WSJ: Being LVMH's Bernard Arnault (MARCH 09)
Notes from the article:
- "When Arnault built LVMH into a multibrand luxury conglomerate during the 1990s, he could never have foreseen the economic downturn. But the strategy he embarked upon- betting that diversification among products and regions would allow one brand to sparkle when another slumps- may turn out to be invaluable."
- "Arnault's recipe has been consistent: hire designers who can draw attention and forge a brand identity, pour money into advertising and stores and buy back licenses lest they cheapen the brand."
- "One of Arnault's greatest strengths in creating some of the world's biggest brands has been to hire raw design talents like Galliano at Dior, Alexander McQueen at Givenchy, and Marc Jacobs at Louis Vuitton. He then gives them enough space to express their creative potential..."
- "Arnault balances the creative and commercial sides of his business, his public image and his role as the father of five children...with meticulous order and attention to detail."
- "The post-2001 downturn hit LVMH hard, almost wiping out the company's profits. Arnault responded by expanding the geographic reach of LVMH's key brands...The idea was to compensate for sluggish growth in the mature markets of Europe and the U.S. with the vibrant consumer-driven economies of China and India."
HBR: The Perfect Paradox of Star Brands: An Interview with Bernard Arnault of LVMH (October 01)
Notes from the interview:
- "If you think and act like a typical manager around creative people- with rules, policies, data on customer preferences, and so forth- you will quickly kill their talent."
- "The most successful creative people...want to see their creations in the street...They want people to wear their dresses, or spray their perfume, or carry the luggage they have designed."
- "The responsibility of the manager...becomes picking the right creative people..."
- "The important point is, you cannot compromise creativity at its birth...that does not mean that you shouldn't make suggestions during the creative process."
- "Our strategy is to trust the creators."
- "In any given year...only 15% of our business comes from the new; the rest comes from traditional, proven products- the classics."