In this blog, we will discuss about the SWOT Analysis of one of the most luxurious brands all over the world – Louis Vuitton. Everyone knows this brand name but the products of this company are not easily affordable and could be seen only in high-class society.

So, what makes this product such a hit amongst people all across the world? Let’s find out by going into the SWOT Analysis of Louis Vuitton.

About Louis Vuitton:

Louis Vuitton Malletier, aka Louis Vuitton, is a world-class luxury goods Brand. It was founded in the year 1854 by Louis Vuitton in Paris, France. Louis Vuitton is one of the most profitable brands in the world with total revenue of €14 billion (2020). Its product mix comprises leather goods, handbags, trunks, shoes, watches, accessories, and jewellery.

So, without any further ado, let’s dive into the SWOT Analysis of Louis Vuitton:

Being the world’s most valuable luxury brand, SWOT analysis has always been a key factor in giving critical understanding to compelling operations that lead to success.

SWOT Analysis of Louis Vuitton

(Source: Louis Vuitton)

Being the world’s most valuable luxury brand, SWOT analysis has always been a key factor in giving critical understanding to compelling operations that lead to success.

Thus, let’s start by discussing the strengths of Louis Vuitton:

Louis Vuitton’s Strengths:

Strengths are Aspects of what each business does best in its range of operations which can give, giving its competitors.

Louis Vuitton has unbeatable brand recall and a global presence

• It has an extremely huge level of Customer Loyalty

• Louis Vuitton is recognized very easily by everyone, The reason being its logo and monogram canvas on most of its products

• It also makes customized  products for its few Elite Customers

• The fantastic marketing using celebrities from the sports and film industry has been a plus point
• Louis Vuitton effectively collaborates with top designers worldwide
• It has exclusive availability in most of the large shopping hubs and multi-retail brands with 450+ stores and more than 50 countries worldwide
• Louis Vuitton is one of the oldest fashion brands with more than 150 years of establishment
• In the luxury, segment customers are always hyped about the quality of products that they use and are willing to pay a premium for it. No doubt, one of the biggest strengths of Louis Vuitton is its strong association with quality

Louis Vuitton’s Weaknesses:

These are the key areas where the business or the company should make enhancements

Intense competition results in low market shares

• The focus on exclusivity makes Louis Vuitton patent or copyright most of their designs and they rely on centralized decision making and this as an outcome pushes down the morale

• Louis Vuitton is French in style and design and it lacks sensitivity to trends in foreign countries

• Japan is one of Louis Vuitton’s biggest markets with more than 85 % per cent of Japanese women-owned Louis Vuitton products. This has reduced the ability of the company to work in other markets

• Louis Vuitton is a luxury brand and even a basic offering from the company costs about 1500 USD. This makes it impossible for the masses to purchase a Louis Vuitton bag or suitcase and as a repercussion, the company targets a niche market

• Fake emulations hurt sales and affect brand reputation as a reaction

• Weak online presence and online sales
• Louis Vuitton has quite limited channels of distribution. They make sales only through stores

Louis Vuitton’s Opportunities:

Opportunities refer to those avenues in the business environment on which it can capitalize to increase its returns.

• Revamping the brand image trying to attract more Millenials and Gen Z

• Strategic collaborations with certain other companies having the same customer segment

• Potential in Asia by and large, especially in China and  India

• Development of new products and services inducing Louis Vuitton’s competitive advantage

• Tie-ups with top lifestyle events, hotel chains, and fashion houses can boost business

• It is estimated that the global market for luxury goods is around 42 billion dollars, having a growth rate of 4 per cent per annum. This is surely a huge opportunity for luxury merchandise companies like Louis Vuitton.

• Due to the significant rise in per capita income in most countries across the world, there is an indication of a sharp increase in disposable income as well. This can be seen as one of the reasons for the surge in demand for non-essential items and luxury goods.

Louis Vuitton’s Threats:

Threats are those factors in the environment that can be detrimental to the growth of the business. Some of the threats include:

• Global recession or financial crisis

• Intensification in the popularity of substitute fashion products 

• Increasing competition from emerging countries can result in a decline in sales

• Counterfeit cases all around the world adversely affect Louis Vuitton along with diluted market shares and a negative image

• Government policies on international trade can become the reason for slowdown operations

• The prime forte of Louis Vuitton is their ability to create exclusive merchandise so it also means that they would need to customize for individual cultures. Their team which mostly consists of European designers will find managing multinational customization a huge challenge

Conclusion

With the above SWOT analysis of Louis Vuitton, it can be concluded that this brand is doing well enough in the market with its long-established strategies but there are certain threats that can hamper the growth of the company in this ever-changing world like restricted target market. There are several opportunities taking advantage of which Louis Vuitton can create for itself an established brand in the long-term too. So, this amazing brand is already on the top but to sustain their position in the market they need to take their SWOT analysis seriously. 

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