CASE STUDY

Marielle AH-CHINE
Kristina BOKOVA
Margaux CHERIF-CHEIKH
FENG Tiantian
HUANG Yingying

COMPETITIVE ANALYISIS
Industry Forces
ABSOLUTE LUXURY/HIGH-END LUXURY SEGMENT
Competitors other haute couture houses
(Chanel, Christian Dior, Jean Paul Gautier, Valentino, etc. )
ELIE SAAB
-Competitive Couture Pricing Without Compromising On Service
-Exceptional Service & Top-of-the-line Quality
-High Exclusivity
-Customer Segments Targeting Super-wealthy, High-end
Market (Celebrities, Royalty, Rich And Famous)

Industry Forces
Substitutes
- Democratization of fashion - H&M x MMM
Suppliers
- Very dependent on materials and fabric suppliers

FORESIGHT
Key trends
Technological trends
- increasing influence of social media and digital
marketing activities
Regulatory
- Tax advantages in some countries
- Higher prices due to import duties and taxes

FORESIGHT
Key trends
Socioeconomic trends
- Growing number of extreme net-worth individuals,
especially in Asia
Chinese consumers account for 20% of the global
luxury sales
Asian consumers (i.e., adding Japan, Korea, and
Southeast Asia) account for more than 50% of the
global luxury sales

MARKET ANALYSIS
Market trends

Market Issues

Changing consumers taste and preferences

Younger consumer base in Asia
Aging of customers in Europe, US & Japan

Market Segments

Accessories & hard luxury largest category

Needs & Demands

chase for higher quality and greater craftsmanship/materials

favors absolute/high-end luxury offerings

MARKET ANALYSIS
Market trends
Switching Costs
- High brand loyalty
Revenue Attractiveness
- Asian market (China and Hong Kong) + emerging
Markets
- Absolute luxury segment 40B in 2011

MACROECONOMICS
Macro-economic forces
Global market
- Luxury fundamentals
remain strong in the
medium term

BUSINESS MODEL
Value Proposition
Design - Brand/status Customization - Price
NEED?
A unique design made of exquisite materials
WHAT?
Haute Couture, RTW, accessories and wedding dresses
FUTURE?
Any luxurious and exclusive products

Efficiency of fittings
Personalized services
Lifetime experience
Very selected manufacturers

BUSINESS MODEL
Customers
Niche market
PRIMARY TARGET:
Feminine, Elegant and
Super Wealthy Women
NATURAL TARGET:
Celebrities and Royalties
FUTURE PLANS:
To diversify

Personal
assistance
Co-creation
Self-service

BUSINESS MODEL
Distribution Channels
AWARENESS:
Events, Catalogues, Advertorials to the corporate website, Interactive portal,
Ads
EVALUATION:
Visit the stores, Try the dresses, Watch the catwalk shows
PURCHASE:
Flagship stores, Concessions, Multi-brand retailers, Catwalks
DELIVERY:
On site, at home
AFTER SALE:
Guarantee repair

BUSINESS MODEL
Key activities
Design of luxury stores
Haute Couture
Customers proximity
Animate the online website

BUSINESS MODEL
Key resources
PHYSICAL:
Stores, fabrics, sewing materials
INTELLECTUAL:
Website
HUMAN:
Creative + Business
FINANCIAL:
Shareholders, Bank loan

BUSINESS MODEL
Key partnerships
TO BE SOLD:
Retailers, Department stores, Beaut Prestige International

TO BE KNOWN:
Celebrities, Charitable organizations

TO EXPAND THE BRAND UNIVERSE:

Hotels, Yacht companies

KEY SUPPLIERS:
Fabrics supplier, RTW manufacturer

BUSINESS MODEL
Cost and Revenue structure
MOST IMPORTANT COSTS:
General, selling and administrative expenses, Cost materials and
outsourced production, Salaries and Fashion shows
THE MOST EXPENSIVE KEY RESOURCES:
Stores and Fabrics
THE MOST EXPENSIVE KEY ACTIVITY:
Fashion shows
REVENUES:
Sales, Licensing, Partnerships
RTW: $1500-$21000
Haute Couture: $34000-$1000000

ESs core business:

Haute Couture.

Four primary product lines:

Haute Couture,
RTW,
Accessories,
Wedding Dresses.

Diversified :
enhance its prestige in every aspect of the luxury sector.

SIGNATURE HOTELS
2008 Tatweer/Dubai Properties
Signature Hotels

U.K. BOUTIQUE AT HARRODS

2008.7 Eveningwear Department, First Floor

PARFUM ELIE SAAB

2009.9
10-year fragrance and cosmetic license contract.

LUXURY YACHTS DESIGN

2010.1 Weyves International Ltd.
and Oceanco

FLAGSHIP STORE IN DUBAI

2010.7 First flagship store in the Gulf region, The Dubai Ma

VARIOUS MODES OF ENTRY

Licensing
Partnerships
Third-party Distribution
Company-owned Stores.

Licensing
PROS AND CONS
Minimizes risk and investment.
Speed of entry
Able to circumvent trade barriers
High ROI (Return On Investment)
Lack of control over use of assets.
Licensee may become competitor.
Knowledge spillovers
License period is limited

Partnerships
PROS AND CONS

Overcomes ownership restrictions , cultural distance

Combines resources of 2 companies.
Potential for learning
Difficult to manage
Viewed as insider
Dilution of control
Less investment required
Greater risk than exporting a & licen
Knowledge spillovers
Partner may become a competitor.

Third-party Distribution
PROS AND CONS

Trade barriers & tariffs add to cost

Minimizes risk and investment.Transport costs
Speed of entry
Limits access to local information
Maximizes scale;
Company viewed as an outsider
uses existing facilities.

Company-owned Stores.
PROS AND CONS

Greater knowledge of local market

Can better apply specialized skills
Minimizes knowledge spillover
Can be viewed as an insider
Higher risk than other modes
Requires more resources and commitment
May be difficult to manage the local resources.

Strengths, Weaknesses,
Opportunities And Threats (SWOT)
Analysis
ESs Competitive Advantage?

SWOT
Strengths

Member of the Chambre

Syndicale de la Couture
Direct ownership of its stores
except Dubai (for local expertise)
One of the few certified
Couture house
Trust and loyalty of stars and
royalty

Opportunities

The rise of the number of World

High-net-worth individuals
(HNWI) and of their wealth,
especially in Asia
The asian market
Huge potential in Asia not yet
fulfilled

Weaknesses

Weak presence in multi-brand

shops
The dilution of the brand into
many activities(yachts, hotels)
and the plan to expand even
further
Still low sales in Asia, USA and
Russia

Threats

Trend: to mix luxury and

affordability
Trend: people tend on dressing
more casual
Party ladies are no longer highclass aristocracy but new-world
billionaire

Elie Saabs competitive

advantage
The ultimate personalized experience
provided by the brand for Haute Couture customers.
+ the personality and know-how of the designer
Elie Saab

Elie Saab really applies the principles of Haute

Couture.

STGAE OF Product Life Cycle

Change OF Companys Positioning And
Differentiation Strategy

Haute couture: Maturity phase.

Elie Saab has a great expertise in this activity.
Sales are hight but tend to stagnate.
Ready-to-wear & accessories: Sales are in
constant progression.
More recent activity in Elie Saab portfolio.

Positioning and differenciation

At first, the brand focused exclusively into Haute
Couture and exceptional custom-made clothing
for super wealthy customers.
Launch of a Ready-to-wear activity to extend
the portfolio
More affordable and easier to produce in
large volumes
A greater return on investment and turnover.
Less exclusive global situation but more
accessibility and commercial attractiveness

Should ES target a new market?

For example, the emerging affordable luxury market?

Our answer is:

Affordable Luxury Market

lower cost (material/human)
higher production volume

higher turnover
higher profit margin

Haute Couture vs Ready-to-wear

more accessible
-Main income
resource

Catered to super wealthy

-Rarely sold

Similarly

Geographically

e.g. CHINA

In these emerging markets

BUT
The prerequisite of this strategy of growing in new
markets is to maintain the brands image and
prevent it from being diluted .
Individualization

Communication

loyalty

OVERALL RECOMMENDATIONS

Marketing Mix Strategy

Our overall recommendations for ES

Maintain is brand image:

High-end, one-of-a-kind designs

made from the finest fabrics and
materials

High quality customized service

Product
Diversification
Mass class - main part of luxury consumers
Accessories & cosmetics, etc.
New rich status/wealth
Domestic outfit, luxury hotels, automobiles and
yachts decoration, etc.

 Consolidatio
n

The haute couture

has always been and
must continue to be
the core and soul of
ESs business.

Pricing
A pair of sunglasses

350 400

A custom-made couture
gown

$30,000 - $1,000,000

A pair of plain trousers

$1,200

A fur jacet

$21,000

If asked to equate ES with examples of automobiles

Promotion
Increasing promotion
spending on new media

Making full use of celebrity effect

Distribution

Another trend in the luxury industry is that

manufacturer/retailer relationships have lost an
element of trust.

A bad choice of licensee retailer may result in a

disaster for a brands image.

Company-owned Stores

HONG KONG, Jan. 2012

Merci !