How the Current Recesion is affecting Luxury Brands and Goods.

In my International Business class we looked at LVMH. One of the questions asked was whether Luxury brands should price their products so high. Their were two general views. One was that LVMH markets its products to the affuluent and not to the aspiring customer. The other view was that they are excluding possible customers and that LVMH does want to appeal to the aspiring customer.

My opinion on the matter is that LVMH only wants a certain group of people wearing and using their products, because their bransd are so widely known that anyone that wears a Loius Vitton bag for example, is a walking advertisement for the company.

There is a commercial that I find rather funny. It shows the inside of a car, and the rest of the commercial, simply states how great the car is. At the end of the commercial this car company compares itself to Mercedes, BMW, and Lexus, and claims that its luxury car is better than the others cars that these presitgious autmoakers produce in its class. When the commercial ended the viewer discovers that mystery car is a Hyundai, and supposively it out classes the competiton in terms of quality and price. This is where I began to laugh. Hyundai claiming they put out better cars than Mercedes, is like Target saying their handbag is better than a Louis Vitton bag. Its simply isn't. Both products in both cases serve the same purpose, but the quality of brands differ greatly.

What do you think?

Would you buy the Hyundai if you could afford the Lexus, BMW, or Mercedes?
Do you think Hyundai is of the same quality of these luxury cars?
Do you think LVMH is justified with their high prices?
If you were and LVMH top level executive would lower , increase, or maintain the current prices of their products.?

How the Global Recession is Afftecting Businesses Trying to go Abraod

The current economic crisis in the U.S. has branched out to negatively affect the Global Economy. As it relates to businesses looking to go abroad how would this current economic crisis impact their decision to go abroad. And will it affect how they plan to go abroad (Greenfield investment, Franchising, Licensing, Joint Ventures, ect.)