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1. What factors are driving changes in the industry, and what impact will these changes have on competitive intensity and industry profitability?

* Increasing globalization

* changing buyer demographics

* technological change

* Internet-related developments

* product and marketing innovation

* international expansion of selective distribution

2. Are the company's prices and costs competitive?

LV consistently pursued a luxury pricing strategy where there are high mark-ups and limited availability. All set of activities like bargaining, sale in value sets or odd prices in order to attract more customers are strictly prohibited in Louis Vuitton. The company does not believe in cutting cost or off shoring production to China or any other countries where the labor cost is cheaper.

3. Porter's view?

Based on Porter’s Generic Strategies, to achieve and maintain the competitive advantages, there are four generic competitive strategies can be chosen. LV, targets entire market and uses competency uniqueness, chooses differentiation strategy to outperform its competition. The primary point on this strategy lies in creating customer loyalty.

For the luxury brand, it is not just a manufacturer provides goods but also makes ‘intangible into tangible’. LV provides after sales service for maintenance its brand products. It can enhance the service quality and perceived as being unique.

Firm performance is the other important criteria that can differentiate LV and its competitors. There are placed an employees training to keep them to provide high quality service to each customer. It is necessary that control luxury brand quality through service and product.

Since LV only has few stores in worldwide, it eases to deliver a consistent service quality. Since LV only made its product in France and Spain, it can limit the risk on production process as well as to control quality. Those activities can develop a more trusting relationship with...