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In the year 2019, significant growth was observed in the luxury goods market due to the vitality shown by the categories of personal luxury products. In India, there is a majority of the younger population and therefore, the brand observed high performances in designer apparel, footwear, luxurious as well as portable consumer electronics, designer eyewear, and premium quality beauty products and personal care items due to successful efforts made by the manufacturers in targeting the youngest population's lifestyle (Country Report 2020). The luxury brands are looking to expand into markets beyond the tier 1 cities (Lagier and Ranfagni 2018). For doing this, the premium and luxury car manufacturers are formulating strategies to establish workshops in lower-tier cities and e-commerce platforms are being used by the personal luxury brands to expand their reach and increase distribution (Country Report 2020).
Dior represents elegance, luxury, and excellence. It has continued to motivate the fashion industry using its elegant and stylish design for over 70 years (Antonaglia and Ducros 2020). It was found by Christian Dior and it deals in design, sales, and marketing of fashion apparel, accessories, and beauty products. The brand can use the following STP strategy to grow in India.
It can segment its target market based on demographic factors, psychographic, and behavioural segmentation (Andaleeb 2016). Demographic segmentation will divide the target market based on variables such as age, gender, family, size, income, religion, occupation, race, and nationality. Psychographic segmentation is another way to segment the target market based on their lifestyle, values, and attitudes (Camilleri 2018). The Dior brand can make use of differentiation strategy for targeting customers as the products offered by the brand differentiate themselves from the other competitors by being best in quality as well as reducing their impact on the environment (Andaleeb 2016). The brand can position itself as a brand that provides high-quality luxury products and is changing the prevailing trends of the fashion industry.
The one target market that I would recommend for the LVMH's luxury products in India. As it has been forecasted that there is a continued growth over 2019-2024 in the Indian market due to increasing frequency of individuals with high incomes and also the continuing growth of urban people who are young and belong to a middle class, India would be the right target market for Dior's Luxury products (Country Report 2020). The brand can create a great value proposition by identifying the benefits offered by the products, and describing how the products can prove to be beneficial for the target customers (Ji 2016). There is a need to know about the customer’s main problem, then use this problem and connect it with the brand’s product offering. The brand must differentiate itself by showing how the products provide a solution for the customer’s problems (Ji 2016). In India, the young population will be attracted to designer footwear and apparels, luxury eyewear, portable and luxury electronics for consumers and high-quality personal care and beauty products because of the lifestyle of millennial and Gen Z consumers (Country Report 2020).
The target market is divided using three major market segmentation strategies:
The above Segmentation helps the brand to know about the needs and tastes of the customers.
The target market of the brand is segmented into people who are rich, professional, and high-income or motivated middle-class people (Donzé and Wubs 2019). The market size is quite big. Therefore, there is a huge potential in this market because people continuously desire to have high living standards and their first choice for this is luxuries. Dior has other competitors that have the same target market such as Gucci which makes it difficult for any other rival to enter the market (Donzé and Wubs 2019).
Dior uses differentiation as its target strategy. There are different marketing strategies used by the brand to market and target different segments of customers as per their needs. Dior also focuses on some sub-segments and produces special products for this small segment.
The marketing strategy used by the brand for positioning is based on their customer’s point of view (Kostelijk and Alsem 2020).
For example, it can be based on the characteristics of products offered by the brand such as the Dior product is elegant and is a luxury for people.
It can be based on the occasion of usage. Many customers do not buy Dior product always; they may not require the product every day or each week. However, they may buy the luxury Dior product once or twice a year.
The brand can position itself against its competitors by defining how their product is different from the competitor’s products (Roux, Tafani and Vigneron 2017). As the sales of the Dior products are increasing continuously while there is not much change in the competitor's sales which means that Dior is in a safe position.
Dior differentiates its product as there are many other famous brands like Gucci and L.V but their products don’t have anything special in them. On the other hand, Dior can help in bringing a unique and fresh range of different categories of luxury products.
The brand may use the advancing focus on sustainability factors in product categories. The growing awareness of consumers on sustainability is playing a major role in the consumer demands of luxury products (Country Report 2020).
Other areas of opportunity for the Dior brand include the growing tendency to privilege experiences over possessions especially for players such as luxury hotels, luxury foodservice, and fine wines/champagne and spirits. For targeting young customers, the brand must improve their digital strategies to strengthen their brand and reach more young consumers via social media. This would help the brand in creating a strong connection with the consumers (Country Report 2020).
Andaleeb, S. S. 2016. Market segmentation, targeting, and positioning. Strategic Marketing Management in Asia, pp. 179-207.
Antonaglia, F., and Ducros, J. P. 2020. Christian Dior: The Art of Haute Couture. In The Certification of Luxury Fashion Brands, 113-139, Palgrave Pivot, Cham. [Online]. Available at https://link.springer.com/chapter/10.1007/978-3-030-26121-4_5 [ Accessed on 28th August 2020].
Camilleri, M. A. 2018. Market segmentation, targeting and positioning. In Travel marketing, tourism economics and the airline product (pp. 69-83). Springer, Cham. [Online]. Available at https://link.springer.com/chapter/10.1007/978-3-319-49849-2_4 [ Accessed on 28th August 2020].
Donzé, P. Y., and Wubs, B. 2019. Storytelling and the making of a global luxury fashion brand: Christian Dior. International Journal of Fashion Studies, 6(1), pp. 83-102.
Gaba, A. K. 2020. Unit-5 Market segmentation. Indira Gandhi National Open University: New Delhi.
Ji, H. 2016. Marketing plans for cosmetic industry in china: Case Study: Sephora.
Kostelijk, E., and Alsem, K. J. 2020. Brand Positioning: Connecting Marketing Strategy and Communications. Routledge.
Lagier, J., and Ranfagni, S. 2018. Luxury brand identity and heritage in transition in luxury capitals: the case of christian dior. In 2018 Global Marketing Conference at Tokyo, pp. 1512-1516.
Country Report. 2020. Luxury Goods in India-Analysis, 1-3. [Online]. Available at https://www.euromonitor.com/luxury-goods-in-india/report [Accessed on 28th August 2020]
Roux, E., Tafani, E., and Vigneron, F. 2017. Values associated with luxury brand consumption and the role of gender. Journal of Business Research, 71, pp. 102-113.
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