Business Analysis

Louis Vuitton Segmentation, Targeting, and Positioning

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When Louis Vuitton is mentioned in any context, the first thing that comes to mind is class. And class is what has traditionally separated this clothing brand from others. Louis Vuitton began operations with an exclusive class of customers in mind. This clothing line was exclusively reserved for the highly privileged members of society. 

Only wealthy, upper-class customers could afford to buy the brand at the time. However, while Louis Vuitton is still a high-priced clothing and accessories brand, they have been able to adjust its product offering to accommodate other social classes, particularly the upper-middle class. 

Louis Vuitton is known for producing high-quality premium products with exquisite craftsmanship. This brand offers unique, innovative, and fashionable items that give users the prestige of knowing that they own an artistically crafted product with a brand name that screams high status and class. This post highlights Louis Vuitton's segmentation, targeting, and positioning strategies as contained in their marketing plan.

Market Segmentation of Louis Vuitton

Louis Vuitton's market segmentation consists mainly of Geographic, Demographic, Psychographic segmentation, and Usage-Rate segmentation.

With Geographic segmentation, Louis Vuitton has been able to establish its brand in several countries around the world. They have expanded their reach to highly populated cities in countries such as; Brazil, India, and China. Louis Vuitton identifies the future potential of countries like India and China. 

Many observers questioned their opening of stores in these countries, especially since the majority of the population is in the lower bracket of the income scale and cannot necessarily afford luxury items. However, Louis Vuitton understands the importance of market penetration in an emerging economy. Even with a large population, India and China do have a small percentage of high-income earning populace. This small percentage in the context of the overall population of these countries is actually a huge number, more so than the number of existing and prospective customers that can be found in more developed countries of the world. 

By positioning themselves in these markets, Louis Vuitton can take full advantage at the right time. China is now a superpower, and many Chinese are now regarded as an upper class not just by their own reckoning but also by world standards. As the economy improves, people earn better incomes and have surplus cash to spend on luxury items which is where Louis Vuitton steps in.

The Demographic segmentation of Louis Vuitton considers the age and gender of its target audience. This brand targets both male and female customers. Also, Louis Vuitton targets customers between the ages of 16 and 80 years. These customers may come from affluent families and homes or maybe self-made millionaire entrepreneurs. They may also be employees of high-paying companies. Ultimately, the one thing that all existing and/or prospective customers of Louis Vuitton should have is high disposable funds.

Targeting of Louis Vuitton

Louis Vuitton's target market is also identified by applying Psychographic segmentation strategies. The motives behind customers owning luxury items are very important in determining the direction of the marketing mix. For example, people in Brazil, China, and India buy luxury items to show off their wealth, social class, and status. 

Therefore, these types of people are drawn to brands like Louis Vuitton as class and status are two keywords that define what the brand is all about. Another group of customers attracted to Louis Vuitton is fashionable, trendy, and stylish consumers. Celebrities tend to fall into this category of consumers. Louis Vuitton also relies on endorsements by huge personalities and trendsetters. Lifestyle is, therefore, another Psychographic segmentation that Louis Vuitton capitalizes on in boosting sales and revenue. 

One other segmentation strategy applied by Louis Vuitton is Usage-Rate segmentation. Typically, this brand pays a lot of attention to customers known to be heavy consumers of their products. Before prospective customers pay for Louis Vuitton products, they are often enticed to provide personal data. Armed with this information Louis Vuitton then creates a profile for each customer, which is stored in their customer database. 

Frequent buyers can then be motivated to buy even more items as the marketing team of Louis Vuitton follows up on these customers with attractive bonuses and freebies. For example, customers may be given exclusive discounts and promo offers. They may also be contacted by Louis Vuitton's customer support on special anniversaries like birthdays and wedding anniversaries. All this is done to encourage brand loyalty which leads to repeat sales.

Positioning of Louis Vuitton

Louis Vuitton's brand positioning is further enhanced by its participation in various public events. But not just any event, Louis Vuitton keeps up with its image as a brand for the wealthy by sponsoring luxurious events involving the upper echelon of society. One of such events is the Louis Vuitton Cup, which is a competitive yachting event that sees winners getting a free pass to America's Cup. 

Louis Vuitton also sponsors the Louis Vuitton Classics Annual Automobile Race, which was first started back in 1989 and has been staged yearly ever since. Yachts and luxury vehicles are two vices of the rich and famous. This is why Louis Vuitton is fully invested in these events. By sponsoring such events, they are able to position the brand in the minds and hearts of wealthy individuals who are loyal to the brand and the main consumers of their products.

It is interesting to know that George Vuitton, the son of Louis Vuitton, is widely credited as the person first to design a car trunk. This was done over a century ago and shows how long it has been since the brand has been associated with cars. George Vuitton has also designed the interior details of famous car brands, such as; Alfa Romeo, Rolls Royce, and Bentley. 

By actively sponsoring and participating in events for the wealthy, Louis Vuitton continues to generate interest, patronage, and brand loyalty.

Mind Map

Louis Vuitton Segmentation, Targeting, and Positioning
Louis Vuitton Segmentation, Targeting, and Positioning Mind Map

Key Takeaways

Louis Vuitton STP strategies are designed to keep this luxury brand on top of the bucket list of the high and mighty in society. Louis Vuitton applies Geographic, Demographic, Psychographic, and Usage-Rate segmentation. Louis Vuitton targets high-income customer groups with equally high disposable income to spare. 

They have expanded their business into highly populated countries like China, India, and Brazil to take advantage of any positive improvements in their economy, which would lead to a.large portion of the population having disposable income to spend. To continue receiving the wealthy's support, patronage, and loyalty, Louis Vuitton sponsors many luxurious events. Some of these events, like the Louis Vuitton Classics Annual Automobile Race, are held annually.

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Marketing Strategy of Louis Vuitton – Louis Vuitton Marketing Strategy

March 6, 2018, By Hitesh Bhasin


Louis Vuitton: Company Analysis


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