Prepared by: Irene, Haiyun, Ted, Larry , Angela and Ada Presented by: Ada

  Expensive

  Exclusive

  High quality

  Only accessed by the privileged

Maslow’s Hierarchy of Needs

A specific strategy with exacting and stringent rules to be followed, with the aim of creating incomparability   Create by moving away from tangible

elements of comparison   focus on art and region-that intangible

that elevate people

Two major intangibles   Time date of birth, lasting in time   Provenance the charm of “made in…”

Behind the luxury brand there is the country cachet and culture. They are bought for being the finest objects and services a country can produce.

  With 1500 Japanese luxury buyers, 86% disagree to delocalize to countries with low labor cost

  Ipsos’ research in six emerging countries shows majority voting against delocalization

The reasons are:   Luxury evokes a product from

another country, especially western countries.

  As a gift like a trophy

To create the uniqueness and incompatibility, it takes…   full control of the value chain   highly selective distribution   one-to-one relationship with clients at retail level   high level of craftsmanship   exceptional level of quality   no licenses   no super-sales, no promotions   developing brand awareness well beyond the core

target   always increasing average prices   strong involvement with arts   beware of celebrities

  Do not need lasting quality   Sell at the highest possible prices at the

beginning of the season, super sales in the factory outlets

  require fast inventory turn over   Lower the cost of production as much as

possible   The designer is the strong values held

and promoted by the brand   Specialize in creativity design and

marketing

  Based on manufacturing of best-in-class products with an image of style

For instance, scientific evidence is most important factor for the skincare sector

  delocalization diffuses the unique country know-how, thereby destroying levers of added value

  access to higher volumes of production makes the product no different from other consumer goods, thus destroying the inaccessibility

"When one of our products gets too successful, we stop it.“ CEO of Hermes.

  keep the local sub-contractants running

  Keep alive a historical know-how

  a long-term vision that precludes falling in the trap of short-term benefits