LVMH is a global leader in the luxury goods industry formed through the merger of Louis Vuitton and Moet Hennessy in 1987. It has experienced strong growth through strategic acquisitions and expanding into new markets like China. In China, LVMH faces high competition but also opportunities for growth as disposable incomes rise. LVMH can focus on cost efficiency, organic growth through innovation, expanding distribution networks, and managing its portfolio of brands including star brands like Christian Dior and new brands. The future prospects in China include further tapping the growing middle class and exploring new opportunities in rural areas through advanced marketing strategies and long-term commitment to the China market.

1. Strategic Management Group Project President Group

4. Organizational Chart 2002

5. 2007 Financial Highlight by business group (EUR millions) Data source: LVMH2007 Annual Report Revenue by business group Profit from recurring operations by business group

6. Luxury Lifestyle in China

8. Why should I buy luxury goods?

9. 5 (+1) Forces Analysis of Luxury in China Threat of Substitutes Trends Impacting industry (Bargaining?) Power of Customers Bargaining Power of Suppiers Threat of New Entrants Rivalry among Existing Competitors

14. 5 (+1) Forces Analysis of Luxury in China Threat of Substitutes Trends Impacting industry (Bargaining?) Power of Customers Bargaining Power of Suppiers Threat of New Entrants Rivalry among Existing Competitors

16. LVMH Perfumes & Cosmetics Sustain a consistent brand positioning

18. 2007 Financial Highlight in LVMH Perfumes & Cosmetics revenue growth of 12% profit increase of 15%

19. Financial Highlights Comparison Data source: LVMH/ L'Oreal/ P&G 2007 Annual Report 15% 3,492 22,981 P&G Beauty Division (US millions) 21% 843.8 3,928 L'Oreal Luxury Products (EUR millions) 9% 256 2,731 LVMH Perfumes & Cosmetics (EUR millions) Operating margin (%) Operating Profit Sales

27. Creating a Star Brand Product Design Involves radical innovation --Artists must be completely unfettered by financial and commercial concerns, to do their best work. Manufacturing imposes strict discipline on its manufacturing processes. Through near-draconian manufacturing disciplines, the Company is able to achieve exceptionally high productivity. Star brand

28. If you are Chanel, your Perfumes’ package can be all the same Because this is Chanel!

29. But if you are not Chanel, you’d better change!

30. Luxury and Film