Luxury goods : selling a dream

• Olivier BOMSEL
  Directeur adjoint du CERNA - École des mines de Paris
  
• Alain BUCAILLE
  Directeur général d'Hermès International
  
• Didier GRUMBACH
  Président-directeur général de Thierry Mugler
  

Summary

The luxury goods industry in France has a turnover of one hundred and five billion Francs and employs as many people as the entire aeronautical industry. Managers of the luxury goods companies say that they earn money by "selling a dream". According to Olivier Bomsel, the luxury industry is effectively based on representations associated with an object bearing a particular brand name which significantly increases the customer's "willingness to pay". In the opinion of Alain Bucaille, luxury goods enable the individual to indulge himself in the richness of the sensations which they bring. As far as this is concerned; there is no price limit either for the manufacturer, who aims for perfection which he himself sets, regardless of cost, or for the customer who is fascinated by this perfection. Didier Grumbach describes the difficulties faced by the large fashion houses with the emergence of prêt-à-porter (ready to wear) clothes. The luxury business must meet the challenges of a massive production, ie. the management of rare goods with controls on their distribution.

Summary translated from French by Rachel MARLIN.

• The entire article was written by Élisabeth BOURGUINAT.

To obtain this article, you can :

• download it for free in French (PDF help) or contact ecopar@paris.ensmp.fr (Reference IN230398).

The entire article appears in French in the Journal de l'École de Paris du management N° 13.