Strategies of expansion at the time of deceleration: The case of LVMH

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Strategies of expansion at the time of deceleration: The case of LVMH

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Abstract

The year 2004 represented one of the best year that the world economy has experienced since the beginning of the millennium. Indeed the growth of the Gross World Product (GWP) has increased by 4 per cent in 2004 compared to only 2.8 per cent in 2003. However this high rate of growth in 2004 can be easily explained by the fact that the improvement was almost universal. Indeed all the regions of the world reached impressive growth rates in 2004 compared to the figures of 2003. Even countries in specific conditions of development, "the least developed countries and landlocked countries, grew by more than 5 per cent during" this year. Nevertheless the economic situation among Triad countries (Japan, Europe and the United States) has not been so successful. Indeed major economic problems remain in Europe, especially the high rate of unemployment, and in Japan also, which represent two of the 3 most important markets for LVMH. For the year 2005, economic results are even weaker. According to the WTO economic analysts world output decreases. This is partly attributed to the huge increase of oil prices, which have slowed down the world trade growth in 2005.

Introduction.
Background to the dissertation topic.
1. The global economic situation.
2. The luxury industry: Key drivers of the market.
3. Presentation of the company LVMH.
Research objectives.
1. Research problem.
2. The objectives of the research.
3. Structure of the proposal.
Definition of the terms.
1. Luxury industry.
2. Strategy.
The different strategies used by LVMH.
1. Diversification strategy.
2. Portfolio management.
3. Synergies.
Methodology.
1. Design.
Method & data collection.
1. Primary data.
2. Secondary data.
Reliability/Validity.
Limitations.
Timetable.
Expected results.
References.

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[...] I will start to write the findings of my research and the remaining chapters as soon as the beginning of October in order to be able to send a first draft to my facilitator to change it according to her feedback. In November my time will be dedicated to the final draft that I will submit mid-December. Activity May June July August September October November research Research Proposal Expected results Through this investigation I would like to be able to determine the key strategies that LVMH implemented to become the leader of the luxury market in only [...]

[...] Consequently it is interesting to understand the strategic tools that are used by these kinds of companies and more precisely by LVMH to give to their clients the desire and even to some extent the need to buy expensive commodities in a sullen economic environment The luxury industry: key drivers of the market Imperfect competition The luxury market does not come up to the perfect competition characteristics. The perfect competition can be defined as economic model that describes a hypothetical market form in which no producer or consumer has the market power to influence prices. [...]

[...] Methodology 4.1 Design According to the title “Strategies of expansion in time of recession: the case of a single case study is used to address the research question. A case study is an extensive examination of a single instance of a phenomenon of interest and is an example of a phenomenological methodology. The importance of the context is essential and Eisenhardt (1989) refers to the case study as a “research study which focuses on understanding the dynamics present within single settings”. [...]

[...] Chapter 3 will provide a critical review of existing literature in the field of strategy and of the luxury industry. It begins by giving basic elements to understand the specificities of the industry Furthermore, it looks at the different strategies that can be implemented by companies in time of recession in order to maintain their profits and their range among their competitors. Chapter 4 will then describe the methodological approach, covering issues such as research design and data collection . Finally a timetable is presented in the section 5 to describe the different stages of my research. [...]

[...] The best opportunity to conduct this research will be to interview at least five professionals of this particular sector: 3 top managers in the LVMH group from different divisions. Indeed it will be more interesting to have interviews with managers from the different divisions because they may have a different way to analyse and understand the strategies adopted by LVMH. 2 economic analysts from newspapers or consulting companies. They have an external vision which can be more objectives in the sense that they are not stakeholders of this firm. [...]

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