Case study: Louis Vuitton $2,900 Smartwatch

Summary of Case

When Apple introduced the Apple Watch in 2015, it was unclear whether the company would revolutionize the watch industry as it did with MP3 players, cell phones, and tablet computers.  With recent Apple Watch unit sales second only to legendary watchmaker Rolex, that question has been answered.  Now fashion leader Louis Vuitton is asking a new question: Will consumers pay $2,900 for a smartwatch? In answering that question, shoppers will have to answer another: is this technology, or is it fashion?

Questions 

1. First, identify the level in Maslow’s Hierarchy of Needs into which the Tambour Horizon best fits. (see the attachment, must mention Maslow’s hierachy) Next, make a case for how it could fit into each of the other categories.

2. How could Louis Vuitton’s choice of distribution channel affect how shoppers perceive and evaluate the Tambour Horizon? If you were the marketer, what distribution channels would you use?

3. Consider the five types of perceived risk(see the attachment, must mentioned). How can each be at play in the purchase of a luxury smartwatch?

The learning outcomes associated with this assignment include application of the psychological and neurological foundations that influence consumer behavior, analyzing specific models of consumer behavior and purchase decision frameworks that inform marketing strategies and interpreting consumer segmentation, brand equity, loyalty, brand extendibility, brand personality and visualization in attracting consumers.