Melwani says that to grow its customer base and foster cultural relevance, LVMH looks for shared moments of culture. “If you take a step back, these things” — he holds up his smartphone — “are ruining society. We know that that’s a pretty established fact, at this point. One of the reasons it’s problematic is because what each of us watch on these devices is almost totally different from each other. So therefore it’s very, very hard to build cultural desirability through this,” he explains. “We need shared points of culture in order to build cultural relevance and therefore long-term desirability — that’s the business that we’re in — so Formula One is one of the remaining places for shared culture and [the fact that] younger women are coming into the sport, that’s a key part of it.”
LVMH has begun approaching moments like this at a group level, breaking with tradition to promote individual brands. This strategy was prominent during the Paris Olympics — in addition to opening ceremony suits from Berluti, Chaumet-designed medals, athletes dressed in Dior and Louis Vuitton, and Moët Hennessy-stocked events — LVMH itself hosted a hospitality townhouse on Rue du Faubourg Saint-Honoré.
Formula One is building on this template, creating efficiencies in terms of shared event venues, guest lists and experiences. On the Thursday leading into the race weekend, Tag Heuer hosted a private party at its new Austin store, which opened in June, with sales that surpassed expectations. The F1 partnership is working especially well for the luxury watchmaker, Melwani says. (Tag Heuer’s F1 relationship goes back to a Ferrari sponsorship in 1971.) At the track, Tag Heuer collectors joined Louis Vuitton clients in private track-side “photo safaris” and paddock tours, cooling off and dining together in the shared suite.
LVMH plans to build on this approach with subsequent races. The Austin race was just extended through 2034, and there are 24 races a year. Unlike with the Olympics, LVMH has 10 years to finesse its approach. “Whenever we see something that is expanding the tent that can be accessed, that’s interesting to us,” Melwani says.
Made in the USA, in Texas
The crowd in Austin reached 450,000, and it’s one of the best-attended F1 events. But Texas is important to LVMH beyond F1. Texas’s business-friendly climate and lower taxes now attract those including Apple, Tesla and Charles Schwab. LVMH has about 100 boutiques across the state, having opened 10 new retail locations in the past year. Dallas’s Dior boutique was one of only two locations to open a Dominique Crenn-led restaurant (the other is in Beverly Hills), and Houston is the homebase of a joint venture between Beyoncé and SirDavis whisky. LVMH also has a distribution center and a client service center in Texas.
#LVMH #Bigger #Texas
