International Strategic Management Of Lvmh Marketing Essay

The LVMH article describes the management aspects of a multi brand firm. LVMH is globally known as the world leading luxury goods companies. LVMH was established by the merger of two fashion houses, called: Louis Vuitton and Moet -Hennessy. LVMH produces and sells wines and spirits, fashion and leather goods, perfumes and cosmetics, watches and jewellery and selective retailing. However, the majority of sales originates from the style and leather goods division. The luxury group grew due to key acquisitions and the development and innovation of new products. The near future focus of LVMH is likely the growth into new markets and regions, where China, Russia and Eastern Europe countries can be viewed as. But how is undoubtedly an enormous company organized? Every division functions has its general manager and a management team, besides these divisions also controls and manage sales abroad. The five product sets of LMVH are decentralized into two subsidiaries: production and distribution subsidiaries. And also the organizational set-ups are organized regionally. The blissful luxury market is continually changing, nowadays there's a wide range for luxury products because the middle-class market purchase luxury products as well. Besides the luxury sector is related toward financial conditions. Additionally, the introduction of growing by acquisitions became an important technique for many organizations in the blissful luxury sector. In many of LVMH 's acquisitions it had maintained the creative talent as independent pool and certainly minus the producing of synergies between product lines or brands. For LVMH quality in production and product development is essential for their success strategy. Moreover, integration, training and top management seminars are designed in LVMH to aid business strategies.

What are the key strategic issues of this case (e. g. go into questions like what is this is of globalization in the blissful luxury industry; what's the meaning of a multi-brand strategy; why so many brands in one conglomerate company)?

Formerly, medium sized firms dominated the marketplace. However currently there are simply a few big players in the blissful luxury market that grew due to acquisitions. In the luxury industry globalization means the introduction of conglomerates. The main strategic issue in the LVMH case is the development and change in the blissful luxury market in relating to the globalization. Additionally, those conglomerates do follow a multi-brand strategy, which may be described as producing and selling of several competing products by the same company under different unrelated brands. The goal of a multi-brand strategy is to permit organizations to grow without overexploiting a particular brand and killing exclusivity. Firms seek to stretch their brands to attract new customers. Among the benefits would be that the companies become stronger and also have to cope with less competitors. Besides, organizations dominate the market through padding all quality and price spaces. Nowadays, the range of products in these companies had an enormous increase due to globalization.

LVMH operates globally and in addition to the LVMH has many offices in countries worldwide. Besides, the firm operates in several segments and will be offering a variety of different brands. However the international strategy differs per product group. The main strategy in the firm is a variety of multinational and global. In some product groups (like wine and spirits) LVMH has to be aware of local responsiveness, local regulations and norms. The firm has to adjust to the surroundings. On the other hand, product groups like, fashion and leather goods, are usually more in need of integration rather than local responsiveness, because the global dependence on the sort of fashion and leather goods is rather equal.

The firm LVMH operates in five different sectors of the market. They provide products in: wine and spirits, fashion and leather goods, perfumes and cosmetics, watches and jewellery and selective retailing. Each product group is individual. You can find little influence of the headquarter in each product group. The headquarter basically gives authority to the business divisions. This has the benefit that each business unit is flexible to adjust their structure to what suits their business unit and environment the best. However the organizational values are shared through the entire company. Summarized, considering chapter 3 of the textbook Laserre, it is clear that LVMH uses a type of multi business global product division model.

The employees have freedom so long as they meet their targets. In addition to this, Bernard Arnault described innovation as a driver for growth and profitability in the luxury industry. For LVMH quality in production and product development is vital for their success strategy. The firm pursues a strategy of soft recruiting, meaning that no real hierarchies exists. That is leading to that innovation is used in a fantastic way. Additionally the firm offers training programmes, face to face training to motivate and to be able of the introduction of the employees

Also We Can Offer!

Other services that we offer

If you don’t see the necessary subject, paper type, or topic in our list of available services and examples, don’t worry! We have a number of other academic disciplines to suit the needs of anyone who visits this website looking for help.

How to ...

We made your life easier with putting together a big number of articles and guidelines on how to plan and write different types of assignments (Essay, Research Paper, Dissertation etc)