Lvmh Swot Analysis

Impressions of the world wide operations of LVMH are high for the company. In order for a company to remain on top in the luxury good industry, specific strategies have to be implemented with success. Given their success rate, LVMH are implementing those types of strategies. Their ability to maintain their customer loyalty for such high priced items says a lot of the quality and customer service provided. LVMH’s ability to recognize new and emerging global markets, such as China and India, and turn profits means that the company can adapt to cultural needs of those consumers. LVMH is not afraid to close under-performing stores in order to cut costs and boost sales in their other stores. This strategy has many risks but with great rewards if executed properly. In LVMH’s case, they have succeeded in this process.

SWOT Analysis

Strengths:

• Customer loyalty

• Product demand

• Global market share

• Many lines of revenue

• High quality products and distribution practices

• Top company in respective industries

Weaknesses:

• Decline in DFS (duty-free shops)

• Underperforming stores

• Lack of name recognition for some products

• Competing products within company

Opportunities:

• New global markets (Asia, India)

• Stronger recognition of other brands besides Louis Vuitton

• Stronger global presence

• Greater placement of stores

• Acquiring new companies

• New distribution channels

Threats:

• Imitation goods

• Change in consumer needs/demands/taste

• Recessions

• Competitors

Does LVMH have a competitive advantage and/or competitive strategy? Absolutely it does which focuses on luxury goods and desire for their customers to own these goods out of envy. With all the brands under the LVMH umbrella, they are all considered luxury goods and have a significantly higher price tag when compared to other competitors within the same market. However, the name, quality, fashion, status, and other factors that indicate luxury are what LVMH depends on for sales. So this being their strategy leads to an advantage over the competition. There are some competitors that represent threats to the company but the market is seemingly large enough to accommodate.

Sephora, a beauty supply company, acquired by LVMH in 1997 has recently announced a new partner and process in its supply chain. Using