iation in trank making: the first trunk to have a flat top when Apple introduced the Apple Watch in 2015, i was ored Now fashion leader Louis Vuiton is asking a plary as i did with MP3 players, cell phones, and tab At computers With recent Apple Watch unit sales second ly legendary watchmaker Rolex, that question has been ew questioa Will consumers pay $2.90O for a smartwatch? In answering that question, shoppers will have to answer Mosieur Mardchal. After only four years, Vuinon created an Los apprenticed making trunks under master trunk maker Chaptar . Muvaton and Aect 175 CASE STUDY The Louis Vuitton $2900 Smartwatch-High Tech or High Fashion? It's All in the Eye of the Beholder whether the company would revolutionize the watch Noice mything these apps have in common? All relate k truvel, appropriate for the jet seners who carry Louis Viuit- ton luggage as they move anong world-class cities. Et t's the fom, not the fanction, that Lis Vuiton bopes will distinguish is entry in the marken. A 24-bour engraved bezel is encased under a saphire crystal, but the face of the watch is what you make it. Choose one of the famous Vuimon looks such an Monogran, Damier, or colored stripes, or use your own initials-the ultimate bespoke model.0 Wearen can customize the look further with one of 60 interchangeable straps, which diey can casily change with a patented system made from a carbon-enriched composite material.1010 How will potential customers evaluate the Horizon Tambour? What process will they use to decide whether it is worth the $2.900 that Louis Vuitton is asking? As both a technology and a fushion product, the Horizon fits into the category known as a hybrid wearable, and as a higher end offering, a lurury hybrid. This is important to consider because it reveals the identity problem products like this face. Louis Vuitton's original line of watches was clearly all ubout fashionthey reliably tell time, but were mostly about the look, the image, and reputation attached to the brand. While many shoppers will focus on that fashion aspect, some will Jean toward the tech functionality, and others will care deeply about both. What's 'a marketer to do? Il is largely up to marketers to "self-identify" their prod- ucts as being in one category or another through their pro- motionul communications. We can see a strong clue to Louis Vuitton's choice in the advertising the company created to launch the product. For its teaser advertising on Instagram, a video showed close-ups of the faces of different people in the center of the Tambour Horizon bezel. Each of the actors proclaims, "Don't take time. Let it take you."104.105 The videos said nothing about features, apps, or battery life. Although the company's website provides summaries of the key applications, its print communications are typical fashion advertising that focus on a glamorous model who wears the product. Further., the company does not even emphasize that the watch is Android compatible.106 But what about that price? Luxury watchmakers have commanded high prices for their products for many years, in part because of the products' heirloom value. One of the priciest. Patek Phillippe, has for over twenty years told us that, "You never actually own a Patek Phillippe. You merely look after it for the next generation,"0 But given the pace er is this technology, or is it fashion? Vuitton began its fashion dynasty when its name- e started bis luggage business in Paris in 1854, where tiom. It was a hit and by the 1860s, in Paris he opened orld's largest store for travel items. His fame spread, y ae to a "celebrity endorsement" from Empress Eug- he wife of Napoleon IlI. Soon, his client list included less than financier JP. Morgan, artist Henri Matisse, Rothschild banking family, and the Duke and Duch- Windsor" One hundred years later, the product line uramded to wonen's handbags. Today, the Louis Vuitton n be found on everything from denim jackets (S4,050). backpacks (S2,040), to t-shirts (yours for only $505, The company added traditional mechanical watches to y product line in 2002. branding it as the Tambour col- estion (Tambour is French for "drum," referring to the mel-drum or case that houses the mainspring). But the Conpany was late to the party with its entry into the product catogory of computer "wearables" devices embedded in Apparel and fushion accessories.* Other famous designers och as Michael Kors, Rebecca Minkoff, and Kate Spade had already jumped into the luxury smartwatch market." So, the Tambour Horizon smartwatch needed something ipecial to stand out. Some fashion observers believe the company delivered. 6 The Tambour Horizon is built on Google's Android tech- cology, and it includes many features standard to the cat- rgory such as email and text alerts, and step counting." It alho includes apps Google created especially for Louis Vuit- Dn A built-in City Guide provides information on the best ddresses and sites to see in seven of the world's most vis- And cities based on Vuitton's well-known travel guidebooks. A grolocation capability alerts you to tourist attractions, spots, and restaurants in your vicinity. With the GMT ktion, you display the name of a city on the screen and the Comesponding local time appears." of change in computer technology, this old school logic may not work for smartwatch buyers. 108 Next, make a case for how it could fit into each of bour Horizon badly enough to shell out $2,900 to meet those 176 Section 2. Internal Influences on Consumer Behavior either the front or back of the minds of consumers, they wit have to decide whether they want the Louis Vuitton Ta As with most luxury items, shoppers will be drawn to these high priced products because they shout exclusivity, prestige, and uniqueness, It's interesting to note what this smartwatch does not have: A heartbeat monitor, preventing wearers from capturing their increased heart rate as friends look at them with envy! And the product's relatively short list of functions may be a good thing. A recent study found that products such as these luxury smartwatches should not have too many features, lest wearers no longer consider them unique."09 Do you recall the difference between needs and wants? Smart watches satisfy a long list of contemporary functional needs: Immediate communication, health tracking, mobile payments, alerts, and yes, they also tell time. The luxury ver- sion also meets the needs of status, self-expression, and the desire to be a part needs. As we saw in the chapter, motivation is everything DISCUSSION QUESTIONS CS 5-1 First, identify the level in Maslow's Hierarechy o Needs into which the Tambour Horizon best r. the other categories. CS 5-2 How could Louis Vuitton's choice of distribution channel affect how shoppers perceive and evaluate the Tambour Horizon? CS 5-3 Consider the five types of perceived risk. Which ones might be at play in the purchase of a luxury smartwatch of an "in" group. With those priorities in