Louis Vuitton Porter's Five Forces Analysis

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Introduction Described in this paper is Louis Vuitton’s (LV) evaluation of the external and global environment of LV in Japan. We will discuss the remote, industry, and operating of the external environment along with the factors involved in the global environment utilizing the S.W.O.T., P.E.S.T.L.E., RVINE, and Porter’s Five Force analysis tools. Known as one of the oldest French luxury fashion houses, “Louis Vuitton”, an international, well-established brand mostly famous for its craftwork leather bags and trunks was established in France in 1854 by Louis Vuitton Malletier. In 1885, the firm opened its first overseas store in London, England, on Oxford Street. Louis Vuitton developed the Canvas Damier Pattern in order to make the Louis…show more content…
In their case, battling against issues such as the falsification of the logo and market dilution of counterfeit bags threatening their market (Pearce & Robinson, 2013). Remote environment presents LV with opportunities, threats, and constraints in the operating situations of economic, social, political, technical, and ecological factors. Globally, 45 % of all luxury goods sold in Japan making it the paradise market for luxury brands (Pearce & Robinson, 2013). Louis Vuitton’s Global Environment P.E.S.T.L.E. Analysis Political factors: Emerging market, open to investments, stable environment. Economic factors: Growth in middle class, low inflation rate, high labor force, high per capita income. Social factors: Consumer preference changing, high demand for luxury goods, culture of exclusive life style. Technological factors: Internet advancements, increasing trends in mobile devices. Environmental factors: Strong environmental policies, natural disasters, air pollution, global warming. Internal Analysis VRINE Key success factors: Exceptional brand image, quality and loyalty, and product differentiation. Porters 5 Forces Threat of New Entrants: This is very low in this industry. Even with the luxury goods market on the incline, new companies would not enter the market due to the

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