Chapter 8. Segmenting and Targeting Markets

Louis Vuitton started out with providing luxury products exclusively for the very wealthy people of the society. Although times have changed and the market for luxury products has increased enormously, Louis Vuitton still targets the wealthy. The creativity, exclusivity,craftsmanship, precision, high quality, innovation and premium pricing are product attributes that not only give the consumer the satisfaction of owning expensive items, but the extra-added psychological benefits like prestige and a sense of high status that reminds them and others that they belong to an exclusive group of a selected few.

Geographic Segmentation.

Louis Vuitton's marketing strategy has been exceptional in expanding in countries with high density, such as China, India, Russia and lately Brasil. When Louis Vuitton opened its first store in China, people asked: "Why have you come here? We don't understand luxury" The answer of Yves Carcelle - CEO and Chairman of Louis Vuitton said: "No, you are sophisticated and one day soon you'll be the biggest superpower." I posted this phrase in an older post, and since then it stayed with me. It was 18 years ago ca. when Louis Vuitton opened its first store in China and today China is close to being the biggest superpower. The Chinese were right, they didn't understand luxury, but Louis Vuitton was there to show them what luxury meant - The art of traveling, which means the Fine art of living. 

Demographic Segmentation.

Louis Vuitton targets both genders, men and women, from 16 to 80 years of age obviously wealthy.  

Business men and women with high income and disposable income.

Psychographic Segmentation. 

Louis Vuitton uses psychographic segmentation such as lifestyle and motives to further identify its target market. In countries such as China and Brazil people need to show their social status, and wealth. Louis Vuitton appeals to these customers with status related motives.

Trendsetters and fashionistas are the next segment. For instance, Louis Vuitton collaborated with Kanye West to target the Hip Hop personalities.   

The lifestyle segmentation is Louis Vuitton's ultimate strategy. The slogan "The Art of Traveling" set new standards for a luxury lifestyle. Since traveling is an art, then owing a Louis Vuitton product makes you part of that art. 

Usage - Rate Segmentation
Louis Vuitton segments consumers by usage; specifically targeting heavy users. Buyer information is collected at the point of sale and stored in a database. Heavy users are sent seasonal catalogs as well as invitations to purchase exclusive product collections to encourage repeated sales and brand loyalty.

Positioning 

The long history, craftsmanship, exceptional quality, creativity, unstoppable innovation, association with art etc., position Louis Vuitton as the Master of Luxury in consumers' mind. 

The 2013 Louis Vuitton Cup will mark the 30th anniversary of this esteemed event; a yachting competition sponsored by Louis Vuitton, in which the winner advances to the America’s Cup. This sponsored event caters to the extremely wealthy, who are traditionally loyal Louis Vuitton customers. The event reinforces Louis Vuitton’s prestigious image and creates a sense of exclusivity that those who participate in the event seek.

Louis Vuitton also holds the Louis Vuitton Classics Annual Automobile Race in Paris. It was 

launched in 1989 and has taken place every year since then. Expensive cars have an association with classic values and a conservative lifestyle which also is an approach that Louis Vuitton aims to have. The company and its founders have a connection with cars ever since the foundation. A hundred years ago George Vuitton, son of Louis Vuitton, designed the first car trunk. In the following years he continued designing interior car details and added finishing touches to classics like Bentley, Rolls Royce, Alfa Romeo and Hotchkiss.