In 1854, the label of Louis Vuitton was discovered by “Vuitton” on Rue Nuevo des Capuchins in Paris. Louis Vuitton is one of the world’s famous luxury brands for leather goods like handbags, trunks, perfumes, accessories, sunglasses, shoes and watches. The headquarter of the company is located in Paris, France and around 121289 employees are working in the company. The preceding analysis is based on the Ansoff matrix of Louis Vuitton.
Market Penetration
A condition or a decision made by the organization to monitor and evaluate its current operations in the areas where the company is already operating its business activities and increase its market share through the production of its existing product range. The purpose of market penetration may also be based on the production of new items in the current marketplace. A firm can successfully penetrate the market by using appropriate advertising plans through media. If we consider an example of Louis Vuitton then it is already executing market penetration strategy and currently, it has highly expanded its market share. Furthermore, it has been recommended that a firm must focus on opening its retail shops in different marketplaces like in the streets and other cities. It’s not just enough to have a retail shop in only classy malls. If a firm wants to expand its market share to a larger extent then it must inaugurate its retail stores in small areas as well(Kasalia, 2017).
Product Development
The process of developing new items for existing consumers to increase sales and revenue of a firm. The product development plan would be beneficial for the Louis Vuitton if it starts producing footwear for children and adults. In this manner, Louis Vuitton would be able to attract its customers and buyers would purchase these shoe products maybe not for themselves but their children. It has been observed by several researchers that, the customer always wants to feel the class and touch of new products in the market. So, the introduction of pf shoes would enforce the buyers to purchase a pair of shoes, that would increase the sales of Louis Vuitton.
A large number of financial resources would be required to open new retail shops and to promote a new product in the existing market. Louis Vuitton is already earning huge profit through its present sales and production and it would not be difficult for a firm to arrange funds for its new product. Besides, other resources like adequate manpower would be required to perform operational activities and to get feedback from customers regarding their preferences about fresh items(Kasalia, 2017).
Market Development
It is a plan or policy used by the firms to maintain their business growth by providing or launching their current goods and services in a completely new market. Louis Vuitton is performing its business operations at a global level except for Africa. There are few other developing countries as well, where Louis Vuitton has not its existence The majority of the developing nations with a high level of unemployment are still not enjoying the products developed by Louis Vuitton. In this situation, it would be quite beneficial for a firm to open its retail stores in developing nations to expand its profit earning ratio. Expansion in the continent of Africa would not be considered a good choice because the nature of the Louis Vuitton products is not like that to be sold at a low price and the purchasing power of African consumers is very low. So, it would not be a suitable growth choice to expand business in Africa(Kasalia, 2017).
Diversification
It is a technique used by the organizations to expand their business to introduce new goods by entering into new demographic places. By considering the example of Louis Vuitton, it would be an extremely risky step. For instance, if a firm decides to start its business in Africa by producing shoes for children and youngsters then it may have a chance of failure. The reason behind this fact is that Africa is a poor country and the majority of its consumers have low income and they can’t afford to purchase expensive products from top brands like Louis Vuitton. However, if a firm will introduce a new product, the African consumers would not even buy to get the first experience because their purchasing power is very low and Louis cannot sell its goods at very low cost (Kasalia, 2017).
References
Kasalia, A. (2017). LOUIS VUITTON ful appraisal April.