Strengths in the SWOT analysis of Louis Vuitton
:
Strengths are defined as what each business does best in
its gamut of operations which can give it an upper hand over its
competitors. The following are the strengths of Louis
Vuitton:
- Strong association to quality: In the luxury segment
customers are always fussy about the quality of products that they
use and are willing to pay a premium for it. Louis Vuitton products
have always been the benchmark in quality and design for hand
luggage. The strong association with quality is LV’s biggest
strength.
- Brand recognition: The Louis Vuitton monogram is high
on recognition and thus people prefer to carry LV monogrammed
luggage since it is an association with status and class in
society.
- Top Celebrity endorsements: Louis Vuitton has always
been powered by the biggest names in show business who have
endorsed the brand and carried it in public appearances. Some of
their top endorsers include Scarlett Johansson, Uma Thurman,
Angelina Jolie and Muhammad Ali.
- Wide network: Louis Vuitton has around 1, 21,289
employees globally making it one of the world’s top employers in
companies dealing with luxury goods. The company sells its products
through their own chain of stores, high-end retail chains, and
their website. The brand is sold in more than 50 countries across
460 outlets.
- Exclusive Merchandise: Louis Vuitton is known for their
personalized luggage options which are monogrammed to indicate
their label. Their exclusive brands will guarantee that your
luggage stands apart from the crowd and is not carried by anyone
else.
- Top Designers: The design team in Louis Vuitton
comprises of top designers of the world. Some of the names include
Helmut Lang, Azzedine Alaïa, Sybilla, Manolo Blahnik, Vivienne
Westwood, Isaac Mizrahi, Stephen Sprouse, and Romeo
Gigli
Louis Vuitton is a luxury fashion brand founded by
designer Louis Vuitton in the year 1854. The brand which
specialized in monogrammed and personalized luggage and handbags
today has a strong presence in categories like luxury briefcases
and suitcases, leather merchandise like ready-to-wear, shoes,
watches, jewelry, accessories, sunglasses and books.
The Louis Vuitton fashion house which is a preferred
choice of celebrities and public personalities of the world
registered a revenue of 10 billion USD in the financial year 2016.
The company sells its products through their own chain of stores,
high-end retail chains, and their website. The company was voted as
the world’s most valuable luxury brand for six consecutive years
from 2006 -2012 by Forbes but its value started declining from the
year 2013.
Strengths in the SWOT analysis of Louis Vuitton
:
Strengths are defined as what each business does best in
its gamut of operations which can give it an upper hand over its
competitors. The following are the strengths of Louis
Vuitton:
- Strong association to quality: In the luxury segment
customers are always fussy about the quality of products that they
use and are willing to pay a premium for it. Louis Vuitton products
have always been the benchmark in quality and design for hand
luggage. The strong association with quality is LV’s biggest
strength.
- Brand recognition: The Louis Vuitton monogram is high
on recognition and thus people prefer to carry LV monogrammed
luggage since it is an association with status and class in
society.
- Top Celebrity endorsements: Louis Vuitton has always
been powered by the biggest names in show business who have
endorsed the brand and carried it in public appearances. Some of
their top endorsers include Scarlett Johansson, Uma Thurman,
Angelina Jolie and Muhammad Ali.
- Wide network: Louis Vuitton has around 1, 21,289
employees globally making it one of the world’s top employers in
companies dealing with luxury goods. The company sells its products
through their own chain of stores, high-end retail chains, and
their website. The brand is sold in more than 50 countries across
460 outlets.
- Exclusive Merchandise: Louis Vuitton is known for their
personalized luggage options which are monogrammed to indicate
their label. Their exclusive brands will guarantee that your
luggage stands apart from the crowd and is not carried by anyone
else.
- Top Designers: The design team in Louis Vuitton
comprises of top designers of the world. Some of the names include
Helmut Lang, Azzedine Alaïa, Sybilla, Manolo Blahnik, Vivienne
Westwood, Isaac Mizrahi, Stephen Sprouse, and Romeo
Gigli
Weaknesses in the SWOT analysis of Louis Vuitton
:
Weaknesses are used to refer to areas where the business
or the brand needs improvement. Some of the key weaknesses of Louis
Vuitton are:
- Excessive centralization: Louis Vuitton is known to be
a tough employer and their focus on exclusivity makes them patent
or copyright most of their designs and they rely on centralized
decision making which brings down the morale.
- Lack of sensitivity to foreign cultures: Louis Vuitton
is French in styling and design and the brand is much closer
towards accepting other designs and is also not sensitive to trends
in foreign countries.
- Over-Reliance on Japanese Market: Japan is one of Louis
Vuitton biggest markets and more than 85 % percent of Japanese
women own an LV product. This has reduced the ability of the
company to look at other markets.
- Exorbitant Pricing: Louis Vuitton is a luxury brand and
a basic offering from the company costs about 1500 USD. This makes
it impossible for the masses to purchase an LV bag or suitcase and
thus the company targets a niche market.
Opportunities in the SWOT analysis of Louis Vuitton
:
Opportunities refer to those avenues in the environment
that surrounds the business on which it can capitalize to increase
its returns. Some of the opportunities include:
- Growing market potential: The global market for luxury
goods is estimated at around 42 billion dollars with a growth rate
of 4 percent per annum. This could be a huge opportunity for luxury
merchandise companies.
- Increase in the number of working women: The need for
status symbols is growing at the workplace as more women enter
there. This creates a significant opportunity for Louis Vuitton in
their prime segment which is formal luggage options.
- Rise in per capita income: Most countries across the
world have seen a significant increase in the per capita income
with the result that disposable income is indicating a sharp
increase as well. This is expected to create a surge in demand for
non-essential items and luxury goods
Threats in the SWOT analysis of Louis Vuitton
:
Threats are those factors in the environment which can
be detrimental to the growth of the business. Some of the threats
include:
- Counterfeiting: The biggest threat that luxury good
face today is that of counterfeit products in the market.The
presence of counterfeits not just gives the brand a negative image
but also dilutes the market share.
- Managing multinational customisation: The forte of
Louis Vuitton is their ability to create exclusive merchandise and
this means that they would also need to customise for individual
cultures. Their team which mostly comprises of European designer
will find this a huge challenge.