Louis Vuitton in Japan Wac
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Louis Vuitton in Japan WAC
To analyze the reasons behind LVJs success in Japan, we must study both the companys rule in this successful venture, and the countrys culture as a receiving consumer market. As illustrated in the Louis Vuitton In Japan case study, the luxury brand holds a strong product catalog with a great depth in line and quality. Its continued discipline in quality and price control across the globe helped the brand in marketing its product position in its target markets collective conscious. This propelled the brand to succeed as a luxury option for the high-end shopper. Furthermore, to be more specific to LVJs success story, the Japanese culture played a crucial part in this business endeavor. The Japanese consumer mindset is greatly influenced by luxury goods, and this stems from the Japanese culture and its affection towards valuable items owned to “show off”. As a result, the combination of a great execution of a luxury brand with a culture that seeks such products is a definite formula for success. It may not be lasting success, but definitely a boom that would eventually redefine the LV brand.
When the global financial crisis hit in 2008, every consumer market was affected, and eventually all markets have fallen as a result. LVJ was just another business that got hit by this economic calamity. However, every misfortune to some is fortune to others, and hence, this could be used to harness new markets as much as it could destroy old ones. The follow Exhibit A demonstrates the challenge and opportunity that rose from this situation for LVJ:
Exhibit A
Challenge
Opportunity
Difficulties in selling luxury goods that resulted from associated high prices. Since the global economic crisis hit numerous consumers at an individual level, the decision to purchase expensive items became more difficult. The average consumer became much more fiscally conservative, resulting in a challenge to LVJ to market and convince their customers to purchase their highly priced luxury goods.
Opportunities came to LVJ to push low priced items. This increases the sales of small luxury goods, and creates a new market that values low production cost items at a high selling price (e.g. wallets and key chains). Since the consumer will always have a human nature that pushes to be distinguished through the purchase of luxury goods, allowing them to satisfy that need without being fiscally irresponsible is a strong selling point in these hard times.
For LVJ to grow and avoid saturation and maturity it needs to create a new path for development and evolution. One of the great options that were executed lucratively is the localization of luxury designs (e.g. Murakami and Aoki LV designs and products). This growth option was created to target the specific market of Japan, and it created a new approach to luxury: you can grow by introducing a locally identifiable and unique design using your already existing strong brand. CEO Fujii succeeded tremendously in this approach to uniqueness and special marketing. Another option to apply is the introduction to online shopping. This does not only mean the creation of an online shop where customers can buy LV products. No. This means to both push and pull LVJs customers to use that new selling portal (Exhibit B). The new world of mobile technology and instant shopping is dawning, and those who do not adopt it and innovate through it will lag and lose market share.
Exhibit B
Done by offering this new online shopping service to the customer base that thought they did not need it, and in return promoting them to use