International Strategic Management Of Lvmh Marketing Essay

International strategic Management Of Lvmh Marketing EssayThe LVMH article describes the management aspects of a multi grunge tighten. LVMH is globally known as the world leading lavishness goods companies. LVMH was found by the merger of two mien houses, called Louis Vuitton and Moet -Hennessy. LVMH produces and sells wines and spirits, fashion and welt goods, perfumes and cosmetics, watches and jewellery and selective retailing. However, the majority of sales comes from the fashion and leather goods division. The luxury host grew overdue to key acquisitions and the victimization and cornerstone of new wares. The future strain of LVMH is likely the growth into new marts and regions, where China, Russia and Eastern Europe countries can be considered. But how is such a huge company organise? every(prenominal) division functions has its own general manager and a management team, withal these divisions also controls and manage sales abroad. The five product groups of LM VH are decentralize into two subsidiaries production and distribution subsidiaries. Additionally the organizational set-ups are organized regionally. The luxury market is constantly changing, nowadays there is a huge range for luxury products since the middle-class market purchase luxury products as well. Besides the luxury sector is related toward economic conditions. Additionally , the development of growing by acquisitions became an important dodging for many firms in the luxury sector. In many of LVMH s acquisitions it had maintained the creative talent as independent pool and certainly without the generating of synergies between product lines or brands. For LVMH character in production and product development is essential for their success strategy. Moreover, integration, cooking and top management seminars are designed in LVMH to support seam strategies.What are the main strategic issues of this case (e.g. go into questions like what is the center of globalization in t he luxury industry what is the meaning of a multi-brand strategy why so many brands in one conglomerate company)?Formerly, intermediate sized firms dominated the market. However currently there are further a few big players in the luxury market that grew due to acquisitions. In the luxury industry globalization means the development of conglomerates. The nigh important strategic issue in the LVMH case is the development and depart in the luxury market in relating to the globalization. Additionally, those conglomerates do follow a multi-brand strategy, which can be described as producing and selling of two or more competing products by the same company under different unrelated brands. The goal of a multi-brand strategy is to allow organizations to grow without overexploiting a peculiar(prenominal) brand and killing exclusivity. Firms seek to stretch their brands to attract new customers. maven of the benefits is that the firms become stronger and have to deal with less competi tors. Besides , firms dominate the market through padding all quality and price spaces. Nowadays, the range of products in these firms had a massive increase due to globalization.LVMH operates globally and in accession to this LVMH has many offices in countries worldwide. Besides , the firm operates in different segments and offers a wide range of different brands. However the international strategy differs per product group. The main strategy in the firm is a mix of transnational and global. In some product groups (like wine and spirits) LVMH has to be aware of local responsiveness, local regulations and norms. The firm has to castigate to the environment. In contrast, product groups like, fashion and leather goods, are more in need of integration instead of local responsiveness, because the global need for the kind of fashion and leather goods is rather equal.The firm LVMH operates in five different sectors of the market. They offer products in wine and spirits, fashion and le ather goods, perfumes and cosmetics, watches and jewellery and selective retailing. Each product group is individual. on that point is little influence of the headquarter in each product group. The headquarter basically gives billet to the business divisions. This has the benefit that every business unit is flexible to adjust their structure to what suits their business unit and environment the best. However the organizational value are shared through the whole company. Summarized, looking at chapter 3 of the textbook Laserre ,it is clear that LVMH uses a sort of multi business global product division model.The employees have the freedom as long as they diddle their targets. In addition to this, Bernard Arnault described innovation as a driver for growth and profitability in the luxury industry. For LVMH quality in production and product development is essential for their success strategy. The firm pursues a strategy of soft human resources, meaning that no real hierarchies exis ts. This is resulting in that innovation is used in an excellent way. Additionally the firm offers training programmes, on the job training to motivate and in order of the development of the employees