Opinion

LVMH - keeping luxury current

02 October, 2018 Share socially

As the only rigorous assessment of how future proof the world’s 100 most prominent companies are, we ask an informed global public for their views on brands they are both aware of and know something about. Their responses broadly determine a brand’s ‘purpose’ and ‘experience’ dimensions – both critical to making a brand future proof.

This year’s research has placed LVMH at 70th in the index, a drop of more than 50 places since 2016. So, what’s causing the luxury group’s perceived fall from grace? 

LVMH - keeping luxury current

Although it has declined against every attribute, the greatest drops are in the ‘purpose’ dimension. To better understand why this may have such an impact on ranking, we need to look at what’s driving true luxury, globally. Gone are the relatively recent days when luxury brands needed only to call upon their distinguished lineage to succeed. As Thomaï Serdari, adjunct associate professor at NYU observes, “True luxury is a promise for the future: it's looking around to see... how life is going to change in terms of technology, to experiment and to always look forwards, not backwards.”

By weakening in key attributes such as ‘thought-leadership’, ‘mission’, ‘inspiration’ and ‘innovation’ – effectively standing still rather than moving forward – the group isn’t giving consumers a continued reason to engage. This is tellingly demonstrated in the fact that one of the most selected emotional reactions to the group is ‘indifference’.

By moving from simply ‘excellence in execution’ (no-one doubts the continued quality of what the group produces) towards a ‘culture of excellence’, whereby providing access to the ordinarily inaccessible, demonstrating ongoing discovery and disseminating inspirational knowledge and thought-leadership become guiding principles, we feel the group has the potential to move up the index. 

Adopting these behaviours could also help the group to retain its relative strengths in ‘individuality’, ‘story’ and ‘personality’ – the bedrocks of any luxury foundations, and ones which cannot be left to decline.

By implementing these changes, it could be hoped that ‘passionate’ becomes a more selected measure of emotional engagement, and the group’s status as a future proof brand is assured.