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    The Strong Growth Of Marco Bizzarri:Gucci Will Last Forever.

    2018/10/24 10:07:00 48

    GucciSalesElectricity ProvidersLuxury Goods

    Imran Amed and Marco Bizzarri talk about the summit meeting held in Shanghai fashion week.


    Marco Bizzarri, President and chief executive of Gucci, talked about future growth, leaked internal videos, and Chinese business ecosystem that continues to beset him.

    Shanghai, China -- the strong growth of Gucci will last forever, at least, the president and chief executive of the Italy luxury giant said.

    In the 2017 year, Gucci's sales exceeded 6 billion euros for the first time, up 45% compared with last year.

    Sales in the first half of this year increased by 44% over the same period last year.

    Marco Bizzarri spoke in a half - joking speech at the BoF summit in Shanghai last week.

    He also talked publicly about a previously leaked video of the company.

    In the video, he comforted his employees on the inevitable slowdown of Gucci.

    Bizzarri said that employees thought Gucci will face more difficult times, but his intention is just the opposite, so that everyone can rest assured.

    After enjoying a long period of prosperity, slower growth is inevitable, because the base of growth has become larger, but this should not be a cause for concern.

    "Our business has doubled in three years, so of course there will be a slowdown in store growth," he said. "But frankly, I am not worried."

    In his frank interview with BoF founder and chief executive, Imran Amed, including China in his critical comments on China's major e-commerce platforms,

    Fashion industry

    The main participants are on the scene, including from

    Alibaba Tmall

    And other executives of technology giants that drive the development of e-commerce in China.

    The data from McKinsey Global Institute show a number worth remembering: the 42% global business pactions in China happen in China.

    "Listen, sooner or later, we must cooperate with these platforms.

    (but) at present, we are in a wait-and-see state, "Bizzarri said.

    "Frankly speaking, there are a lot of fake goods on the platform of most Chinese electric suppliers. I don't want to authenticated fake goods, because we are on these platforms."

    Bizzarri quickly explained that he had an opinion about fake goods not because they would affect the income of Gucci, but related to the conditions of producing fake and inferior products (usually produced by cheap and unsupervised labour), and he was unwilling to support it.

    Gucci and its parent company Kering have been working with China for many years.

    E-commerce platform

    Maintain a conflict relationship.

    In 2014 and 2015, Kai Yun filed a lawsuit against Alibaba, the leader of e-commerce in China, on the grounds that the counterfeit goods on its website were rampant.

    Last year, in a major public relations victory in Alibaba, he gave up the lawsuit and agreed to work with the Chinese giant to set up a special task force to share information and protect the brand of Kai Yun.

    While the conflict is easing, Alibaba is also trying to attract more luxury brands and a larger share of Chinese luxury consumers. Alibaba has opened a special luxury store for its invited brands and customers in its existing e-commerce applications.

    According to Bain Bain & amp; Co., China's luxury consumers account for 32% of global luxury consumption.

    Since its establishment more than a year ago, Gucci has formed a partnership with more than 60 luxury brands, but if Bizzarri insists on its attitude, it seems unlikely that Gucci will become the next Alibaba's brand partner, although it means that it will miss 600 million of China's precious big data resources promised by the Alibaba to its luxury partners.

    "I do not think that pioneers will create competitive advantages for us.

    So in this case, I will not risk, I will wait, "he said.

    Shortly after Bizzarri was interviewed at the BoF China Summit, about China

    Luxury industry

    Several reports of the latest challenges are exposed.

    The situation is worrying because Chinese consumers have bought 32% of the total sales of luxury goods, and about 1/3 of them are overseas.

    Then there are problems faced by purchasing agents and China's overall economic situation.

    "I control what I can control.

    What can I do if the official decides to stop purchasing, "Bizzarri said.

    "Exchange rate fluctuations, turnover of people, purchasing tax...

    As a company, this is beyond our control, so as a CEO, I need to control everything I can control.

    I hope Chinese consumers can consume more in China now, so we will do our best to improve their shopping experience in China.

    Earlier this year, Bizzarri said that the ultimate goal of Gucci was to achieve annual revenue of 100 billion euros.

    Given the company's current growth trajectory, it seems likely that it will reach that level in the next few years.

    But where will the future growth of Gucci come from? The answer lies in beauty and perfume, and Bizzarri will be classified as "Gucci super micro products".

    According to Bizzarri, Gucci's current beauty business accounts for less than 7% of its total revenue, which is dwarfed by other luxury goods companies.

    Perhaps this is because the licensing procedures for Gucci products are too cumbersome.

    The product line was originally part of Procter & Gamble, which was launched in 2014 by P & G and sold to Coty in 2016.

    Just last month, Gucci launched a new Instagram account @guccibeauty, which is managed by creative director Alessandro Michele, which indicates that Gucci has renewed interest in the industry.

    "Besides, I don't think we are still restricted in other product categories," Bizzarri added. He said that the long-term sustainable growth of Gucci will depend on continued creativity, talent development and risk taking.

    "What matters is not just how much growth has been achieved, but how you have achieved growth," he said.

    Amed explained the strong Gucci.

    Chinese Market

    After showing (doubling since 2015), Bizzarri pointed out a key change in Chinese consumers.

    Although the traditional luxury touchstones (such as heritage inheritance) are very important to Chinese consumers, they are "less important" now.

    "In my view, in China," now and then "is more important than ever. This resonates with what we started three years ago in Gucci. We focus on the future instead of the past. From the rational values that consistently pursue high quality and craft, we turn to the more intimate values of sentiment and experience, interpersonal relationships and community connections.

    He added: "so from the beginning, Gucci's strategy has always been right, but in China, the younger generation is the first to keep up with these new trends of Gucci, which is more important."

    But Bizzarri's view of localization is one of the main reasons for the whole audience's attention.

    Localization is beyond the scope of product and marketing, he said.

    He explained that the trust of the Chinese local team will drive the brand to the farthest and fastest.

    "We often listen to the views of the Chinese team, because we have the honor to recruit a group of super talented people, we must let them play a role."

    If it's Steve Jobs, he will definitely say that if you recruit people who will follow your instructions, it doesn't make sense.

    The more we move forward, the less we need to reduce the attitude of westerners' managers.

    "I mean, this kind of control is false.

    You can't control everything, because we have 14000 employees at Gucci, but how can I control 14000?

    You need to rely on your individuality and strength, and try to keep them.

    In particular, if they are very talented, only if they are given autonomy and risk making some mistakes can you retain them.

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