 Micro-environment

Firstly, the competition from substitues is moderately low. Elite customers who are mostly loyal
to the brand and do not switch easily. Christian Dior differentiates its product offerings and
emphasizes better customer experience through “ attention to detail” and “ product of
distinguished quality”. Major threat: counterfeit products are available in the market at cheaper
prices.
Secondly is the competition from new entrances. Christian Dior focuses on the uniqueness
of the products so economies of scale is insignificantly applicable. Has differentiated
product offerings which makes it difficult for new entrants to imitate.Initial capital
investment deters new entrants since Multiple investments are required. Switching
cost is high due to the brand value adding on to the psychological and economic cost.
Distribution channels: Making global presence and attaining market.
Another competition is from the established rivals. In the high-end fashion industry, the
players are few but customer loyalty is intense. There are many rivals in the industry
who are dealing in the luxury items like Balenciaga, Bottega Veneta, Gucci, Alexander
McQueen and YSL, etc. The barriers to entry are very high. Christian Dior has built
the intangible image and perception around the brand.
Last but not least is the power of suppliers, which is pretty low. The company
purchases raw materials from suppliers on the basis of consignment, which reduces
the loss marking and established economies of sale. LVMH - company owns Christian
Dior - has recently taken over Les Tanneries Roux, a leather supplier. Christian Dior
would be able to save costs on storage space and make sure of the quality of
products supplied. The power of buyers is also relatively low. Customers do not have
a say in reducing the cost of the luxury products due to the brand appeal. Customer’s
inability to integrate backward because of low market knowledge, which further
reduces their negotiating power. Christian Dior targets a small market. Targets high
class societies with high income.

Competition from
new entrants

petition from
new entrants
petition from
new entrants
 Macro- environment
In terms of political aspect, there is no significant political affiliation. Political crackdown on gift
giving and corruption: In China, there is a ban on advertising that encourages luxury gifts to the
government. Socially, shifting of consumer preferences towards experiential spending.
According to Amit Kumar 2022: High end consumers also do not want to show wealth quite so
conspicuously so they tend to spend on experiences such as lavish vacations and dinners at
starred restaurants. Demographic segmentation impacting luxury market’s growth: since the
average age of luxury consumers is decreasing, brands are finding it necessary to reexaminr
their strategies and adjust to what Millenials and Generation Z expect from them.

ENVIRONMENT
Carbon footprints in the atmosphere.
Eco-friendly packaging and raw materials and in opera-
tions.
Renewable technology.
The transportation of one product from a factory to the
store adds to the damage inflicted on the environment
by releasing gasses and chemicals.
Consumers are concerned about the raw materials,
especially animal leather.
Extreme weather leads to an increase in operation cost.
In the environment aspect, carbon footprints in the atmosphere. Ecofriendly packaging and raw
materials and renewable technology in operations. The transportation of one product from a
factory to the store adds to the damage inflicted on the environment by releasing gasses and
chemicals. Consumers are concerned about the raw materials, especiallt animal leather.
Extreme weather lead to an increase in operation cost.

Technology allowed an expansion that resulted in attracting a large customer segment. The
democratization of luxury has been facilitated by the Internet, consumers can easily reach
giving access to detailed information and facilitating consumer to consumer interactions. Many
brands now offer personalization services in their boutiques. Enhanced customer service by
offerings utilizing digital features. Digital marketing ( interacting websites, social media and
mobile applications)

Last but not least is the legal aspect. There are some legal regullations such as export and
import restrictions. Unsustainable and unethical actions within luxury brands have been
criticized over the years. Organizations are leading the movement and publicity exposing the
biggest brands to raise awareness about unethical behavior. IP Rights and intellectual property
need to be controlled.
3,

ENVIRONME
NT
Carbon footprints in
the atmosphere.
Eco-friendly packaging
and raw materials and
in opera-
tions.
Renewable technology.
The transportation of
one product from a
factory to the
store adds to the
damage inflicted on the
environment
by releasing gasses and
chemicals.
Consumers are
concerned about the
raw materials,
especially animal
leather.
Extreme weather leads
to an increase in
operation cost.
ENVIRONME
NT
Carbon footprints in
the atmosphere.
Eco-friendly packaging
and raw materials and
in opera-
tions.
Renewable technology.
The transportation of
one product from a
factory to the
store adds to the
damage inflicted on the
environment
by releasing gasses and
chemicals.
Consumers are
concerned about the
raw materials,
especially animal
leather.
Extreme weather leads
to an increase in
operation cost.
ENVIRONME
NT
Carbon footprints in
the atmosphere.
Eco-friendly packaging
and raw materials and
in opera-
tions.
Renewable technology.
The transportation of
one product from a
factory to the
store adds to the
damage inflicted on the
environment
by releasing gasses and
chemicals.
Consumers are
concerned about the
raw materials,
especially animal
leather.
Extreme weather leads
to an increase in
operation cost.
ENVIRONME
NT
Carbon footprints in
the atmosphere.
Eco-friendly packaging
and raw materials and
in opera-
tions.
Renewable technology.
The transportation of
one product from a
factory to the
store adds to the
damage inflicted on the
environment
by releasing gasses and
chemicals.
Consumers are
concerned about the
raw materials,
especially animal
leather.
Extreme weather leads
to an increase in
operation cost.
ENVIRONME
NT
Carbon footprints in
the atmosphere.
Eco-friendly packaging
and raw materials and
in opera-
tions.
Renewable technology.
The transportation of
one product from a
factory to the
store adds to the
damage inflicted on the
environment
by releasing gasses and
chemicals.
Consumers are
concerned about the
raw materials,
especially animal
leather.
Extreme weather leads
to an increase in
operation cost.
ENVIRONME
NT
Carbon footprints in
the atmosphere.
Eco-friendly packaging
and raw materials and
in opera-
tions.
Renewable technology.
The transportation of
one product from a
factory to the
store adds to the
damage inflicted on the
environment
by releasing gasses and
chemicals.
Consumers are
concerned about the
raw materials,
especially animal
leather.
Extreme weather leads
to an increase in
operation cost.
ENVIRONME
NT
Carbon footprints in
the atmosphere.
Eco-friendly packaging
and raw materials and
in opera-
tions.
Renewable technology.
The transportation of
one product from a
factory to the
store adds to the
damage inflicted on the
environment
by releasing gasses and
chemicals.
Consumers are
concerned about the
raw materials,
especially animal
leather.
Extreme weather leads
to an increase in
operation cost.
ENVIRONME
NT
Carbon footprints in
the atmosphere.
Eco-friendly packaging
and raw materials and
in opera-
tions.
Renewable technology.
The transportation of
one product from a
factory to the
store adds to the
damage inflicted on the
environment
by releasing gasses and
chemicals.
Consumers are
concerned about the
raw materials,
especially animal
leather.
Extreme weather leads
to an increase in
operation cost.
ENVIRONME
NT
Carbon footprints in
the atmosphere.
Eco-friendly packaging
and raw materials and
in opera-
tions.
Renewable technology.
The transportation of
one product from a
factory to the
store adds to the
damage inflicted on the
environment
by releasing gasses and
chemicals.
Consumers are
concerned about the
raw materials,
especially animal
leather.
Extreme weather leads
to an increase in
operation cost.