Handbag wars - how Hermès won the Luxury Showdown against Louis Vuitton

What do Hermès and Louis Vuitton have in common?

They’re both at the pinnacle of the luxury industry, with iconic products and loyal followings.

But when times get tough, their differences come into sharp focus.

While Louis Vuitton is grappling with slowing sales, Hermès is flourishing with double-digit growth.

• Hermès: Achieved an 11% sales growth in the third quarter of 2024, reaching €3.7 billion in revenue.
• Louis Vuitton (LVMH Fashion & Leather Goods Division): Reported a 5% decline in sales during the same period.

It’s not luck. It’s not timing. It’s strategy.

Hermès has built a fortress of exclusivity and resilience.

Louis Vuitton, though still a powerhouse, struggles with a more accessible approach that makes it vulnerable during economic downturns.

The good news?

The lessons that separate these two giants are not confined to luxury fashion.

Whether you’re running a small business, a side hustle, or a growing brand, you can learn from Hermès’ approach to create a business that thrives in any market.

Here’s how.

1. Scarcity Breeds Desire: The Power of “Not Everyone Can Have It”

Hermès limits production intentionally. Ever heard of the Birkin waitlist? It’s not just about demand—it’s about creating desire through scarcity. Hermès knows that the less accessible something is, the more people want it.

How You Can Apply This:

• Don’t try to serve everyone. Instead, focus on a niche audience and create products or services that feel exclusive.
• For example, if you’re a coach, limit the number of clients you take on and position it as an exclusive opportunity.
• If you’re selling physical products, create limited-edition runs. Make people feel like they’re part of a special club.

2. Quality Over Quantity: Build an “Investment-Worthy” Product

Hermès products are synonymous with craftsmanship and longevity. Their customers don’t just buy a bag; they buy a legacy piece, often passed down through generations.

Louis Vuitton, while still high quality, produces at a much higher volume. This opens the door to dilution of the brand’s perceived value.

How You Can Apply This:

• Invest in quality, even if it costs more upfront. If your product or service delivers lasting value, people will pay a premium.
• For example, if you’re in e-commerce, focus on durable, high-quality materials instead of chasing cheap trends.
• Build trust with your customers by offering warranties or guarantees, reinforcing the idea that your offering is built to last.

3. Create Emotional Experiences, Not Just Transactions

Hermès isn’t just selling handbags; it’s selling a story, a lifestyle, a dream. The brand evokes emotions of exclusivity, pride, and timeless elegance.

In contrast, Louis Vuitton has leaned into becoming a mainstream luxury brand, which means it risks becoming transactional rather than aspirational.

How You Can Apply This:

• Tell stories around your brand. What inspired your business? What values do you stand for?
• For example, if you’re a local bakery, share the story behind your recipes or the farmers who supply your ingredients.
• Design every customer interaction—your website, packaging, and emails—to make people feel something positive about your brand.

4. Build Loyalty by Overdelivering

Hermès customers aren’t just buyers; they’re brand ambassadors. The exclusivity of owning an Hermès item fosters immense loyalty. When customers finally “get in,” they feel valued and part of something special.

Louis Vuitton, with its wider accessibility, doesn’t offer the same sense of exclusivity or personal connection, which can erode loyalty over time.

How You Can Apply This:

• Make every customer feel special, even if you’re running a small operation.
• For example, send handwritten thank-you notes or surprise loyal customers with unexpected perks.
• If you run a service-based business, go the extra mile with personalized touches—remember birthdays, preferences, or special requests.

5. Stay True to Your Identity: Don’t Chase Every Trend

Hermès stays rooted in timeless luxury. It doesn’t try to appeal to every generation with flashy campaigns or overly trendy designs. This consistency strengthens its identity.

Louis Vuitton, on the other hand, frequently experiments with trends to attract a younger audience. While this may boost short-term sales, it risks diluting the brand’s core identity.

How You Can Apply This:

• Define your brand’s core values and stick to them. Don’t chase trends if they don’t align with your identity.
• For example, if you’re a fitness coach specializing in holistic wellness, don’t suddenly pivot to extreme fad diets just because they’re popular.
• Consistency builds trust. Stay true to what makes your business unique, and your audience will appreciate it.

What This Means for Your Business

The lesson is simple: be Hermès, not Louis Vuitton.

You don’t have to be the biggest player in your market. You just need to be the most desirable.

By focusing on exclusivity, quality, emotional connection, loyalty, and authenticity, you can build a brand that not only survives tough times but thrives in them.

Practical Steps to Start Today

1. Audit Your Brand: Ask yourself, “What makes my business special?” If the answer isn’t clear, it’s time to refine your focus.
2. Create a Signature Offering: Develop one product or service that stands out as your “Hermès Birkin”—something so valuable and desirable that people will wait for it.
3. Add a Personal Touch: Start small. Send thank-you notes, offer surprises, or host an exclusive event for your top customers.
4. Simplify Your Messaging: Cut out the noise. Speak directly to your audience about what matters to them.
5. Commit to Quality: Whether it’s your product, service, or customer experience, aim to overdeliver every time.

Here's how Jungle Juice applied these practical steps to stand out and succeed:

1. Audit Your Brand:

We identified what made Jungle Juice unique: its ability to identify trending products on social media using cutting-edge AI and blend organic and paid traffic methods to drive sales.

By focusing on this niche, we refined our message to clearly articulate how we solve a specific problem for e-commerce entrepreneurs.

2. Create a Signature Offering:

Our “signature offering” became the Jungle Juice Software, a one-of-a-kind tool that helps users discover trending products before they saturate the market.

This was marketed as a must-have for entrepreneurs, creating demand and exclusivity by positioning it as a game-changer in the dropshipping world.

3. Add a Personal Touch:

We went beyond standard customer interactions by hosting live Q&A sessions and offering tailored coaching for top-tier users.

Clients also received personal follow-ups to ensure they were maximizing the software's potential, fostering loyalty and a sense of being valued.

4. Simplify Your Messaging:

We cut through industry jargon and directly addressed our audience’s pain points.

Messaging focused on one simple promise: "Jungle Juice helps you find trending products before your competitors do."

This clarity resonated with our target market.

5. Commit to Quality:

The software was developed with user-friendly features and top-notch AI to ensure reliability and results.

We overdelivered by offering extra resources, like TikTok Live tutorials, SEO strategies, and case studies, to help users succeed beyond just using the tool.

By applying these principles, Jungle Juice positioned itself as an indispensable ally for entrepreneurs, much like Hermès’ coveted exclusivity in the luxury space.

Summary: Stand Out by Being Exceptional

Hermès isn’t just thriving by chance—it’s thriving because it refuses to be ordinary.

Your business can do the same.

By learning from these luxury titans, we can craft a brand that people admire, trust, and are willing to invest in—whether we're selling handbags, services, or digital products.

The key is to focus on creating desire, delivering value, and staying true to who you are.