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In this report, we have chosen the global brand of Louis Vuitton for evaluation. First, the customer perceived values of its customers have been discussed. Then their value proposition has been assessed and Gucci, its rival has been selected for comparison and contrast of the value propositions.
Louis Vuitton uses value-based pricing in its marketing mix for its products. Since customers perceive the company's products as high-value products, the customers are willing to pay the amount. Louis Vuitton pays special attention to the quality of the material, the designs and the make of the products. They deal with handbags, leather goods, clothes, shoes, accessories, trunks and other types of bags etc. Their brand value is highly popular and globally acknowledged. Their brand value is worth $32.3 billion (Ngo et al, 2020).
Gucci, the competitor is also a brand that manufactures clothes, bags, shoes and accessories. They have equal global recognition and a wide market. Their brand value is worth $18.2 billion (Micco, 2021). This brand is recognized for the stylish yet edgy commodities and the market for this brand is less expensive than Louis Vuitton. However, they also focus on exclusivity, brand value and market proposition.
The comparison and contrast will give us important insights into the operations and the working environment of the companies. The marketing facilities and advertisements and other branding programmes will also be scrutinized and assessed.
Whether the customers are the final consumer of the prepared and marketed commodities or a retailing trade network or entrepreneur who buys segments of the entire commodity, they seek the satisfaction of a requirement through that certain commodity. They use various parameters for deciding the amount of money they are willing to invest for the satisfaction of that requirement. The preferable way is to pay as low as possible. In the case of Louis Vuitton, the price demanded by the company is quite high. So they use other methods to create an enhanced customer perceived value.
The potential customers and customers of the brand are preferably wealthy women between the ages of 18 years and 54 years. They must have a wealthy background, disposable income, a thorough knowledge of international fashions, global trends, high maintenance lifestyle and the necessary mindset for spending on branded products. They also need to have a wealthy social circle or professional environment where the products they use will be recognized and they would receive acclamation for investment in luxury brands and commodities with little utility (Wiradharma, 2021).
The potential markets involve the urban areas of the developed and developing countries with residents from high-income groups, metropolitan cities, business hubs and areas with clusters of fashion and entertainment industries and professionals.
These are the necessary conditions to be fulfilled. Sometimes the customer is not aware of their existence. However, the marketing team has to identify and tap them to capture and retain the attention of the customer and make them believe in the value proposition of the company. Hence the customers purchase a product only after they believe that all these have been accomplished. For the Louis Vuitton clientele, these include:
These are thought of as desirables and they are not always at the forefront of priority. Rather the customer, when given a large number of options to choose from, selects a product and service based on these preferences. For purchasers of Louis Vuitton, the wants are:
These are the factors that stimulate their emotional response to a commodity. The fears involve their perception of limitations, inferiorities and drawbacks. In the case of the women who might purchase Louis Vuitton products, the fears are mentioned here (Hemantha, 2020).
The wants, needs and fears of the customers communicate to the marketing analysts and strategy planners from the company about their possible sources of advertising campaigns, methods of lead generation and so on. Since the customer perceived values mostly deal with the emotional triggers stimulated by the display of luxury and the response to it, the company has to tap on their emotional response of them (Lopusneac, 2020).
To account for the customer values and their rate of satisfaction a figure is given below.
Although Louis Vuitton is a highly profitable international brand, they do not render retailing experiences which are specifically designed for satisfying a customer—unless the customer is a renowned personality or has a wealthy appearance, they are usually ignored by the staff involved in sales and servicing. This ambiguous response and lack of recognition are useful for triggering our Psychological Immune System for rationalization of the sufferings in exchange for a return of equal or greater valuation—exclusivity—highly significant for Louis Vuitton’s potential aims of leads and prospective customers and for creating, establishing and asserting their brand values (Song et al., 2021). Therefore, Louis Vuitton focuses on the delivery of an efficient and internationally acclaimed experience from in-house purchase, in exchange for a bit of financial suffering.
Louis Vuitton does not offer any direct assurance of the quality of the product, versatility, utility or durability. Instead, they focus on experience and exclusive treatment. They imply that when a customer is availing their service they are availing the exclusive service of a globally renowned brand. The purchase itself and the use of the product are marketed as a novel experience, which can only be purchased when a customer is willing to spend more than the market cost. The brand value of the company here comes into play and it enhances the customer's perceived value by adding to the market price of the commodity (Elia, 2021).
When marketers discuss the issue of raising the perceived benefit, they address it raising the "value-added." Identification and increase of the value-added attributes of a commodity form one of the significant strategies in marketing of Louis Vuitton, since they focus on brand value to differentiate the experience and product from other offers (Smith, 2021).
Thus we can see that even though customer responses vary because of the experience, the value proposition of Louis Vuitton focuses on exclusive experience and international recognition of wealth and status because brand value provides the main source of satisfying customer perceived value. The figure below sums up the findings and results.
While Louis Vuitton and Gucci both are rival brands with global market base, high price range and different luxury commodities, the value propositions of the two companies differ in the following way:
The value propositions of both brands have more similarities than differences. However, the marketing strategy and potential customer base have a slightly different structure. The customers with a high-income range and proclivities for high fashion are limited in the world. So both of them have to focus on these few people and capture their attention. That is why instead of focusing on commodity value they focus on the brand value and the experience provided by them (Zhong, 2021).
Thus we can see that the utilization of brand value can be used to enhance profit margin and attract high-income range customers. The evaluation, comparison and contrast of the propositions concerning brand values of the two companies give us an elaborate idea of the marketing strategy. The customer perceived value and the value proposition for branding Louis Vuitton have also been taken into account before that for providing a detailed assessment on the functioning of the company. The recommendations for the company shall include the following
The comparison has shown the specific aspects for improvement in the value and branding of the company and the improvement of the quality of the product and the services rendered to the customers and clients on the basis of the consumption pattern, internal trends and global patterns of fashion.
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