The Elite Future of Luxury Brand Management

This article is sponsored by ESSEC Business School’s MBA in International Luxury Brand Management. Learn more about the program.

The world has changed. Since the global recession, many smaller brands have struggled. In 2015, the euro’s plummeting purchasing power continues to hurt continental consumers, while middle class shoppers in the US mainly used their energy savings to buy larger vehicles. Retailers found most shoppers remained stingy, with both Target and Walmart reporting only modest figures in November.

Yet, one market segment has not only endured but thrived: luxury. Since the recession, asset inflation has generally outpaced wages, with beneficiaries of real estate and stock market gains helping drive growth. Meanwhile, in China and other emerging markets there has been an explosion in the number of middle and high-income consumers.

Few countries are as synonymous with luxury goods as France. Home to iconic brands like Hermès, LVHM, and Chanel, it is also the location of ESSEC Business School, located just northwest of Paris. So, naturally, the school offers an MBA in International Luxury Brand Management, which celebrated its 20th anniversary in 2015.

ESSEC Business School’s luxury option

An MBA in International Luxury Brand Management remains as rarified as the market segment. In luxury, sought-after brands, by definition, lose their appeal if they became too easily (or cheaply) obtainable. With over 13,000 schools offering MBAs worldwide, the degree’s cachet faces similar challenges. Yet, applicants with a passion for the finer things in life might discover that specializing in luxury management is one way to add distinction to their degree.

The educational approach to luxury brand management necessarily differs from other specializations. For one thing, it doesn’t easily translate to an online curriculum; physically experiencing luxury goods and services is tremendously important. While high-end merchants often provide internet sales, for many consumers and managers nothing compares to the brick and mortar experience. Here ESSEC Business School’s location provides an unquestionable advantage. As ESSEC MBA student Jahnavi Tampi wrote in a blog post, “Where can you learn best about luxury but France?”

The specialization draws heavily on both its origins and its geographical advantage. Launched in 1995, ESSEC Business School’s MBA in International Luxury Brand Management was the first of its kind, initiated in collaboration between the school, LVMH and the L’Oréal Luxury Division. The goal? To recruit high-potential managers from other regions, particularly Asia. Once trained, MBAs would ideally return to their home countries and help run local luxury outlets.

In many ways, Tampi represents the new frontier. While previous luxury brand management classes had a large Chinese cohort, increasingly many are like Tampi and hail from the Indian subcontinent. A former fashion stylist for Elle magazine’s local edition, Tampi explains, “I have always felt an undying passion for the luxury industry. Being able to touch and feel the products and finally styling them together to create a fashion story that appeals to our Indian reader gave me a rush and I knew this was my calling.”

Those with similar callings and a passion for luxury have long gravitated toward ESSEC Business School’s MBA in Luxury Brand Management. Reputation and industry connections help make the program highly selective. Most of admitted students have between five and seven years professional experience. “50% of the people who come onboard and do the program do not come from a background in luxury,” explains Anthea Davis, the director of corporate relations and career development in an interview with ESSEC’s Campus Channel. “They come to the program to make a career switch.”

The school seeks applicants with an affinity for luxury. This is one reason the admissions interview is so significant. Four committee members, (two faculty, two from the ranks of ESSEC’s corporate partners) quiz applicants on their motivation, creativity and understanding of the sector. They need to know the segment’s key players and recognize how luxury is, as Davis points out, a unique blend of “attention to detail, history and heritage, craftsmanship and quality.”

Applicants don’t have to know specifically where they want to be at the end of the program, but they should have an idea of where they hope the degree will take them. Although the school wants to see ‘managerial capacity’, they are less concerned about an applicant’s undergraduate background.

Careers at Chanel and LVMH

Coveted and iconic, French luxury brands have legions of fans: both buyers and businesspeople. From Hermès’ Birkin bags to the Chanel suit to Louis Vuitton travel bags, reputation is constructed from equal portions of quality and rarity. Browsing for five-figure purses or watches may be a distant dream for many, but earning an executive position at a luxury purveyor is even more difficult then acquiring a Birkin.

Corporate partnerships and internship opportunities are familiar selling points for many MBA programs. Still, the lineage of ESSEC’s MBA in International Luxury Brand Management helps make the shift from student to employee nearly seamless. Besides Hermès, Chanel, and LVMH, corporate partners and sponsors include Burberry, Coach, Giorgio Armani and Mercedes Benz. Companies like L’Oréal and Firmenich have also provided scholarship funding.

An alumni network of nearly 600 graduates including many in executive positions provides further opportunities for graduates. As Davis explains in her Campus Chanel interview, during the program students can meet dozens of top level creative professionals. “You actually get to come face-to-face with the CEO of Chanel, with the CEO of Hermès. You would never get that kind of access outside of our program.” The specialization also includes a mentorship, in which an executive from the sector in which the student is most interested provides expertise and guidance.

The 11-month program in Luxury Brand Management is a conduit for the best and the brightest, who can boast a combination of taste and business acumen. In a 2014 interview with The Economist, ESSEC professor Simon Nyeck says students are challenged to combine financial discipline with a feel for the design world. In the beginning, the program mainly attracted creatives who wanted to incorporate business education into their CV. Today students are just as likely to come from the traditional financial world, with some 38% coming from academic disciplines like finance, accounting, economics or business.

Like other MBA programs, the MBA in International Luxury Brand Management begins with courses related to finance, career development, HR and the like. Yet even here they deviate from the norm by presenting case studies specific to the sector. From there, students can focus on fashion & accessories, fragrances & cosmetics, watches & jewelry, wine & spirits, cars & technology or hotels and real estate.

During the 11-month program, students spend at least one week working in a boutique. After all, as the program’s CV Book 2015 notes, “The luxury and prestige sector is one where retail is the ultimate battleground.” Field trips to destinations for luxury like Dubai, Hong Kong and Milan help round out the student’s understanding.

Future of luxury brand management

Although the luxury segment not only survived but thrived, today it faces new challenges. The weakened euro has attracted international shoppers – especially those from the United States which enjoys a strong currency. Although native shoppers may trim their purchases, in general the exchange rate benefits European based luxury brands.

The shift in China’s fortunes has had a more profound impact. The nation provided a steady stream of affluent shoppers, but recently their numbers have declined. One factor is the side effect of a state-run anti-corruption campaign. Fearful that displays of wealth or privilege will encourage accusations of corruption, top-level Chinese consumers have trimmed their purchases. An even greater impact has been felt as the country endures a bumpy shift from being a manufacturing economy to one driven by consumers. Yet, while the nation’s annual growth rate declines, another emerging economy is ascendant.

The Indian subcontinent has long been home to a growing legion of tech workers. Now those skills and other advantages are being leveraged as the country's growth surpasses China’s. Although the numbers of upper class consumers luxury brands desire doesn’t approach China’s, India’s contributions have mitigated the damage.

For the student of luxury, education provides a solid preparation which allows one to be alive to trends such as this. At ESSEC, Davis boasts that some 95% of those with an MBA in International Luxury Brand Management find positions within the luxury sector.

This article is sponsored by ESSEC Business School’s MBA in International Luxury Brand Management.