Three secrets of success you can still apply today from the world’s most valuable luxury brand
Louis Vuitton. It’s the brand with the Midas touch. $15 billion of revenue generated just last year. 30% of profits margin. And ranked 9th according to Forbes’ annual list of the World’s Most Valuable Brands – still winning during the ongoing Covid-19 pandemic. Maybe this true story can teach us a few things about marketing success?
It may indeed contain proven knowledge that business men have been searching for since time began. And it all started in 1821. That year, in France, the young Louis was born an ordinary man. He grew up in a small village in eastern France. His dad was a farmer. Nothing yet would lead us to think that he would become so successful…
At the age of 13, shortly after his mother died, he made a decision which would change his life. He decided to move to Paris… by feet! He wanted like most people to be respected, successful, admired. But the young Louis was penniless. It took him two years and countless temporary jobs to reach Paris. A few decades later on, the rest became history.
In my opinion, here are 3 factors which massively contributed to his success story:
1.Turn your product into a symbol of status for the consumer. The French philosopher Pascal used to call this the libido dominandi. Wearing a Louis Vuitton purse is a way to dominate others. The more expensive it is, the harder it is to get, the higher the perceived domination will be. This was reinforced by their lifetime guarantee: You will never need another purse once you own a Louis Vuitton.
Why it still works today: This prestige effect is universal. It’s the same reason why some consumers choose to buy premium brands rather than colourless, flat, ordinary products. Starbucks is a good example of how even a mass market product can be branded using this technique. “My friends and I are always sitting in strategic places, where we could be seen by others wearing our Starbucks cup” was quoted in a recent study done on millennials
2.Price is a valuable position, so do not cheapen it. In others words, do not worry about the price, worry about the value of your brand instead. You can not really compete on price anyway because another competitor will always be able to charge less. Louis Vuitton handbags are waterproof and fireproof. This is part of why they are so expensive.
Why it still works today: Affluent buyers are willing to spend more if it means getting a proven, higher quality product. Today Rolls Royce deliver less cars but achieve more. Why? Because they offer tailor-made orders.
“A key moment of Louis’ career was when he was asked to make a special order for a celebrity. This special buyer was Napoleon III’s wife”
3.Turn ambassadors into promoters of your brand, for free. A key moment of Louis’ career was when he was asked to make a special order for a celebrity. This special buyer was Napoleon III’s wife. It enabled him to attract elite and royal clientele.
Why it still works today: Oprah has been endorsing books in her latest club book. “East of Eden” is a novel from 1952 that used to sell 52 000 copies a year. After her recommendation, the book sold 1 million copies, just in the first week. From 50,000 to 1 million copies. That is the power of PR from a third, trusted party.
This article is written by the Parisian owner of the marketing agency Tony Lux, the original inventor of Marketing Luxury Goods the French Way. Tony is teaching marketing secrets from brands like Dior, Chanel or Louis Vuitton… And how to make them work for your specific business, even if you are not in the fashion, food or luxury industry… For more information visit: www.tonylux.com