A Titan's Key to Success

The world's second richest person does not sell software, build computers, or launch social networks or rockets. Instead, he sells handbags.

Okay, maybe that's a bit of an understatement. He sells very high-end handbags and a variety of other designer goods. What isn't an understatement, though, is that he is only one of two members on Forbes' Top 10 billionaire list, who doesn't have technology at the heart of his business.

There is something that we can all learn from him.

His name is Bernard Arnault and he is the 74 year old Chairman and CEO of the luxury house, LVMH. LVMH is the conglomerate that owns Louis Vuitton, Christian Dior, Tiffany & Co., Givenchy, Sephora, Fendi, Marc Jacobs, Bulgari, Tag Heuer, Hublot, Fenty Beauty, and more. The LVMH empire also consists of wine and spirits brands like Dom Perignon, Hennessy, Belvedere and Moet & Chandon.

You don't hear Arnault's name much, unlike his billionaire peers such as Musk, Bezos, and Gates. Perhaps it's because he lives in France rather than the United States or because his rise has been a relatively slow burn. I believe it's mostly because he's tight-lipped. But the other night, when I walked down 5th Ave in Manhattan, I was reminded of this man's influence.

But what has allowed Arnault to amass this fortune? While there are ultra wealthy individuals out there who can afford to be regular customers of LVMH, they are far from the average person. LVMH products are clearly expensive, and in some cases, obscenely so. Very few people can spend thousands of dollars consistently on handbags.

The other companies representing the top billionaires on the Forbes list include Amazon, Tesla, Microsoft, and Meta. These are all largely much more commercially accessible, making it more realistic to swallow up massive market share.

Arnault's success comes down to one saying that a former boss used to tell me all the time, "Price is only an issue in the absence of value."

If Arnault can make it so that his customers can see more value in the product than they're paying for, then that makes it worth the purchase. Of course, many LVMH products themselves are not made of materials that justify the exorbitant price tag, but the brand name does. That's why Arnault has worked decades to create and sustain an aura of luxuriousness.

Arnault capitalizes on core human behavior and group dynamics. For people who hang in circles with other people who wear designer items, they too want to wear designer items. They want status or else they'll feel left out, a key driver in their spending habits. This has the same kind of effect as the other companies mentioned above.

Many of us feel left out if we can't access the convenience and cost effectiveness (and now the NFL games) of Amazon Prime. We feel left out if we don't have a Facebook or Instagram account to see what people are posting about. And, judging by the preorder waitlists, Tesla has the same effect too.

This is the same model that colleges across the country have used to rack up their tuition profits, while over 40 million Americans take on student loan debt.

We're now in the post-Black Friday gift giving season, where nearly everyone seems to be hyper-fixated on how much things cost, especially in this economy. But this is not the most important question that needs to be asked.

It misses the point that price is only an issue in the absence of value.

If it's a $300 gym membership, then does it allow us to substantially increase our wellbeing? If it's a $3,000 vacation, then does it create the memory or sentimental value that will last a lifetime? If it's a $30 million private jet, then does it make it that much easier to travel to business dealings worth many multiples more than that?

Let's think about how we can take Arnault's strategy of benefiting greatly through perceived value and flip it around to apply it to ourselves as sellers rather than buyers.

Each of us has a personal brand just like a company. The value of our personal brand outlasts what any one employer can offer us in the market because it's unique to us and can't be taken away. The more that we can do to create our own perceived value will only drive up the compensation that the market sends our way.

Yes, this takes confidence. But it can be done, and it can be the difference in our entire livelihood.

As Warren Buffet, the other non-tech oriented billionaire on the Forbes Top 10 list, once said, "If you aren't certain that you understand and can value your business far better than Mr. Market, you don't belong in the game."

It's time to get in the game and start leveraging our greatest asset in these tumultuous times...ourselves.