
What makes Louis Vuitton different from brands? ›Every bag, wallet or belt made by Louis Vuitton is individually handmade with the utmost care. It doesn't just stop there, though – after sales services such as free cleaning and product care are what truly sets the brand apart from others in its field.
What are target segments in marketing? ›Target marketing segmentation is where you divide your potential customers into segments. You'll then focus on a few segments (or groups of people) that align most with your product or services. Doing so helps you tap into their needs and desires to attract new sales and increase longevity.
How do you identify market segments and targets? ›
Market Segmentation
Identifying the market according to what they need and want. Analyse their usage pattern, likes and dislikes, lifestyle, and demographic. Note the growth potential of your market as well as your competition and the potential risk they may represent to your company.
Gucci's strategy to be the hottest brand is to promote inclusivity: appealing to everyone, rather than a specific gender. To that end, the Italian luxury house offers its customers more ready-to-wear to best capitalize on fashion trends.
Which brands use market segmentation? ›- Volkswagen. The Volkswagen group is an excellent example of how market segmentation allows a brand to appeal to very different groups of people. ...
- Coca-Cola. When it comes to understanding a broad customer base, few brands are as effective as Coca-Cola. ...
- Kellogg's.
Product Positioning Map
Gucci has built a reputation on producing high quality leather goods, made for longevity. This may help capture those who are not necessarily seeking goods because of the brand itself but because they will last. This in turn may help justify the high price to some of the more casual consumers.
The Louis Vuitton logo, commonly referred to as LV monogram, is one of the most famous and easily recognized fashion logos ever created. It was first designed by Louis' son, Georges Vuitton, who created the symbol by using his father's initials on the canvas.
What is Louis Vuitton brand personality? ›Elegant, subtle, comfort and classy are the personality traits that define this brand. It also cultivates within an individual an entrepreneurial spirit while leaving behind a hint of traditionalism. If you like a beautiful blend of heritage with modern innovativeness, Louis Vuitton is the brand for you.
What is a positioning statement? ›A positioning statement is an expression of how a given product, service or brand fills a particular consumer need in a way that its competitors don't. Positioning is the process of identifying an appropriate market niche for a product (or service or brand) and getting it established in that area.
What is Louis Vuitton's unique selling point? ›2. Perpetuating the image of "Ultimate Handmade Quality" It's not only the diverse assortment that made Louis Vuitton what it is today. Every fashionista will tell you that the ultimate handmade quality of its goods is what makes LV so unique.
What is LV competition? ›Gucci: Gucci is another well known name in the world of luxury fashion and a leading competitor of Louis Vuitton. The brand is known for its modern and innovative approach to fashion. It has been named after its founder Guccio Gucci, who founded the brand in 1921.
How does Louis Vuitton treat their customers? ›Louis Vuitton pays special attention to the quality of the material, the designs and make of the products. Thus, the cost price of the products eventually goes very high. Since the target customers of the brand are elite and upper middle class customers, Louis Vuitton uses premium pricing policy to price its products.
What type of organizational structure does LVMH have? ›
Decentralized organization
Our structure and operating principles ensure that our Maisons are both autonomous and responsive.
Having a niche market and targeted for upper social class, LVMH group has fierce and varies competition with their competitors in the same industry. As they operate in oligopoly industry structure, they have few big competitors, mainly the Kering Group, Richemont and Hermes.
Why LVMH has been able to develop a successful position in the luxury market? ›In conclusion, LVMH's success can be attributed to strategic acquisitions combined with the constant nurturing of its brands via autonomous creativity.
How does LVMH market? ›Exclusivity is another factor of LVMH's marketing strategy. When consumers realize a certain series, product, or collection is limited, they hurry to buy those items while available. This is a psychological phenomenon called FOMO (fear of missing out), which makes people act fast to not miss out on a good deal.
What is Louis Vuitton future plans? ›Luxury fashion label Louis Vuitton is moving full steam ahead toward a sustainable fashion future, even if its clients are dragging their heels. By 2025, Louis Vuitton says it will reach 100 percent on its sustainability goals.
What made Louis Vuitton successful? ›It was in 1854 he started his own business in Paris. Vuitton's use of canvas fabric instead of leather and other materials made him more famous. Because of its durability and waterproof quality, he quickly gained fame. Another thing Louis Vuitton was notable for was making the flat surface upper cover of trunks.
What are the challenges of Louis Vuitton? ›8.2WEAKNESSESThe brand is available only in its exclusive stores making it difficult for peopleall around the world. Fake imitations affect brand and sales. The productioncapabilities are limited. 8.3OPPORTUNITIESThe company needs to adopt the current fashion trends to stay in business.
What style is Louis Vuitton known for? ›Famed for being one of the most recognised luxury brands in the world, Louis Vuitton is synonymous with high-end leather goods, legendary steamer trunks, iconic monogram handbags, sublime watches and jewellery and cutting edge fashion.
Why segmentation targeting and positioning is important in marketing? ›The segmentation-targeting-positioning process is so effective because it breaks down broader markets into smaller parts, making it easier to develop specific approaches for reaching and engaging potential customers instead of using a generic marketing strategy that would not be as appealing, or as effective.
What is the difference between segmentation targeting and positioning? ›Positioning is the last stage in the Segmentation Targeting Positioning Cycle. Once the organization decides on its target market, it strives hard to create an image of its product in the minds of the consumers. The marketers create a first impression of the product in the minds of consumers through positioning.
What is targeting in marketing with example? ›
A target customer is an individual that's most likely to buy your product. And it's a subset of the broader target market. For example, if your target market is female athletes between the ages of 13 to 25, a target customer could be female athletes in the specific age range of 13 to 16.
What are the 3 target market strategies? ›The three strategies for selecting target markets are pursuing entire markets with one marketing mix, concentrating on one segment, or pursuing multiple market segments with multiple marketing mixes.
What is market segmentation with example? ›Common characteristics of a market segment include interests, lifestyle, age, gender, etc. Common examples of market segmentation include geographic, demographic, psychographic, and behavioral.
What is the best market segmentation? ›- Identifiable (or differentiable). ...
- Accessible. ...
- Substantial: large enough to allow companies to make profits;
- Measurable: companies must be able to understand their market share and positioning as well as the segment size and purchasing power.
- The company's resources. If resources are limited, a concentrated market targeting strategy might make more sense.
- The degree of product variability. ...
- The product life cycle. ...
- Market variability. ...
- Competitors' marketing strategies.
For example, a larger market segment is more attractive than a small one, basically because a larger market segment offers more potential customers and more potential conversions for a company. A marketing strategy doesn't have to be expensively tailored and effective in this case, which is better for the company.
What is the market segmentation? ›Market segmentation is a process companies use to break their potential customers into different sections. This allows the company to allocate the appropriate resource to each individual segment which allows for more accurate targeting across a variety of marketing campaigns.
What is psychographic segmentation? ›What is psychographic segmentation? Psychographic segmentation breaks down your customer groups into segments that influence buying behaviors, such as: beliefs, values, lifestyle, social status, opinions and activities.
What is Behavioristic segmentation? ›What is behavioral segmentation? Behavioral segmentation refers to a process in marketing which divides customers into segments depending on their behavior patterns when interacting with a particular business or website.
What are some of the sample variables under demographic segmentation? ›The five main demographic segments are age, gender, occupation, cultural background, and family status.
How do you identify market segments and targets? ›
Market Segmentation
Identifying the market according to what they need and want. Analyse their usage pattern, likes and dislikes, lifestyle, and demographic. Note the growth potential of your market as well as your competition and the potential risk they may represent to your company.
A target customer is an individual that's most likely to buy your product. And it's a subset of the broader target market. For example, if your target market is female athletes between the ages of 13 to 25, a target customer could be female athletes in the specific age range of 13 to 16.
What brands use psychographic segmentation? ›Top brands like Apple, utilize psychographic segmentation to create a brand personality that fits into the perception of their users. With psychographic data, Apple can communicate luxury, minimalism, and class to its target audience and also create marketing strategies for the different psychographic segments.
What is behavioral segmentation with example? ›Some of the most common nuances of behavioral segmentation boil down to when users become customers (acquisition), how they use the app (user journey), how frequently they use the product (engagement), and how long they continue to use the product (retention).
What are the 3 psychographic market segmentation? ›There are five psychographic segmentation variables on the basis of which homogeneous segments can be prepared for proper research – Personality, Lifestyle, Social Status, AIO (Activities, Interests, Opinions), and Attitudes.
What is geographic segmentation example? ›An example of geographic segmentation is an ice cream company segmenting a country by how hot different regions are and targeting those specific areas that are hottest and therefore more likely to buy ice cream.
What are psychographics examples? ›- Personalities. Personality describes the collection of traits that someone consistently exhibits over time, as commonly assessed through a 5-Factor Model. ...
- Lifestyles. ...
- Interests. ...
- Opinions, attitudes, and beliefs. ...
- Values.
Q: What is the difference between behavioral segmentation and psychographic segmentation? A: Behavioral segmentation groups people based on how they act, but psychographic segmentation groups them based on how they think or feel.
What products use demographic segmentation? ›Example of demographic segmentation based on age:
Companies that sell soft drinks, like Coca-cola, often target young adults between the age of 15 to 25 by depicting young men or women in their marketing campaigns.
Demographic segmentation allows you to get more specific with your marketing strategies. It helps clarify your vision, have more direction with future advertising plans, and optimize your resources, time, and budget. If 85% of your clients range from 20-35 years old, this is the segment you're going to target.
Which marketing strategy involves targeting a single segment with a unique strategy? ›
Concentrated marketing (or niche marketing)
This strategy targets only one of a few very specific segments of the target market.