Gucci Performance Bottoms Up Confidence In Luxury Industry Doubled

Global

It is an indisputable fact that falling into recession is likely to record a second low growth rate since 2009.

However, in the first quarter, the growth of Gucci's counter trend increased the downturn in the luxury sector.

It is reported that Gucci grew by 3.1% in the first quarter, while the average growth rate in the same period was 1%.

Gucci's bottom rebound, which made the

Confidence doubled, and its CEO even threatened to grow two times faster than the industry's average growth rate in the future, aiming to sell 6 billion euros annually.

Compared with Gucci's big strides, competitors appear somewhat lonely, such as Louis Vuitton, Burberry, Dior, etc., instead of growth stagnation or negative growth.

And three years ago, Gucci was also satiried by the industry as "old design, no consumers, slow growth". Even in the first quarter of 2015, its performance was the worst in five years.

After the continued downturn, Gucci carried out self revolution, first of all, the high level of massive exchange of blood, and then the brand repositioning and returning to high-end positioning. In the Chinese market, it was a user anti-corruption policy and drew closer ties with China.

After repositioning, Gucci becomes younger, brighter, brighter and cleaner.

The more youthful design has won the young generation of the millennial generation and pulled back the old customers in the 80s and 90s of last century.

At the same time, in order to make Gucci return to the high-end line, Gucci reinstalled 34 stores last year, the target is reinstalled 50 this year, next year there are 40-50.

In addition to reloading stores, the shops in the low-end market have been abolished, and discount stores and price cutting trends have been reduced. Under various initiatives, Gucci is moving towards a revival step by step.

In the Chinese market, because of the anti-corruption high pressure, most luxury brands fall into recession, Gucci is no exception.

But Gucci is different. It is advocating China's anti-corruption policy, and believes that short-term negative effects will happen, but in the long run it is right.

The revival of Gucci will not be too easy and time consuming may exceed the market expectations. But the brand's initiatives are worth learning from other luxury goods companies, and luxury goods are likely to return to growth.

However, in the past few years, luxury goods industry has been in the depths of winter, luxury brands have been locked up to save themselves, and exposed problems in the development process.

The luxury industry is caught in the cold winter.

The size of the global luxury market has slowed down, and the growth of the most important Chinese market has begun to become sluggish.

According to the data released by the foresight Industry Research Institute, "2016-2021 years China's luxury industry market demand and investment forecast analysis report", sales of luxury goods in China increased by 30% in 2011, and fell rapidly in the following years, down to 7% in 2012 and only 2% in 2013.

The failure of luxury goods in the Chinese market is related to the domestic economic slowdown and the increase in anti-corruption efforts.

In addition, with the pformation and upgrading of consumption, consumers began to turn to low-key non famous brands, and the rise of outbound travel boom, domestic and foreign market spreads, product categories and other factors also affected the domestic luxury market.

To this end, luxury goods manufacturers began to comb the Chinese market and close down the loss stores.

According to incomplete statistics, according to incomplete statistics, in 2013~2015, BURBERRY closed 4 mainland stores, COACH closed 2, Armani 5 home, PRADA fell from 49 to 33, LV closed 3 last year.

Analysis of reasons for frustration and potential problems

The plight of the luxury sector is complicated.

One of them is the rise of overseas purchasing, which has many impact on China's luxury market.

With the rise of outbound travel, Chinese consumers have become more inclined to buy luxury goods in overseas markets.

There are differences between domestic and foreign products, such as price differentials, types, and so on.

Besides,

Misestimating the consumption potential of the two or three line cities.

When Chinese consumers are rising, many luxury brands are blindly optimistic, expanding in the two or three tier cities, overestimating the consumption power of the two or three tier cities, resulting in continuous loss of stores and having to close down.

Moreover, luxury goods companies do not know enough about the Chinese market, fail to grasp the habits of consumers, and make erroneous decisions frequently. For example, in order to deal with the impact of anti-corruption, they choose to "go logo", which not only failed to boost their performance, but also reduced their performance and damaged brand value.