Elie Saab: From Haute Couture to Affordable Luxury Market - Case Study Example

Based on SWOT analysis, the strengths of Elie Saab are the following: 1) high brand equity because it is a member of the prestigious Chambre Syndicale de la Haute Couture and because famous celebrities and royalties have worn its designs; 2) direct ownership of many of its stores or branches all over the world, which improves its ability to collect and learn from local knowledge and to swiftly respond to changing local tastes; 3) it has a portfolio (clothing, shoes, bags, and accessories) that caters to the basic dress and apparel needs of its high-end market, and 4) horizontal diversification to yachts, hotels, and others can reduce risks of exposure to short-cycle sales in the haute couture business.

The company’s weaknesses are the following: 1) poor presence in multi-brand shops; 2) poor sales in Asia, United States, and Russia; 3) limited market because of the small number of high-end consumers, and 4) problem of haute couture brand dilution because of horizontal diversification (Shuayto). The threats to the company are: 1) increasing trend toward more affordable luxury brands (i.e. Hermes brand being more and more in demand than Louis Vuitton; 2) trend toward dressing casual or semi-casual for evening occasions among the rich and famous; 3) a growing number of new billionaires and millionaires are coming from Asia, and yet Elie Saab is not immensely popular in this continent, 4) steep competition among high-end luxury brands (Hines and Bruce), and 5) high production costs.

The opportunities for Elie Saab are: 1) increasing demand for affordable luxury products and 2) marketing in Asia where many new individual billionaires and millionaires are located (Shuayto). The primary competitive advantages of Elie Saab are: 1) it has a popular brand in the Middle East that can carry over to Asia, 2) it has resources that can allow it to expand offerings for the affordable luxury market, and 3) it has expertise in personalizing products and service (Stankeviciute 244). As for its product life cycle, Elie Saab is in the maturity stage of the haute couture product life cycle.

First, it has many competitors already, such as Chanel, Christian Dior, Valentino, and Jean Paul Gautier, among others. Second, Elie Saab has a full product line too, meaning it already makes clothing, shoes, bags, and accessories (Shuayto). Third, the price concern of the company is to defend its market share through competitive pricing (Oh 151). Fourth, the promotions of the company are more oriented to reminding customers of its existence, rather than aggressively promoting to capture a new market (Hines and Bruce).

Fifth, it has maximized outlets in its existing countries because not all locations are lucrative spots for haute couture. In addition, the company’s positioning and differentiation strategy changed over time by focusing first on haute couture exclusively and then shifting to ready-to-wear evening gowns. Differentiation shifted from haute couture exclusivity to inclusion of more affordable and easier to make ready-to-wear designs. This essay suggests that Elie Saab should target an additional market, especially the affordable luxury market, because it is a highly-expanding market due to the rise of new rich individuals and families in Asia, Russia, and South America (Oh