Approach to the foreign markets: LVMH
- Understanding the business identity and culture
- The general policy of the company
- The culture
- The moto
- Strategic segmentation
- Competitive edge
- Key success factors
- Competencies that the company can gain to experience in segments
- The grouping
- Value chain
The clothing originally had a purely utilitarian function. From the thirteenth century, the first symptoms appear that have never stopped growing. Fashion as one understands it today was born in the nineteenth century. At the beginning of the twentieth century,
Haute couture has acquired its letters of nobility. Haute couture and ready-to-wear clothes have a worldwide turnover of about 20 billion Euros. It is a largely globalized as well as the other sector of the economy and it is characterized by the multiplicity of actors and strategies implemented. There are really rare people who have not heard of LVMH, the world leader in the luxury sector. Indeed, the media regularly broadcast the information relating to the Group: one day it had announced the establishment of a distribution network in a geographical area not yet exploited. The next day it had revealed the news of a new alliance with a luxury company (as recently acquired by Donna Karan or equity stake in Prada).
One should then ask, on what criteria is the decision of men to carry out such operations based? This then raises the question of how LVMH has established itself as a world leader in luxury goods. Initially this paper will introduce the LVMH group, it will then analyze its growth strategy to finally put an end to the problems encountered.
150 years ago Louis Vuitton opened a shop near the Opera in Paris. In autumn 2005, the famous leather goods store opened on the Champs Elysees, a store of 1800m square renovated and later expanded. Louis Vuitton has since built and bacame LVMH in 1987 and in 1989 the group was taken over by Bernard Arnault.
This 52 years old, son of an industrialist and a graduate of Polytechnic,has created over ten years the world leader in luxury, from the merger of two firms: Louis Vuitton, a company specializing in fashion accessories founded in 1834, and Moet Hennessy, a group of wineand spirits in 1971. Today the group is in the "most beautiful claw" fashion, the brands of wines and spirits the most famous, with a total of over 60 companies to its credit.
Ever since its inception in 1987, LVMH not only with its brand development policy but also through the expansion marks its distribution network nationally and internationally (worldwide nearly 1,700 stores) and is part of a strong dynamic growth.
The world leader in luxury, LVMH has close to 50 brands in its group. Thus, the group operates in five business areas namely: wine, spirits, fashion and leather goods, perfumes, cosmetics, watches, jewelry,with selective distribution, which represent many companies and brands.These sectors reported a turnover of 11.962 billion euros in 2004
LVMH group, world leader in the luxury industry has strong ambitions. Itis well positioned in its industry to address the future positively. To do so, the group attempts to reconcile three main objectives namely: Strengthening its global leadership of luxury brands;To continue the conquest of strong positions in its selective distribution and to develop value creation.
The group is also thinking of moving towards a long-term vision with the ambitious target of doubling its size in five years. For this group of individuals will lead strategies for internal and external growth.
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