Question

2. Answer the following about the Louis Vuitton case What are the challenge's facing the leather-and-fashion a. to part a. b. Identify one option available to LV to face your answer What are the advantages of your answer to part b? c. d. What are the disadvantages of your answer to part b?

Answer 1

Answer A:-

Challenges of LV

                                                                  Economic crisis

            The economic crisis has presented the major problem in the LV operation in the global markets. The economic crisis has shifted the purchasing habit and consumptions among the consumers. The current shift manifestation has adverse effects on the consumers’ attitudes, and behavior and the situation decrease the confidence of buying luxury products. The weak and the steady appreciation of the Euro in all the global markets have affected the consumer purchasing power and diminish the demand for luxury products

The greater number of alternative product options in the markets and product saturation

            The markets are crowded with the high numbers and gradual increase of the new luxury and imported brand in the global markets that have posted a threat to the old players in the markets. The new luxury brands are priced relatively low that causes the movement along the demand curve of the LV products. According to the law of demand, entry of a new brand of products that has low price allocations has the impact of drawing away the demand for the old products in the markets. Thus, loyal customers tend to have different alternatives to choose from that than maintaining brand loyalty. LV has reached the peak it in its operation in the global markets; it has to readjust to the current trends in the markets, the quality of the products as well as the extent to which the products

                                    The global financial crisis and enhancing customer satisfaction

            The global financial crisis is created with the increasing number of competitors in the markets that have affected the consumer mindset and behavior. The higher proceed products offered by the LV are easily attacked by the competitors that reduce the demand for such products The consumers are more flexible in lifestyle, tastes, and preferences, and the changes in purchase behavior follow the trend. It is presumed and perceived that everything in the global markets will return to normal upon the market competition, and LV is focused on adopting the changes to deal with the financial crisis and high priced product. Additionally, meeting the demand and the expectation of the varied number of customers has proven to be a challenge in the global markets. With the changes in tastes and preferences, meeting the demands and the expectations of the customers has become a major problem. In the view of luxury, all the customers must be treated like the VIPs that is focused on developing political power.

Answer B

                                                                        Options available to LV

                                    Development of extensive research and products quality innovations

            LV will be compelled to invest in the extensive research that focuses on the customers in the diversified markets. The research should exploit the current marketing performance to gain customer information and link with other organizations functions to boost its performances in the global markets. Additionally, LV should carry out research that is focused on the marketing trends and developing the marketing principles that are outstanding for its success and gaining the markets share. Product saturation has presented a problem; therefore, the LV must create and extensions in its innovative ventures to develop a new brand and luxurious products. The company must integrate the special knowledge that is fundamental to create and sustain the competitive advantage. Production of innovative products needs a wide array of knowledge that will ensure that the existing and the new products meet customer satisfaction, taste, and preferences