5 ms·

Important Advice for Creatives from the Richest Person in the World

18 points by vitabenes 4y ago

pavlov 4y ago
The title is horrible but the content is pretty decent. It's about how Bernard Arnault, CEO of LVMH Moët Hennessy Louis Vuitton, views his business. "Arnault praised Apple as an excellent product and brand, but he doesn’t consider it a luxury brand. Why? It lacks timelessness. And timelessness is a magical quality." I think Apple learned this point with the expensive flop of the first-generation Apple Watch Edition in 2015. They built the Apple Watch in gold-cased editions priced in the $10,000-15,000 range, set up show rooms in places like Dubai, and got a few celebrities like Beyoncé to wear one in pictures. Everything by the book for a luxury launch. But everyone knows that their Apple products need to be replaced every couple of years. A luxury watch needs to be something you could imagine passing to your grandchildren (even if you don't actually do that and just end up selling the watch some time later, as many buyers do). An Apple Watch just stops getting updates after four years and becomes electronics junk, gold alloy or not. In a rare misstep, the design and marketing departments at Apple were out of sync with the reality of their hardware product as part of a software-driven platform. In a similar vein, 25 years ago Nokia was at the top and tried to create a separate luxury brand Vertu for $10k phones: https://en.wikipedia.org/wiki/Vertu https://en.wikipedia.org/wiki/Vertu That didn't work out either because the devices were lacking the holistic combination of handcraft and creativity that Arnault would expect from a luxury product. They were simply ordinary Nokia phone guts in opulent metal cases. Vertu finally went bankrupt in 2017.
- bmitc 4y ago
  The primary push for the Apple Watch to be a luxury good came from Jony Ive.
- phphphphp 4y ago
  I don't agree with that assessment. Passing luxury goods down from generation to generation is not common. The issue is much more with the immediate value of the product: the average luxury bag is used maybe a few times, likewise the churn in the world of high-end sports car is very high. The problem is not that Apple Watch's aren't timeless, it's that they are so saturated that you can't turn them into a luxury good because there's no signal associated with them. If I see a person wearing an Apple Watch I have no idea how much it's worth, it says nothing to me other than they have an Apple Watch. If I see someone driving a Ferrari, I know immediately that it's high value. That's why you'll see people buy old barely functional luxury goods (like mid 2000s Lamborghinis which barely work any more) because most people don't realise they're dirt cheap now, and so the cost to signal ratio is very high. Look at Maseratis: awful garbage cars in most cases, but because they look nice, lots of people trying to signal wealth and success will buy them for cheap, despite an almost guarantee they'll be worthless.
  - matwood 4y ago
    I agree with your point, but even items like an Apple Watch or iPhone have some signal, just much less than something like a Ferrari. Signal also differs based the group the person is in. I know many on HN think they are immune, but still buy the 100 core latest CPU and talk about it online for example. Finally, LVMH may be critical of Apple in this article, but they would love to be in their position. Apple has mastered the art of selling things with Toyota volumes and Ferrari margins.
canadianfella 4y ago
[dead]
jeswin 4y ago
The actual reason why he's the richest person in the world: LVMH has mastered how to appeal to vanity. If you look at their catalogue, the only thing that stands out is the price.
- sudhirj 4y ago
  This is a bit reductionist. The price stands on a foundation of quality. You can build something excellent and charge 100x what it took to make it, but you can't do that with shitty product.
- pavlov 4y ago
  On the other hand, LVMH doesn't lie to you about their products. The handbag is a handbag. The bottle of champagne is a bottle of champagne. They tell you in great detail how it's made, where and by whom, and if you think it's worth it, you can buy it for the asking price. It makes for an interesting contrast with the previous holder of the title of world's richest man, Elon Musk. I'm an occasional customer of both Tesla and LVMH. The rare times I've bought a bottle of Krug or Dom Pérignon, it has never let me down. The product was exactly what they promised. But with Tesla, my prevailing mood is a lingering disappointment that I was stupid enough to pay $7500 for a "Full Self Driving" package which four years later still doesn't do anything. I know Musk has lots of fans, but eventually lies will catch up to you. Arnault doesn't have this problem.
- WastingMyTime89 4y ago
  No, LVMH has mastered the subtle art of tight rope walking that is the modern luxury industry. The trick is to be a mass market company while keeping the margins of a luxury company and preserving your image as a luxury company. If you look at the Vuitton catalogue, you will indeed see products which would definitely be seen as luxury goods: the best Italian leathers, costly assembly techniques, products painstakingly handcrafted in places known for their mastery of the craft. All of these a pretty decor to sell perfumes with global appeal (read uninteresting) and overpriced handbags.
RcouF1uZ4gsC 4y ago
> Bernard Arnault, in the Oxford Union Society interview, went on the state that his businesses strive for quality, creativity, and innovation in their products. They give their artisans and creators the freedom to design and create things. > “We don’t do marketing,” Arnault told his interviewer. If you believe this interview, I have a bridge (or a new cryptocurrency) to sell you.
- sudhirj 4y ago
  He explains that they do marketing later on the interview, and how they do it. A better way to explain this would be that his brands are not marketing-driven. They do marketing only after projects achieve product-market-fit.
  - butler14 4y ago
    Establishing product-market-fit is part of marketing. I think you're confusing marketing and advertising.
    - sudhirj 4y ago
      Yeah, he's using the words interchangeably in the interview. Talking a lot about "marketing" with Facebook ads.
  - dnh44 4y ago
    I believe the OP is implying that the interview itself is marketing. By claiming the brand brand is not driven by marketing the unstated message is that brand is successful due to quality and innovation. The interview itself is a fantastic bit of marketing if you think about it.
- JBiserkov 4y ago
  A cryptocurrency bridge!
galgot 4y ago
Ahhh Bernard... He once tried to became a Belgian subject to pay less taxes. And now that he is the richest in the world mainly due to Elon goofing (the guy selling self-parking rockets services), he gives advises... but do "no marketing". Vanitas vanitatum Omnia vanitas... Want good laughs ? Watch this film : https://www.youtube.com/watch?v=9V03eMAjQgA https://www.youtube.com/watch?v=9V03eMAjQgA
fuzzfactor 4y ago
>Louis Vuitton, a brand that was founded in Paris, France in 1854 People can all be quite confident the luxury market was very well catered to quite a number of centuries before this.

18 points by vitabenes 4y ago

The title is horrible but the content is pretty decent. It's about how Bernard Arnault, CEO of LVMH Moët Hennessy Louis Vuitton, views his business. "Arnault praised Apple as an excellent product and brand, but he doesn’t consider it a luxury brand. Why? It lacks timelessness. And timelessness is a magical quality." I think Apple learned this point with the expensive flop of the first-generation Apple Watch Edition in 2015. They built the Apple Watch in gold-cased editions priced in the $10,000-15,000 range, set up show rooms in places like Dubai, and got a few celebrities like Beyoncé to wear one in pictures. Everything by the book for a luxury launch. But everyone knows that their Apple products need to be replaced every couple of years. A luxury watch needs to be something you could imagine passing to your grandchildren (even if you don't actually do that and just end up selling the watch some time later, as many buyers do). An Apple Watch just stops getting updates after four years and becomes electronics junk, gold alloy or not. In a rare misstep, the design and marketing departments at Apple were out of sync with the reality of their hardware product as part of a software-driven platform. In a similar vein, 25 years ago Nokia was at the top and tried to create a separate luxury brand Vertu for $10k phones: https://en.wikipedia.org/wiki/Vertu https://en.wikipedia.org/wiki/Vertu That didn't work out either because the devices were lacking the holistic combination of handcraft and creativity that Arnault would expect from a luxury product. They were simply ordinary Nokia phone guts in opulent metal cases. Vertu finally went bankrupt in 2017.

bmitc 4y ago
The primary push for the Apple Watch to be a luxury good came from Jony Ive.
phphphphp 4y ago
I don't agree with that assessment. Passing luxury goods down from generation to generation is not common. The issue is much more with the immediate value of the product: the average luxury bag is used maybe a few times, likewise the churn in the world of high-end sports car is very high. The problem is not that Apple Watch's aren't timeless, it's that they are so saturated that you can't turn them into a luxury good because there's no signal associated with them. If I see a person wearing an Apple Watch I have no idea how much it's worth, it says nothing to me other than they have an Apple Watch. If I see someone driving a Ferrari, I know immediately that it's high value. That's why you'll see people buy old barely functional luxury goods (like mid 2000s Lamborghinis which barely work any more) because most people don't realise they're dirt cheap now, and so the cost to signal ratio is very high. Look at Maseratis: awful garbage cars in most cases, but because they look nice, lots of people trying to signal wealth and success will buy them for cheap, despite an almost guarantee they'll be worthless.
- matwood 4y ago
  I agree with your point, but even items like an Apple Watch or iPhone have some signal, just much less than something like a Ferrari. Signal also differs based the group the person is in. I know many on HN think they are immune, but still buy the 100 core latest CPU and talk about it online for example. Finally, LVMH may be critical of Apple in this article, but they would love to be in their position. Apple has mastered the art of selling things with Toyota volumes and Ferrari margins.

canadianfella 4y ago

[dead]

jeswin 4y ago

The actual reason why he's the richest person in the world: LVMH has mastered how to appeal to vanity. If you look at their catalogue, the only thing that stands out is the price.

sudhirj 4y ago
This is a bit reductionist. The price stands on a foundation of quality. You can build something excellent and charge 100x what it took to make it, but you can't do that with shitty product.
pavlov 4y ago
On the other hand, LVMH doesn't lie to you about their products. The handbag is a handbag. The bottle of champagne is a bottle of champagne. They tell you in great detail how it's made, where and by whom, and if you think it's worth it, you can buy it for the asking price. It makes for an interesting contrast with the previous holder of the title of world's richest man, Elon Musk. I'm an occasional customer of both Tesla and LVMH. The rare times I've bought a bottle of Krug or Dom Pérignon, it has never let me down. The product was exactly what they promised. But with Tesla, my prevailing mood is a lingering disappointment that I was stupid enough to pay $7500 for a "Full Self Driving" package which four years later still doesn't do anything. I know Musk has lots of fans, but eventually lies will catch up to you. Arnault doesn't have this problem.
WastingMyTime89 4y ago
No, LVMH has mastered the subtle art of tight rope walking that is the modern luxury industry. The trick is to be a mass market company while keeping the margins of a luxury company and preserving your image as a luxury company. If you look at the Vuitton catalogue, you will indeed see products which would definitely be seen as luxury goods: the best Italian leathers, costly assembly techniques, products painstakingly handcrafted in places known for their mastery of the craft. All of these a pretty decor to sell perfumes with global appeal (read uninteresting) and overpriced handbags.

RcouF1uZ4gsC 4y ago

> Bernard Arnault, in the Oxford Union Society interview, went on the state that his businesses strive for quality, creativity, and innovation in their products. They give their artisans and creators the freedom to design and create things. > “We don’t do marketing,” Arnault told his interviewer. If you believe this interview, I have a bridge (or a new cryptocurrency) to sell you.

sudhirj 4y ago
He explains that they do marketing later on the interview, and how they do it. A better way to explain this would be that his brands are not marketing-driven. They do marketing only after projects achieve product-market-fit.
- butler14 4y ago
  Establishing product-market-fit is part of marketing. I think you're confusing marketing and advertising.
  - sudhirj 4y ago
    Yeah, he's using the words interchangeably in the interview. Talking a lot about "marketing" with Facebook ads.
- dnh44 4y ago
  I believe the OP is implying that the interview itself is marketing. By claiming the brand brand is not driven by marketing the unstated message is that brand is successful due to quality and innovation. The interview itself is a fantastic bit of marketing if you think about it.
JBiserkov 4y ago
A cryptocurrency bridge!

galgot 4y ago

Ahhh Bernard... He once tried to became a Belgian subject to pay less taxes. And now that he is the richest in the world mainly due to Elon goofing (the guy selling self-parking rockets services), he gives advises... but do "no marketing". Vanitas vanitatum Omnia vanitas... Want good laughs ? Watch this film : https://www.youtube.com/watch?v=9V03eMAjQgA https://www.youtube.com/watch?v=9V03eMAjQgA

fuzzfactor 4y ago

>Louis Vuitton, a brand that was founded in Paris, France in 1854 People can all be quite confident the luxury market was very well catered to quite a number of centuries before this.