Luxury Brand Strategy

LUXURY

 BRAND

 STRATEGY

Business

 Strategy

  Presented

 By:

 K.

 Can

 IPEK

Risk&Financial

 Performance

 Figures

•  What

 is

 the

 Luxury

 Industry

 Business

 model?

  •  The

 ROE

 for

 the

 luxury

 industry

 (see

 tables

  bellow)

 is

 more

 or

 less

 25%

 which

 mean

 that

 is

 a

  highly

 profitable

 industry.

  •  The

 Dupont

 Model

 permits

 us

 to

 assess

 the

  Return

 On

 Equity

 in

 order

 to

 know

 the

 financial

  performance

 of

 the

 business.

  •  But

 what

 is

 the

 most

 important

 determinant/ leverage?

  •  This

 ROE

 is

 based

 on:

 DL

 x

 ROI

Risk&Financial

 Performance

 Figures

Risk&Financial

 Performance

 Figures

  (cont.)

•  Based

 on

 these

 figures:

• 

  The

 high

 ROE

 figures

 of

 three

 companies

 stand

 out:

 Tod’s,

 Hermes,

 LMVH

HERMES

•  •  •  •  •  •  -­‐Product

 Segment

  -­‐The

 brand

 focused

 its

 strategy

 on

 Leather

 goods

 plus

 saddler

 and

 Ready-­‐to-­‐wear

  -­‐The

 sales

 growth

 of

 leather

 goods

 and

 silk

 products

 help

 Hermes

 to

 resist

 during

 the

 crisis.

  -­‐Besides

 Leather,

 Ready-­‐to-­‐wear

 and

 Silk,

 others

 segments

 are

 negligible

  -­‐The

 problem

 of

 Hermès

 is

 its

 inability

 of

 producing

 customized

 products.

 That

 explains

 the

  acquisi_on

 of

 Soficuir

 (specialized

 in

 customiza_on)

  -­‐Besides

 its

 core

 business

 (leather

 goods),

 Hermes

 wants

 to

 develop

 ready-­‐to-­‐wear

 (Jean-­‐Paul

  Gaul_er...