Gucci "Lost" Black Consumers?

The risk of frequent luxury goods market has repeatedly proved that image and diversification are the most important assets of luxury brands.

In the twelve quarter of the year, Gucci, which runs all the way, has come to the turning point this season. The news of the slowdown in the first quarter has become the focus of the industry.

According to statistics, Gucci sales increased by 24.6% to 2 billion 326 million euros over the same period, the growth rate slowed sharply compared with 37.9% in the same period last year, and the growth rate of the company also slowed down. The increase in the fourth quarter of last year was 28%.

On the second day after the release of the earnings report, the opening price of Gucci's parent group opened 5%, and the market value evaporated 3 billion euros.

Thanks to the contribution of Chinese consumers, the retail sales in the Asia Pacific market increased by 35%. However, the performance of Gucci in the North American market has dragged down the overall growth of the brand, the market growth slowed to 5%, and recorded a rare single digit growth. It is also the slowest growth area in the world. It is considered that this may be related to the Gucci new series of black turtleneck sweater "Balaclava".

In February this year, a black sweater called "Balaclava" on Gucci was racially discriminated. The black turtleneck sweater could be stretched to the face of the model, with a red lip gap on its lips. The black background and exaggerated lips of the sweater were considered by the netizens to be suggestive of the facial features of African Americans. When the theme of black history was on the theme month, the product was immediately attacked by netizens.

Gucci, which continues to gain a high reputation among young audiences of social media through new forms of creativity, has received a rare criticism.

Actor Spike Lee and rapper T.I subsequently launched a boycott of Gucci and Prada in social media. The former said the brand would no longer wear Prada or Gucci before hiring some African American designers.

T.I. said that as a long-term customer of Gucci, he spent tens of thousands of dollars per year for the brand. It is not enough to apologize. He does not accept such words as "sorry, we do not mean to disrespect you".

Dapper Dan, an African American designer who launched a collaboration with Gucci earlier, also publicly criticized the brand and vowed to let executives feel responsible for this disgusting mistake.

"First of all, I am an African American, and secondly I am a brand."

He believes that no excuse or apology can eliminate this insult.

Because of the rapid decline of the situation, Gucci CEO Marco Bizzarri and its team members from Italy went to New York Harlem to meet with her.

Dapper Dan is the first designer to bring hip-hop into hip-hop culture. Gucci creative director Alessandro Michele launched in the 2018 early spring series was accused of plagiarizing Dapper Dan in 90s, and Gucci responded by calling it a tribute to Dapper Dan.

It also caused controversy about the "cultural appropriation" in the industry, but Gucci and Dapper Dan finally solved the embarrassment by introducing a series of cooperation.

Immediately after Gucci, the product was immediately removed from the store and the official website, and an apology letter was issued. The brand was deeply apologetic for the impact caused by the Balaclava sweater. "We take diversity as the foundation of value and place it in the top place before making any brand decision. The company will enhance the implementation of diversity within the organization and take this incident as a major lesson."

Not long after, Kai Yun group further announced the detailed plan to rectify and take a number of initiatives to promote corporate cultural diversity and enhance employee awareness.

Gucci promises to hire diversified talents, including creative teams, in key functional departments and leadership positions of the group, and has released four latest initiatives.

Many people naturally associate the cooling of the North American market with the negative effects of racial discrimination in African Americans.

However, Jean-Marc Duplaix, chief financial officer of Kai Yun group, explicitly denied this statement at the earnings conference. It believed that the slowdown in brand performance was not related to race discrimination cases, and emphasized that other products of the new series were still selling well. Gucci and Kai Yun group also put forward a new strategy to accelerate globalization and diversification.

In this regard, some commentators say that the impact of negative crisis public relations events on luxury brands is slow to penetrate and difficult to quantify. A negative event may require luxury brands to spend a long time to repair the brand image.

Although Kai Yun group denies the impact of racial discrimination on its performance, it still can not rule out the impact of the incident on consumer purchase decisions.

It is worth pondering that Gucci's biggest competitor, Louis Vuitton, has won a large number of African American people after the entry of Virgil Abloh, the creative director of men's clothing.

With the infiltration of hip-hop pop culture to young people around the world, the ubiquitous luxury pursuit has begun to play a role in stimulating young African American consumers to become a luxury brand fan, making the fashion industry's deep-rooted "white priority" latent rule first disintegrated from the commercial level.

In the European market of luxury core, people can see that the proportion of middle-aged white consumers in the brand stores has dropped recently, while the young African American consumers are showing an explosive growth trend.

Nelson's latest report, Black Dollars Matter, points out that although African Americans account for only 14% of the population, they contribute 1 trillion and 200 billion dollars a year.

Andrew McCaskill, senior vice president of global communication and multicultural marketing at Nelson, said that 43% of the 75 million millennial generation of the United States were African American, Hispanic or Asian. If a brand does not have a multicultural strategy, there will be no growth.

At the end of last year, the founder of Stefano Gabbana, the Dolce&Gabbana founder, pushed the brand to public opinion.

Unlike a few years ago, the Chinese market, as a strategic place for many luxury brands, has already acquired the right to speak internationally.

Dolce&Gabbana's error is no longer a simple crisis public relations can be made up, but a real economic loss. The world's largest luxury electric business Yoox Net-a-Porter group, in view of Dolce&Gabbana's inappropriate comments on China, the public opinion storm continues to deteriorate. It will withdraw its brand product from its three major platforms of Net-a-Porter, Mr.Porter and Yoox. This is also the first international luxury electric supplier after the Alibaba, Jingdong, temple library, vip.com and other domestic electricity providers.

Nowadays, the global luxury business is becoming more and more risky. The case of luxury brands suspected of racial discrimination is giving consumers the alarm.

After experiencing racial discrimination, there is reason to suspect that these very powerful Gucci are flowing to Louis Vuitton.

For brands, how to save consumers will be a difficult battle.

Just last week, a fire broke out in Notre Dame de Paris, France. The chairman and CEO Francois-Henri Pinault of Kai Yun group issued a statement immediately after the fire, and donated 100 million euros or 757 million yuan to rebuild Notre Dame de Paris through Artemis, a family owned company.

Immediately after that, LVMH chairman and CEO Bernard Arnault also announced that the group and his family would donate 200 million euros (1 billion 500 million yuan) to help repair Notre Dame de Paris.

Although LVMH, L'OREAL, Estee Lauder and other luxury fashion groups all announced donations, Kai Yun group, as the first luxury brand group to make a statement, undoubtedly won more consumers' favor.

Immediately after the Francois-Henri Pinault family issued a statement, it said it would abandon the tax incentives offered by the donation so as to express the sincerity of the donation and that the French taxpayers should not be burdened with it.

LVMH's contribution of 200 million euros has become the largest donation in the luxury fashion industry, which has attracted a great deal of attention from the group.

However, compared with Kai Yun group, LVMH also received some public murmurs.

The founder of the open cloud group gave up tax relief first, and the French people immediately questioned the motive of LVMH's donation from high tax relief.

There are also people in the industry who believe that LVMH's behavior after the opening of cloud group has the meaning of comparison.

In this regard, Bernard Arnault stressed at the annual general meeting that LVMH and Arnault family investment companies would not enjoy any tax breaks and regretted the remarks of the French people. "In France today, even if you do something for the common good, you will be criticized, while in other countries, we will be commended."

No matter whether people regard this collective event as pure social charity or utilitarian perspective to guess the commercial purpose behind the incident, the only positive explanation for the interpretation of corporate behavior does not exist. This is the complexity of modern society, and also embodies the "face" and "inside" of the luxury goods industry.

The sale of luxury goods is an abstract meaning. It is closely related to people's cognition and emotion to brands, which is the face of luxury brands.

In the abstract sense of luxury brand selling, it is the businessman's careful calculation of the brand premium.

The freshness of consumers will disappear, but if consumers are to become brand fans and attract them, they need the intervention of business skills, which is the "luxury" of luxury brands.

It is not easy to maintain "face" and "Li Zi", especially in the luxury industry with increasing risk.

Luxury brands now need to deal with "failures" and "accidents" from all sides, because the young consumers with more mature consciousness, the changing social trend and the social media with the function of amplifier are standing in front of them, which speeds up the dissemination of information and has no limit to magnifying emotions.

Consumers can not only vote for a brand because of a brand marketing event, but also boycott a brand because of a "careless passing".

Just as the heart knot between people is difficult to eliminate, the invisible barrier between luxury brand and the offender will also lie between the two parties for a long time. The brand is only careful to maintain the balance of the emotional balance of consumers.

Judging from objective public opinion, Kai Yun group has indeed brought back a city in its public relations campaign in Notre Dame de Paris.

But obviously, Gucci will not relax its vigilance for a moment.

Author: Drizzie