Overview
Bachelor’s thesis on how controlled scarcity and craftsmanship work together as a competitive strategy in luxury, using Hermès as the reference case and testing whether the same logic applies to other industries.
The thesis was written for the Management course at LUISS Guido Carli University, under the supervision of Prof. Luca Pirolo.
The original thesis is written in Italian. An executive summary in English is available below.
Key Tasks
- Built the theoretical framework: luxury positioning, natural vs controlled scarcity, craftsmanship as a rare asset, symbolic value and status
- Reconstructed Hermès’ strategy across four levers: artisanal production, purchase ritual, control of channels and prices, long-term governance
- Analysed the group’s financial performance over 2015-2024 against LVMH and Kering
- Compared controlled scarcity across streetwear, automotive, consumer tech and watchmaking
- Assessed the limits and risks of scarcity strategies
Core Insights
Scarcity is institutional, not accidental: at Hermès it is governed across the whole value chain, from one-artisan production to wishlist-based access
It pays: 2024 revenue of €15.2bn and a 40.5% operating margin, almost double LVMH and Kering
Craftsmanship scales by replication: new artisans and workshops, accepting a natural ceiling on volumes
The logic travels, with different durability: permanent in luxury and watchmaking, relational at Ferrari, episodic in streetwear, cyclical in tech
It has limits: scarcity fatigue, customer frustration and loss of exclusivity when brands expand, as in the Supreme case