LVMH Chair 2016 –2017

Fundamentals of Luxury 

Anastasia Belugina
Seminar 1
Rose de Vents Turbulences Dans la peau Apogée Contre moi Matière noire Mille feux

Wind of Roller coaster Leathery Back to Comfort Diving into the Glaze of glory
farewell animalistic nature unknown
Damas rose, Tuberose, Musk, narcisse, Magnolia, Vanilla trio, Agar wood, Osmanthus, iris,
black pepper jasmin peach rose, wood orange blossom patchouli safran

FINDINGS PROFESSIONAL OUTPUTS

•  LV already had produced perfumes: Heures d’Absence
and JeTuIl. However, the juices were lost and not
produced since 1920s so the brand had to recreate the
“métier” from scratch. I was deeply impressed by the
level of excellence and rigor at each and every step of
the process.
•  LV together with Dior bought and recreated Les
Fontaines Parfumées, iconic perfumery atelier in
Grasse. Jacques Cavallier-Belletrud worked there on
the collection, made more than 400 trials.
•  The bottle, as usually in luxury niche perfumery, looks
very simple but is actually a result of complex technical
development.
•  LV invented the new way to ferment natural leather,
iconic for the brand and essential in perfumery.
•  This seminar, led by Timothée Nicolas et Claire Desjardins,
was the most useful for me, as I am particularly interested
in marketing development of beauty products and
especially exclusive perfumes.
•  I developed better product sensibility, exploring olfactory
universes of LV perfumes. From a practical point of view, it
was very useful and enriching to smell the raw materials
and then each perfume.
•  It’s an exceptional positioning example: omni-present
communication (including printed visuals) and a celebrity
ambassador which is rare for niche perfumery.
•  I participated in the group case and worked on the
perfume concept from consumer insight to the name and
ingredients. The name we offered – A l’aube – that was in
LV’s shortlist.
Seminars 2 & 7
 FINDINGS
•  Christian Dior used to say, ‘I feel as much as
perfumer as a designer’. In his mission to enhance
beauty of women, make them feel fully beautiful, he
put a lot of importance on perfumes.
•  Since its creation in 1947, Christian Dior brand
incarnates absolute femininity and French art of
living. This is why beauty division is an essential part
of Dior universe, since the first lipstick launched back
in 1950s. I find the Collection Privée perfumes the
most inspiring part of it.
•  The ‘nose’ of the maison is François Demachy who
works at Les Fontaines Parfumées in Grasse, shared
with Louis Vuitton. The brand has also repurchased
and refurbished Dior’s house, La Colle Noire – and a
new niche perfume was launched to celebrate it.
•  43% of revenues of CDP comes from multi-brand
environment (Sephora, Marionnaud, etc), 26% from
department stores, 25% from travel retail, 3% from e-
commerce and 3% from Dior boutiques. However,
complete control is only possible at own boutiques
and Dior aims at develop them; they also recently
launched a pop-up perfume store in Paris.
PROFESSIONAL OUTPUTS
•  The seminar led by Priscilla Mark allowed me to discover
International Retail Experience department at Christian Dior. In
the long-term, I am aiming to work in marketing development;
I am convinced that deep understanding of retail is
indispensable for developing a unique purchasing experience
for the client and thus establishing brand loyalty, going
beyond a simple transaction.
•  During my internships in operational and strategic marketing
at Giorgio Armani, I had the opportunity to evaluate and
improve counters’ performance as well as to develop
creative sales tools, to brief visual merchandising and training
teams. It was exciting to find out how Dior approaches retail
compared to Armani. The brand puts a lot of focus on
digitalization of the store experience and worldwide mystery
shopping as a form of evaluation (contrasted to local used by
Armani).
•  After Chanel’s beauty store opening in the iconic part of the
Marais, I would expect Dior also to have a store dedicated
only to beauty to provide the best in-store experience.
•  Working on the case about Dior beauty counter showed me
the variety of responsibilities of the retail manager, from HR
management to preparing the new launch.
 FINDINGS
•  First, Natacha Hochet-Raab, who led this seminar,
reminded us the history and core codes of Dior: from the
iconic New Look to timeless femininity and elegance;
from art gallery at rue de la Boétie to Avenue
Montaigne. The codes are reinterpreted today by Maria
Grazia Chiuri, who put feminism at heart of her first
collection. Strong, independent yet always elegant
woman is Dior’s vision of a woman reincarnated.
•  I have also learnt a lot about marketing tools in fashion:
apart from classical fashion show, windows and
campaigns, there are moving cruise shows, worldwide
exhibitions, opening celebrations, Dior TV and Mag,
handwritten welcome notes and a lot more; these are
all ways to tell the brand’s and collection’s story.
•  Dior addresses its potential clients through targeted
lifestyle communities: for example, through closed
professional clubs, expats network, auctions, exceptional
dinners etc.
•  As it was shown with the example of air-balloon in
Courchevel, Dior is always audacious and revolutionary
in its communication.
PROFESSIONAL OUTPUTS
•  In luxury fashion and especially haute couture, retail goes
beyond the boundaries of sales.
•  Three main goals of retail are understanding clients,
recruiting new clients, developing current ones.
•  Diplomacy and communication skills are indispensable
skills of sales people. Beyond marketing campaigns, they
have to create a real relationship to offer the best client
experience. Nowadays, the best means personalized.
Dior representative in the boutique will not only offer a
personalized product selection but will know his client; the
seller will discuss politics, weather, trends, news, movies,
designs, will know what to offer to her spouse for
anniversary and when is her daughter’s graduation. The
client feels being treated as someone unique.
•  As usual, we worked on a group case. We had to come
up with ideas on how to communicate with millennials – a
challenge many luxury brands face today, because this
new generation is looking for new kind of luxury: not a
product, but experience. How and who should Dior
address? We proposed experience-events targeting
existing and potential future clients.
Seminar 3
 FINDINGS
•  In contrast with Louis Vuitton perfumes seminar, where we discovered the creation of a completely new
product line, this time, welcomed by the charming marketing team of La Petite Robe Noire, we saw a
successful example of a line extension.
•  La Petite Robe Noire was an exceptional launch: as opposed to all big competitors, it didn’t use any
celebrity. Instead, Guerlain created the unique drawn character that quickly became a world-renown
incarnation of Parisian style and brought LPRN to the bestseller perfumes.

PROFESSIONAL OUTPUTS
•  Guerlain is the oldest perfume house of France, with almost 200 years of history, a French beauty icon. With
LPRN, it managed to address a new clientele: young, international, yet ever more demanding; girls who
dreamt about their mothers’ Shalimar or Rouge G now have a perfect-fit product for them.
•  As a successful franchise, LPRN was subject to extension. I expected this to be a challenge for the brand, but
it was exciting to know more about the details: the biggest issue being the extent to which the original scent
is present and the novelty to complete the line. We also found out a secret: the LPRN line is to be continued,
with a Black Perfecto jacket – another iconic wardrobe piece, another exceptional marketing campaign!
•  I am personally deeply inspired by the work Guerlain did launching LPRN make up : it is a perfect example of
proposing a new seducing product with the already known identity of the perfume. Not only all the products
are perfumed and have the similar shape, they tell the same story and complete the look. There is no other
brand who would perfectly relate make up and perfume franchises and I am sure this launch will push
competitors to do copy it very soon!
•  As I am mainly interested in marketing development, I enjoyed the business case assignment: we had a
chance to propose a new make up product for LPRN, an innovative click-n-shake powder blush.
Seminar 4
 FINDINGS
•  Thanks to this seminar, led by Antoine Varlet, I
learnt a tremendous amount about production
of cognacs and brandies.
•  First of all, cognac is made from grapes from
Cognac region, distilled twice. The production
starts from winegrowing and distillation,
continues by ageing, blending, finishing,
bottling and shipping. 7 liters of wine are
required for 1 liter of cognac!
•  Hennessy is driven by uncompromising
excellence: master blenders from the same
family since 1800s (Yann Filloux today) choose
and combine eaux de vie every year to
recreate the perfect taste.
•  With 70 million bottles produced per year,
Hennessy is the second LVMH brand after LV
and the second worldwide spirit in value sales,
with 12% market share.
•  Hennessy’s marketing relies on LVMH approach:
not to do marketing, but to create desire.
  and applied to wines & spirits sector.
PROFESSIONAL OUTPUTS
•  Marketing challenge of Hennessy, a brand with 250 years
of history and a product price range from 20€ to
thousands, is to communicate with all its different
customers around the world – a young American buying
his Hennessy VS for a home party and a millionaire pre-
ordering his one and only limited edition cognac bottle.
•  I found it outstanding, and very interesting for me as a
future marketer, how Hennessy managed to speak to
these different audiences yet keeping its heritage. For VS,
the motto is “Never stop, never settle”, and the story
behind this very masculine, strong identity is about
reaching very ambitious, world-changing goals. VSOP
speaks about mastery and craftsmanship. The video for
XO enters a completely different territory: it’s a piece of
art, an Odyssey, reinventing a spirit campaign. The
image of cognac is not anymore associated with “an old
uncle in his armchair in front of a fireplace” and
Hennessy is the pioneer in reinventing it.
•  Hennessy shows how art collaboration can be reinvented
 Seminar 5: Luxury at LVMH
•  I have followed various academic courses dedicated to luxury but during her seminar Pauline Keijman made me question
my understanding of it. First of all, it was surprising to see how different languages describe luxury in dictionaries: the cultural
differences and mentalities define the attitude towards luxury. In some languages, it’s something excessive, unnecessary,
sumptuous, splendid. Surprisingly (or not?) only French language defines luxury through esthetics.
•  When Pauline asked us to give examples of luxury experiences, we’ve seen what unites them all: the feeling of being truly
exceptional human being and being treated as someone unique. Luxury is also something that undoubtedly goes beyond
basics - it’s out of ordinary, more than perfect.
•  There are endless controversies luxury brands have to reconcile – eternity (timeless values, continuous style and coherent
story usually referring to the past) and modernity, known (to be desired) yet exclusive (to be desired even more), instant
(today any information is accessible immediately) and eternal, sacred (religious origins of luxury) and profane (everyday
use products).
•  We also had the chance to know more about the structure of LVMH which is very different from other groups – only 600
people work in HQ and all houses are independent. After having worked at L’Oreal that is fully verticaly integrated, I can
see the difference it makes on both strategic choice and everyday employees’ life. For example, L’Oréal hires people for
the group and then places them to one brand, whereas in LVMH every maison hires on its own although mobility is possible.
Suppliers and research are different for every brand and you won’t see the same bottle in Dior and Guerlain, or the same
cream formula exchanged between two brands. This structure allows to maintain healthy competition and keep every
brand unique and independent to a certain extent.
•  LVMH acquires and nurtures only exceptional brands. Example that I found the most impressive was Guerlain and its launch
of La Petite Robe Noire – it was the only perfume, and even the only commercial product to be advertised on Colonne
Morris in Paris, usually dedicated only to cultural events. Because, in its way, it represents the French culture and lifestyle –
oh, pardon! – art de vivre. Each brand has an exceptional creator or craft and aims at excellence in every part of the
business and creation.
 Seminar 6: IPD at Louis Vuitton
•  I believe this seminar, led by Cyril Chanteloup and Claudia Martinuzzi, was the most revealing for us. Despite
seeing counterfeited products almost every day, I have never realized how widespread and harmful it is for the
brand. The importance of intellectual property department can not be overestimated: not only counterfeit
reduces potential revenues, but it strongly harms brand image.
•  The efficiency and creativity of counterfeiters is beyond imagination. We had a chance to see not only bags
and trunks but nails, doors and even a fake store. They are able to replicate a product and put it online for sale
within hours following the launch announcement on Instagram, as it happened with Louis Vuitton I-Phone cases.
•  It is very easy for a customer who is not very familiar with Louis Vuitton and luxury industry in general to fall into
counterfeit traps. The fake websites and marketplaces for counterfeit with ‘official’ explanation of low prices are
appearing every day. With a brief research online, I have found dozens of websites and Instagram accounts
selling obvious counterfeit, and the accounts had thousands of followers who do not even realize they are
committing a crime. It is thus very important to educate consumers, so that they know the monogram placement
and that they can’t buy LV anywhere but in the official store or website and that the brand doesn’t do discounts.
•  The motivation and determination of IPD team is outstanding. What a frustrating challenging job must it be –
fraud is always one step ahead! As Claudia explained, once she finds and persecutes a counterfeit website,
another one pops up, like a polycephalous hydra that can’t be killed. Despite every day fight, another fake
appears next day, another method of producing or selling counterfeit is invented.
•  IPD’s work requires a lot of collaboration with other brands but also with authorities: and it’s not easy to convince
them to spend their time chasing luxury bags’ forgers when they have murders to deal with. We also discovered
that there exists a deep connection between counterfeit and organized crime, the former being used as the
most profitable business branch.
Seminar 8
 FINDINGS
•  For the past several years, Chaumet is experiencing
an unprecedential growth. As Matthieu Ferry pointed
out, after the arrival of the new CEO, Jean-Marc
Mansvelt, and the strategic change, the brand is
growing at 44% a year!
•  The key to this success and increased visibility is in
focus on unique recognizable codes and digital
innovation. Today, Chaumet is even sometimes
called “the blue brand” for its iconic deep blue; the
brand also communicates about royal heritage,
Empress Josephine’s personality, but also about Paris,
love, youth and elegance. There are now only 3
collections present instead of 10: Josephine, Liens
and Garden; they are also separately in focus of
communication.
•  The brand put a particular focus on bridal collections:
apart from the video, a specific bridal part of the
store was created – ‘the perfect setting to say yes’.
The virtual tour helps discovering it online first and
facilitate the first step in the store at Place Vendome.
•  A historic exhibition in Forbidden City in Beijing is an
initiative to gain even more Chinese clients.
PROFESSIONAL OUTPUTS
•  At the selection day of the Chair, I have worked on Chaumet
Millennials case, and since three of us joined the Chair, we were
happy to work on this exciting topic again and review our
propositions. We came to conclusion that to speak to
millennials Chaumet needs to launch an Iconic Product in Liens
collection accessible for the first-time buyers. It should be The
jewelry piece to dream about, like Tiffany T or Infinity ring, or
Cartier love bracelet.
•  With its digital content, like the video Gaites Parisiennes, that
quotes all the codes, Chaumet enhanced a true Parisian
dream around the brand. It’s not surprising that Asian, Russian
and Middle East clients love Chaumet, because they usually
tend to be passionate about the dreamy picture of Paris,
France and French chic and elegance.
•  Chaumet created an outstanding application You, Me and
Paris, that offers the best Parisian activities for couples – walks,
museums, hotels, restaurants; walks pass sometimes by
Chaumet boutiques or iconic places (e.g., Malmaison). Not
only I am personally using this app since launch, I also believe
it’s among the best digital ways to tell the brand story,
compared to the Rendez-vous app by Ruinart, offering 50
events in Paris accompanied by champagne.