Category: Gucci

Renowned for the excellent quality and luxurious style of the items sold, Gucci perfume stores are popular all over the world. Solid and innovative approach to the marketing and branding procedures preconditions high rate annual revenues of the company in the fragrance industry all over the world. In the following assessment paper, the current strategy and situation in Gucci perfume stores will be observed in detailed.

Current Gucci Perfume Stores Strategy

Gucci perfume stores philosophy is reflected in the following quotation, quality is remembered long after the price is forgotten (qtd. In Moorcroft 2004). In connection with the above-mentioned statement, Gucci perfume stores strategy is based on the idea that quality is crucial in giving a customer an idea of brand while price is not the most important variable. Thus, the company targets a category of financially secure and ambitious customers ready to invest in their image and knowing the price of luxury. Gucci targeted customer category is women between twenty and thirty belonging to the get set lifestyle or wishing to demonstrate their association with this category (Arrigo 2011).

Gucci perfume stores management bases the network strategy on the concept of distinctiveness and exclusivity among the target category of buyers. To promote company elitism, the leaders have designed an image of Gucci customer characterised by vibrant appearance, sexual appeal, and ambitious stance (Fig. 1). The image is widely represented in the media and shopping malls through massive advertising companies, innovative approach to marketing, and the whole experience of shopping with Gucci perfume stores. The aura of prestige communicated through the Gucci image gives added customer value to the products sold in Gucci perfume stores since consumers are ready to invest additional funds into associating themselves with the picture of success, sexuality, and exclusivity the brand is depicting (Arrigo 2011).

Gucci perfume stores interior design (Fig. 2, Fig. 3) is an essential attribute of Gucci image according to the company leaders (Arrigo 2011). For that reason, every single detail of store design is taken into account by the top management. The company strategy includes the following essential components of Gucci perfume stores decoration and operation worldwide: (1) location on expensive high streets or at the best shopping malls in a city; (2) provocative decoration of the window displays; (3) visually appealing interior with a free flow layout; and (4) comfortable consumer browsing of collection on exhibit. Apart from rich classic decor, the company concept includes standardised requirements to the store employees. All of them should meet the highest requirements to their appearance, they should be smartly dressed in clothing of dark colours, and their outfit is to feature high quality makeup. To conclude customer experience, distinctive packaging is utilized. All Gucci perfume stores are directly operated by the world headquarters in order to ensure strict control of the company image implementation.

Current Situation

Current business situation for Gucci perfume stores is favourable which can be seen from the following figures. According to Global Fragrances and Perfumes Industry (2013), Gucci perfume stores annual revenue in 2012 was $1552.6 million in the United States and internationally it exceeded $4464.4 million. In 2013, the U.S. market demonstrated 18% growth for the company and the international market maintained the rates of the previous year (Global Fragrances and Perfumes Industry 2013). The increase at the American market is traditionally observed in the womens sector. Nonetheless, the company was surprised to register the growth at the mens sector that year (Mens fragrance sales soar in the UK and US 2013).

The key to success of Gucci perfume stores is exclusivity along with distinctiveness. The company works with the best designers, the most innovative developers, and the most ambitious and risky marketers. To illustrate, Gucci advertising company of Opium perfume became one of the most controversial in Britain due to the use of a naked image of Sophie Dahl. Despite the uproar in society, the perfume company was a great success and won a number of prestigious awards in European advertising competitions (Arrigo 2011). Another example of Gucci advertising strategy is the advertisement in Vogue magazine with an image of a naked lady having the letter G depicted on her private parts. The use of this audacious advertising solution helped Gucci boost customer awareness of the brand as well as ensure wide media coverage. Another winning strategy the company is utilizing is involvement of top stars from popular industry and designer community.

References

Arrigo, E. 2011, Fashion, Luxury and Design: Store Brand Management and Global Cities Identity, Symphonya, no. 1, pp. 55-67.

Global Fragrances and Perfumes Industry, 2013, PR Newswire, viewed 02 May 2014, via ProQuest Central Academic Database.

Mens fragrance sales soar in the UK and US, 2013, Telegraph, viewed 02 May 2014, via ProQuest Central Academic Database.

Moorcroft, R. 2004, Quality remembered when price forgotten, The British Journal of Administrative Management, no. 1, pp. 4.

Introduction

In the contemporary world, both teens and young adults tend to identify themselves with particular brand names in the clothing sector. This is basically because they believe that, it promotes a certain image to them as individuals. One of the most common brand names is Gucci.

This company is often referred to as the House of Gucci or just Gucci. It is famous for its luxurious designs in both clothes and accessories that are coveted globally. The original designer of the Italian fashion house was Guccio Gucci and the company logo thus consists of the G letter. Two G letters face each other interlocked in such a way that, one G is reversed.

The teens and young adults today perceive attires from the Gucci Company, as the main thing that makes them look classy and cool by virtue of the companys good reputation and fame. This classy and cool image they acquire in wearing Gucci clothes can be said to have been created by both the company advertising, and the Gucci users themselves.

The Connection between Advertising and Cultural Values

Advertising and particular cultural values connect in such a way that, the way a product is advertised ought to be in line with cultural values for it to be accepted and sold easily. According to Hovland, advertising often impacts the choice of brand customers decide to utilize versus the advertisements capacity to add the products generic demand.

The way a certain product is advertised plays a big role in fostering the standards of a certain product. However, it is still uncertain as to how much advertising remains a reflection of what already exists, or it actually sets standards that are followed by others. Even in the Gucci Company, it is paramount that its adverts utilize values as well as symbols relevant to teens culture.

Despite the fact that advertising may reflect the already existing culture, the fact that it reflects can actually shape culture because there is no equal reflection for everything. It is therefore true to say that, as much as advertising reflects on certain cultural values, it is very selective on this because it echoes as well as reinforces certain behaviors, attitudes and values more frequently than others (Hovland 164).

Impact of Advertising on Brands and young Adults

The cultural values of teens or young adults ought to be in line with a particular urge to be cool and classy at the same time. This has largely been identified with the way the Gucci clothing is advertised to make the consumer feel that its products are classy and most cool in the fashion trends. It is thus very crucial that an advert attracts customers to buy its products, and also that these products also meet the standards claimed in the advertisement.

As much as its adverts are good, the Gucci clothing can be said to have acquired merit in that, they have quality products that have over years gained much reputation. The young adults tend to have a culture of coolness, they want to have and wear the latest designs around and not just any imitations there is. It is because of inter alia, such cultural values within the young generation, that the Gucci Company has increasingly gained market for its clothing.

Conclusion

In a nutshell, the teens and young adults of today love the Gucci brand name when it comes to clothing. This is because the youth have over time developed a culture to always be fashionable and cool, at the same time to be classy or original as the Gucci clothing depict. The youth thus believe that, wearing the Gucci products promotes this image of coolness and class.

This is something created by both the existing cultural values of young people, as well as the influence of advertisement such as Gucci. The two factors therefore connect in bringing interest to young customers in purchasing Gucci clothing.

Works Cited

Hovland, Roxanne. Advertising, Society, and Consumer Culture., New York: M.E Sharpe, 2010.

Brand analysis of Gucci: the brands positioning, audience, current product trends, and challenges

Gucci identifies itself as a luxury fashion brand producing clothes, footwear, and accessories. Although it already has an established image of a high-end fashion brand, the company continues to change, experiment, and bring new styles and combinations of influences to its products. The brand claims its culture of creativity and innovation (Letter to Shareholders 2) to be one of their fundamental characteristics. Other aspects of the brand listed in the self-description are that it is eclectic, contemporary, [and] romantic (About Gucci par. 1). An important component of the brands positioning is its association with celebrities who wear Gucci clothes to publicity events as well as in their everyday lives.

Although Gucci has recently undertaken several campaigns aimed at young people (Ali par. 1), its target audience is rather defined by income than by any other criteria like age, gender, or marital status. Since the brand does not provide any discounts to its customers, it can be concluded that the target audience consists of high-income individuals who do not need financial incentives. An important aspect of Guccis marketing is helping the brands customers demonstrate their high social status, as well as express their individuality. That is why Gucci attracts many celebrities to advertising the brands merchandise.

The style of the recent Gucci collection is described by critics as a combination of classic Italian art, street culture of the 1970s and 1980s, and French couture (Mower par. 1). Fall-winter items are colorful, eclectic, vintage, and informal. The mixture of chic and rebellious themes is to appeal to younger people.

The main challenge that can be recognized is the current economic situation that creates difficulties for all luxury brands. Also, there are modern-day social trends that are threats to the popularity of Gucci. Since its establishment, the brand has been associated with leather products. In recent collections, fur, ivory, and other animal products were used. With the growing social opposition to the use of such materials in fashion, Gucci may experience a decrease in the customer pool.

Recommendations

Within past year, Gucci has been successful both financially and in terms of branding and communications. Among all the brands that are part of Kering, Gucci not only gained the largest profit, but also grew in terms of financial performance compared to previous years much more than it had been predicted by critics (Thompson par. 3). However, there are always opportunities for growth, development, and improvement. Based on the analysis of merchandise and marketing, three major recommendations can be offered to Gucci: to continue the innovative strategy, to promote the image as a responsible business, and to widen the distribution channels.

First of all, Gucci would benefit from further creative innovation. It should be recognized that the recent success of Gucci, which critics responded to stating that Gucci was cool again (Brinded par. 1), was due to the appointment of Alessandro Michele as the Creative Director. Michele adopted new themes and styles to the collections he created for Gucci, which reignited the consumers interest and made the fashion designer an influential figure. If a company has a business model that is developed well enough to benefit from innovation, the company should further support innovative initiatives (Teece 191). Therefore, Gucci should not concentrate on its achievements and established styles but focus on further creative experiments as they prove to promote the brand.

Second, the company should invest in maintaining and developing the reputation of a responsible business. As the present-day economic situation may reduce the customer pool for luxury brands, Gucci should be interested in attracting new audiences. A way to do so is to promote the image of a company that cares about its customers, society, and the environment. Within recent years, Gucci has been involved in different kinds of charity, as well as increasing environmental friendliness of their manufacturing. Such activities, as well as corporate social responsibility efforts, should not only gain loyalty in existing customers but also attract new ones.

Finally, Gucci can benefit significantly from developing its existing distribution channels and creating new ones. One of the key existing distribution channels of Gucci are directly operated stores, which represent an appropriate and beneficial distribution model for a luxury brand, but can also be regarded as not flexible enough. In the modern world, a business should pay attention to online purchasing opportunities. Not in every country where Gucci merchandise is distributed, online shopping for it is available. Gucci should try to fix it without damaging its reputation of a high-end brand, which means preserving its image of not being available to everyone.

Based on the analysis of history, marketing, performance, and strategies of Gucci, it can be recommended that the company continues its successful creative innovations, builds a favorable image of responsibility, and explores broader distribution opportunities. These recommendations pursue maintaining the positive response from critics, creating stronger connections with established customers, attracting new customers, promoting a positive image, and increasing availability. Achieving these objectives will translate into higher sales and higher profit.

Works Cited

About Gucci2016. Web.

Ali, Sanzida. Gucci Consumer Targeting. n.d. Web.

Brinded, Lianna. Gucci Is Cool Again.Business Insider. 2016. Web.

Letter to Shareholders 2016. Web.

Mower, Sarah. Fall 2016 Ready-to-Wear: Gucci.Vogue. 2016. Web.

Teece, David J. Business Models, Business Strategy and Innovation. Long Range Planning 43.2 (2010): 172-194. Print.

Thompson, Adam. Kering Sales Jump as Gucci Brand Shines.Financial Times. 2016. Web.

Executive Summary

Background

Gucci (Guccio Gucci) by Guccio Gucci opened a leather goods company and small luggage store in his hometown of Florence in 1921. Gucci, along with his three sons Aldo Gucci, Vasco Gucci and Rodolfo Gucci, expanded the company to include stores in Milan and Rome and other stores in Florence. In 1960, a purse with shoulder straps and engraved decorations was introduced. The original Gucci loafers were updated in 1966 with unique decorative ornaments, and the ‘Rolls-Royce suitcase was initiated in 1970. Subsequently, watches, jewellery, ties and glasses were added to the company’s product line. A particularly iconic style introduced in 1964 is to be used of the double G logo in the decoration of belt buckles and other accessories. The company flourished in the 1970s, but the 1980s were dominated by internal family disputes that brought Gucci to the brink of disaster. Rodolfo’s son Maurizio Gucci took over the work of the company after his father’s death in 1983. The failed management led to the forced sale of the family business to the investment group to a Bahrain-based company, in 1988. In 1989, Dawn Mello was introduced as editor and ready-to-wear designer to re-establish a reputation. In 1990, Tom Ford was hired to come up with the ready-to-wear collection. In 1997, there were 76 Gucci stores worldwide, and the Gucci Group acquired the ownership of Yves Saint Laurent Rive Gauche, Bottega Veneta, Boucher on, Sergio Rossi, and some with Stella McCartney, Alexander McQueen and Balenciaga.

Today, Gucci is committed as part of the luxury operator Kering Group. As of 2019, Gucci has a total of 487 stores in the world, and its value has significantly increased in recent years, from 147 billion euros in 2009 to 281 billion euros in 2019. There is no doubt that Gucci has achieved remarkable success in the luxury market. (ibisteam, 2018)

Gucci Customer Demographics

Gucci mainly segments customers by age and gender. Those who are rich or (upper) middle class enjoy the lifestyle represented by Gucci. Gucci is suitable for those who want to be considered fashionable and luxurious. With the advent of the information age, after 2015, the brand will focus on the age of 25 to 35 years, enter the market and expand to the Asian market, rather than the emerging European market. Gucci focuses on fashion with a high taste and wants to show Western Europeans want exclusive alternative products, while North Americans want to have more features, higher quality and more beautiful at the same time.

Due to the continuous emergence of new designs, eye-catching brand images, rich product experiences, eye-catching logos on handbags and accessories, and a wide range of Gucci product categories targeting different customers, Gucci has large number of loyal customers. Unlike other luxury brands, Gucci knows the lifestyle of the younger generation very well. And, Gucci launched social media accounts, such as Facebook, Twitter, Instagram, WeChat, Weibo, etc., to promote and cooperate with online celebrities. As the globalisation of the international market has promoted the emergence of global culture and global consumption has rapidly become homogenized, Gucci tries to meet the needs of all major cultures in its market; these include the cultures of North America, Western Europe and China. There is something in common between North America and Western Europe, but China needs a different way to attract customers. Client analysis The main target groups of Gucci include the affluent, upper-middle-class and middle class in society. Including celebrities and fashionistas. In the past, Gucci was almost just the wealthy class in society, so it has been expanding its target population. The average client age is between 20 and 50 years old, both men and women. Gucci also launched the children’s series Gucci in 2010. An important factor for its success is its ability to connect with the Z generation and the millennial generation customer. Thanks to Alessandro Michele’s design and new experiments in marketing

Strategy, Gucci has done a great job on digital channels like Instagram and Facebook. This means that Gucci has developed a core customer category of 25 to 35 years old, accounting for almost 50% of total sales. Gucci can quickly accept the latest trends and use it to expand its brand awareness. Their Instagram account now has 19.4 million followers, their Facebook page has 16.6 million likes, and they are previewed using Snapchat. The brand has been using a variety of digital platforms to convey a unique identity-through fascinating visual effects; now there are more images on their website that reflect Gucci’s latest story. They hired a lot of bloggers and Instagram ‘stars’ to promote their brands and content. Celebrities like Beyoncé wore Gucci at concerts and influential events, and their haute couture were widely used by critics and consumers worldwide Welcome and love. As a fashion trend leader, Gucci is very eager, every fashion lover wants to see his own fashion show. Many magazines and blogs are writing reports about the Gucci fashion show and introduced the new designs that Gucci quickly showed because they know that fashion will never disappear. Their brick-and-mortar stores give people a sense of exclusivity and luxury, and their staff is always the most rigorously trained to provide customers with the best in-store experience to increase customer engagement and contact. Multilingual staff ensure different Customers in countries have a good shopping experience in physical stores, this also provides more jobs and opportunities to society.

The company divides its product range into the following categories:

• Woman: Provide handbags, ready-to-wear, shoes and accessories. $216-$8385
• Men: Provide handbags, ready-to-wear clothing, shoes and accessories. $215-$11650
• Children: including ready-to-wear, shoes, accessories and gifts. $50-$2275
• Beauty: including cosmetics and perfumes for men and women. $57-$850
• Jewellery and watches: including fine jewellery, silver jewellery, fashion jewellery and watches. $215-$3800
• Decoration: provide household items and furniture $105-$46615

(Guccigroup, 2016)

Gucci

Gucci is an Italian fashion brand has nearly 100 years history in this luxury industry. It is now achieving the vision to become the leading luxury fashion house in the world with more than 13$ billion brand value. Not only succeed in its main corporate activities to bring their value through craftsmanship, this brand also is loved by its philosophy of sustainability. For Gucci, Social Responsibility is an important part of their global strategy and they want to be the leader of luxury brands to promote sustainability. This is the key point in our suggested project for the brand to engage to the innovation of new materials for apparel, one step further to enter the futuric and high technological industry to pursue its mission.

History

Gucci was founded by Guccio Gucci in Florence, Tuscany, in 1921, now it comes from strength to strength to become a leading name in fashion and leather across the world.

Guccio Gucci was the son of a humble Italian leather maker and he desired to achieve a life better than his father. After he had experience about leather and the revolutionized in this luxury fashion industry during the time he was a hotel worker at Savoy hotel (London), he came back Florence to open The house of Gucci in 1921, when he was 40 years old. The store was a success, and with the help of his three sons, Gucci soon expanded the brand by opening up additional stores in Milan and Rome.

By the 1950s, Gucci had established itself as a premier luxury brand. His sons, Aldo and Rodolfo Gucci further firstly expanded the company’s horizons into global in 1953 by establishing offices in New York City, anchored by the luxurious Savoy Plaza Hotel. Two weeks after this event, Guccio Gucci passed away.

The company prospered through the 1970s, but the 1980s were marked by internal family disputes that brought Gucci to the brink of disaster. The company faced issues regarding family arguments, tax evasion, poor management, all which affected the company reputation and profit.

In 1990, Tom Ford was hired by current director and promoted to the position of creative director in 1994. He was the important person of Gucci in that period, not only for his revolution in design of ready-to-wear collections, but also for his contribution in the process of decision-making with De Sole when the Gucci Group acquired Yves Saint Laurent Rive Gauche, Bottega Veneta, Boucheron, Sergio Rossi, and, in part-ownership with Stella McCartney, Alexander McQueen and Balenciaga to build Gucci house, consists of others fabulous fashion brands. By 2001, Ford and De Sole shared the responsibility for major business decisions, while Ford concurrently directed design at Yves Saint Laurent as well as at Gucci.

In 2003, The French conglomerate Pinault-Printemps-Redoute (now Kering group) gained ownership of 60 percent of the Gucci Group’s stock, became the holding group of Gucci house.

December 12, 2014, Marco Bizzarri was appointed CEO of the brand and he appointed Alessandro Michele to be Gucci’s creative director in 2015. Then Michele reintroduced the company’s double-G Marmont logo and helped Gucci marked a significant growth of 12% of revenue in 2016.

Identity

Double GG logo: Today, the Gucci logo has become synonymous of luxury and sophistication and is still immediately recognizable by anyone. Aldo Gucci, one of Guccio’s three sons, joined The House of Gucci in 1933 and he was the one who designed the actual logo. The official logo also has the Gucci name spelled clearly out above the double-G emblem, ensuring the reorganization of the logo and showcasing the importance of the brand’s name. The logo of two interlocking G’s was adopted around 1960s, as a sweet homage to the founder, Guccio Gucci.

And while the “G” logo is no-doubt considered one of the most recognizable “classic” logos in the world, the iconic green and red stripes have also become synonymous with the luxury house. When you see this colorway, you know it is there for one of the world’s most successful brands. The signature can speak for the brand even without the double G logo.

2.Products

At the beginning, Gucci’s stores featured such finely crafted leather accessories as handbags, shoes, and his iconic ornamented loafer as well as silks and knitwear in a signature pattern.

In 1940s when leather was in short supply as a result of the League of Nations’ embargo on Italy’s Fascist dictatorship and due to the war. Gucci used alternatives usually linen and bamboo – then Gucci Bamboo bag was born. In 1947, an artisan created a bag shaped like a saddle with handles made by bamboo. This is one of the most popular and iconic creations of the brand’s history.

Jackie Onassis Kennedy chose a gorgeous little hobo as a staple only to have the silhouette renamed the “Jackie” bag in her honor. The Jackie bag still remains one of the most sought after classic Gucci items. As the 1960s rolled through, monogram mania set in and the signature interlocking GGs were strewn across handbags, luggage and clothing, cementing its place as one of the most identifiable designer logos of all time.

In 1932 Guccio created the first loafer shoe with a gilded snaffle. Every pairs of horsebit loafers is handmade in Florence.

In 2013, Gucci celebrated loafer 60 years old. Like hermes, the first clients of Gucci were the horse riding aristocratic fraternity who come to the designer in search of quality fashionable equestrian gear.

Gucci now iconic flora Print silk scarf was originally made for Grace Kelly. This kind of scraf wasn’t named after the stars. Grace Kelly visited Rome’s via Monte Napoleone store in 1965. And Rodolfo asked artist Victorio Gennairo to create an original silk scarf with a floral pattern as a gift to mark that occasion. After that, there is a recent update by brand artist Christ Knight as a part of crew collection and iterations of the iconic design still be found for sale.

1970s The first Gucci perfume is created. Nowadays, Gucci perfume is licensed for Coty.

1980s Thanks to Tom ford, Gucci ready-to-wear collection was shown for the first time at the Florentine fashion shows with great success.

AT the present, besides accessories, apparel, hard luxury, fragrance and cosmetic, Gucci has entered house decor segmented industry.

3. Finance

As of December 31, 2018, Gucci operated 540 stores globally, including 229 stores in emerging markets. Gucci delivered an excellent performance in 2018. Listed at the 39th position in Business week Magazine’s top 100 global brands, Gucci holds the value of approximately 13 millions $ in 2018.

Gucci’s revenue topped the €8 billion mark in 2018, reaching €8,285 million. This represents a year- on- year jump of 33.4% as reported and 36.9% based on comparable exchange rates. All of the brand’s main markets reported robust growth during the year.

North America has an increase of 43.6%, take over the first position of growth speed from European market. North America was also by far the highest performing region in terms of online sales, which increased over 60%.

In Japan, in-store sales advanced by an impressive 35.7% on a comparable basis, led by the recovery in tourist numbers seen since the second half of 2017, especially for Chinese tourists, as well as domestic market share gains. In emerging markets, revenue increased at 42.7%, with all regions contributing to this excellent performance, including Asia- Pacific, where revenue surged 45.0%. Strong sales momentum with Chinese customers drove very solid growth in Mainland China as well as significant revenue increases in the region’s other markets. In Western Europe, there was an increase in revenue at 28.5% for the region overall.

4. Sustainability

Gucci become the partner of UNICEF in 2005. Gucci stores worldwide donate a percentage of the sales for special collections made specifically for UNICEF to go toward the United Nations Children’s Fund.

Launched in February 2013, the ‘Chime for Change’ campaign works to further the global campaign for girls’ and women’s empowerment. Gucci has funded over 210 projects in 81 countries through this initiative.

In line with Kering’s long- lasting commitment to sustainability, and the introduction of the “Culture of Purpose” ten- year sustainability plan, Gucci launched Gucci Equilibrium, a new portal designed to promote and broadcast the brand’s perspective on environmental and social impact change, and portal connecting people, planet and purpose.

Technology and innovation: Providing a study into luxury fashion consumer preferences, the 2018 Gartner L2 reports reveal fashion marque Gucci as the leader in the world of digital and social media. Thanks to a perfect blending of site functionality, a seamless shopping experience, integrated content and robust search and navigation, the brand was declared the Top Genius brand for the third year in a row. Gucci was the first to invest in top-tier site functionality and build on a strong shopping experience through integrated content, robust search and navigation, and aesthetically pleasing product pages. To drive customer satisfaction, the Italian retailer has built a Facebook-integrated chatbot and it also launched scannable adverts. For its spring 2018 campaign, Gucci developed in-store augmented reality (AR) and virtual reality (VR) installations, which allowed consumers to become a part of the campaign. Since 2017, Gucci remains the most visible brand across e-tailers, scoring higher that multi-brand retail sites such as Farfetch and Net-a-Porter. Comment by Le Trang:

II. Industry analysis Comment by Le Trang:

The wearable technology market is a relatively new one, which has experienced increased growth year on year. Triggered by the immense popularity of smart watches, fashion companies have started to enter into this market due to the endless possibilities and potential for high sales and profits. By the end of 2018, it was estimated that the wearable technology market was valued around $5.8 Billion (Transparency Market Research, 2019). However, it is predicted that the market will experience immense growth every year and experts predict that by the year 2022, smart wearable product sales will increase dramatically becoming a $27 billion dollar market with 233 million unit sales (Forbes, 2018). Overall, these figures demonstrate the attractiveness of the industry to both Gucci and Google due to the vast future growth predicted in the market.

Wearable technology consists of two main definitions, including independent central devices playing a role as connectors for other equipment, and the concept of functions to conduct specific actions of users or to measure required data of the user’ body (Godfrey et al., 2018). As wearable technology advances practical industrial applications, this segmentation is a potential market for fashion companies and designers. The launch of wearable computing devices from global companies like Google Glass eyewear in 2013, Apple Watch in 2015 and Mood Shirt patented by Microsoft in 2016 (Mancoff, 2019) is a strong evidence for the development of this high tech fashion trend in the future.

Therefore, in order to enter the new potential market of high tech fashion, a co-branding project between Gucci and Google could benefit both partners and take advantage of strengths both sides. Gucci and Google can form a complementary partnership and synergies as both companies are ranked as the most valuable brand in the world by Forbes (number 2 for Google and number 36 for Gucci) (Forbes.com, 2019). In addition, Google has experiences in cooperation with fashion brand to create high tech products, especially the cooperation with Levis called Levi’s Commuter Trucker Jacket with a platform named Jacquard by Google allowing users to connect with their smartphone immediately by touch gestures (Jacquard by Google, 2019). The prestige of Gucci could also make an important contribution to the success of the project as Gucci is ranked as the top of the top 15 most popular luxury brands online in 2019 through a research of Luxe Digital Company (Beauloye and Beauloye, 2019). The cooperation between Gucci and Google will mainly focus on the niche segment with regard to smart materials including conductive yarns and textiles from Google which enables Gucci to become the first company offering unique designed and convenient suit jackets for businessmen. This opportunity is also a golden chance for Google to enter to luxury fashion industry through Gucci distribution channels and to reach to the segment of customer with more exclusive and iconic characteristics. This will also give Google Jacquard an opportunity to have insights of customers’ need and behaviours, especially as both companies share the same mission in innovation for future sustainable development.

III. Creative process

1. Product

a. Description

Gucci’s new high-tech men’s suit jacket will take advantage of new integrative clothing technology provided by Google to allow the individual wearing the jacket to connect to their phone. Through the use of gestures, such as tapping your wrist or swiping up the sleeve, you’re able to use applications on your phone including Google Maps, Google Mail and Google Music as well as answering or declining phone calls. Comment by Alex Miles:

Some competitors of Gucci have introduced forms of wearable technology (see below in competitor analysis), however none have introduced a product or range which allows you to connect to and use multiple applications on your phone. Additionally, other companies who aren’t luxury fashion brands have entered in the wearable technology market , however none of them are offering a men’s suit jacket. For this reason, this product is one of a kind and we expect it to take the market by storm due the reputation for Gucci clothing combined with how important mobile phones are to people nowadays and how frequently they are used.

Show the video of Jacquard introduction: Comment by Chu Phương Huỳnh:

• https://www.youtube.com/watch?v=qObSFfdfe7I

b. Target customer

The target customer for our new product is businessmen who are highly ranked in organisations and well paid in their profession. The principle reason for this is that Gucci is a luxury brand and their products are exclusive and only available to the people who can afford them. These target consumers will also be very busy due to their important position in the firm and therefore will need to communicate with subordinates frequently and will constantly be on the move. For this reason, these businessmen will benefit from deriving all the benefits of this product including accepting/declining phone calls with ease, using Google translate and receiving reminders from Google Calendar. Furthermore, we expect our target to be between the ages of 20 and 35 as consumers of this age group are members of either Generation Y or Generation Z. These generations, in particular Generation Z, have a better understanding of and more frequently use technology and therefore are more likely to buy the jacket as they can observe the benefits and usefulness of it.

c. Price

Due to the history and luxury of the Gucci Brand, they are known for producing some of the finest and most expensive suit jackets in the entire world. Men’s Suit Jackets produced by and sold on the Gucci website have a price range of between €1,500 to €3,500. As our new product will be very unique, different, exclusive and in very popular demand we have decided to price our new high-tech men’s suit jacket at €4,800. The reason for this is that the scarcity and exclusivity of this product allow us as Gucci to charge more for the jacket and consumers will still buy it. Additionally, as this jacket is very different from anything currently available in the luxury fashion market, consumers will be anxious to get their hands on it and be a part of the up and coming futuristic technological clothing market.

2. Market analysis

a. Market overview

When introducing their new product Gucci will transition from the luxury fashion industry into the wearable technologies market. This is a relatively new and upcoming market, which only a few luxury fashion brands have entered. Louis Vuitton, Hermes, Giorgio Armani and Prada have all entered the market through introducing their own smartwatches, however no luxury fashion brand has entered into smart textiles segment of the market. Therefore, Gucci will be the first luxury fashion brand to enter into this segment of the wearable technologies market.

b. Competition analysis

Despite this, there are other non-luxury fashion brands who have entered into the smart textiles segment of the market. Firstly, Tommy Hilfiger have introduced a new line of smart clothing imbedded with bluetooth chips, which track the movements of the clothing enabling consumers to be rewarded for wearing their clothing. They have included these chips in T-shirts, hoodies, jeans and bum bags for both men and women. Additionally, they also introduced clothing, which links to the game Pokemon Go. Secondly, Polo Ralph Lauren has started selling a “PoloTech smart shirt” for men, which has sensors implanted into it so it can measure and track vital signs, such as stress levels, breathing rates, heart rates and total calories burnt. The information collected by this shirt will be transferred to an app creating a customisable workout plan. Thirdly, Levis have introduced a new “Commuter Trucker Jacket” made from denim, which allows wearers to connect their phone to the jacket and carry out actions, such as changing or pausing music through the use of gestures. Fourthly, Samsung has also entered in the smart textiles segment of the wearable technologies market. Having already introduced a “Body compass workout shirt” which measures biometric data and a golf shirt, which includes UV rating and weather trackers, Samsung have now introduced a “NFC smart suit”. This smart suit allows wearers to unlock their phone, set gadgets to office and drive modes and swap business cards digitally. This product is the most to our new product as it is also a suit, however there are two major differences between the products. Unlike Gucci, samsung don’t have the reputation as a luxury fashion brand and therefore, their product will not have the same target audience as ours. Furthermore, our product will have more features and capabilities in comparison to Samsung’s product. Finally, the Nadi x Yoga pants, Athos compression shorts and Emel and Aris Smart Coat represent two further companies who have entered the smart textiles segment of the wearable technologies market.

c. Positioning

This diagram represents the Wearable technologies market as a whole by exploring 4 different areas. It identifies the major brands who have entered into the different segments of this market. This diagram demonstrates how Gucci will be positioned in the smart textiles segment of the market alongside brands, such as Polo Ralph Lauren, Samsung and Tommy Hilfiger. It also illustrates the minimal competition present within the smart textiles segment of the market.

This diagram presents the Smart Textiles segment of the wearable technologies market by splitting the segment into four different clothing categories. This diagram demonstrates how Gucci will enter the Suit Jackets/Blazers clothing category, one which only Samsung have also entered. Despite, this our new product will be very different to that of Samsung. Samsung’s NFC Smart suit is more focused on the technological aspect rather than the fashion aspect, which is reflected in it’s price of €350. In comparison, our Gucci suit will combine the technological expertise of Google with the distinct fashion of Gucci to create a stylish and luxury high-tech men’s suit jacket. Overall, this demonstrates that even though we will be in the same clothing category as segment as Samsung we will have very different target customers and products.

Gucci Canada: fur-free campaign proposal

I. Executive summary

Gucci is one of the winners among the top 100 power luxury brands when the global luxury market has grown at a staggering pace for many years until recently. In 2017, Gucci’s increased its sales to Euro 6.2 billion by 44.6% over the year 2016.

Like the other luxury brands, however, Gucci faces serious challenges in the years ahead. Brands must demonstrate that more than just making money, they need to promote sustainability, ethical business practices, and to embrace millennial-focused business models so that they can stand out. In October 2017, Gucci made their fur-free commitment and announced to cease releasing fur product beginning with its spring 2018 collection to reduce its impact on animals and the environment.

Purpose is key. Gucci needs to fulfil its fur-free promise and at the same time to keep its top brand image and leading marketing position in terms of revenue and profit, therefore I conducted thorough research in order to develop a proprietary cause marketing campaign. The research adopted a deductive approach for a combined method strategy consists of case study and archival research. The data collected were mainly quantitative, some secondary qualitative data were used, too.

Based on the research results, I am proposing a plan to launch a one-year global campaign #GucciFurNotCool! This campaign aims to convene, unite and strengthen the voices of millennials speaking out for fur-free trade to raise public awareness for animal protection by using innovative approaches combined offline and online activities. Through this campaign, Gucci will be the first luxury brand continuously spreading positive values against animal killing and fur selling. The millennials who get involved in this movement will continue to be Gucci’s loyal customers. By building up a long-term partnership with NGOs like PETA and with social media giants etc. Gucci aims to attract more brands to follow up its movement and together to significantly decrease animal killing by the year of 2025.

II. Introduction

A. Gucci Business

Founded by Italian Guccio Gucci in Florence in 1921, Gucci quickly become one of the most well-known luxury brand of fashion and leather goods. Now Gucci is part of the Kering Group, a world leader in apparel and accessories that owns a portfolio of powerful luxury and sport and lifestyle brands.

At the beginning of 2015, Gucci started a new chapter in its history, under the direction of a new management team led by President and CEO Marco Bizzarri and Creative Director Alessandro Michele. They created a new contemporary vision, it made the brand rapidly re-establishing its reputation as one of the world’s most influential luxury fashion brands.

Gucci invented a wholly modern approach to fashion-electric, romantic, and above all contemporary, and, in doing so, successfully redefined luxury for the 21st century. The new aesthetic vision, combined with a progressive business leadership, has led to outstanding performances across all categories and regions, confirming the establishment of a unique and compelling brand positioning and narrative that is engaging with a wide luxury customer base across various nationalities and demographics.

The driving force behind Gucci’s reinvention is to be found in a new, contemporary corporate culture of employee empowerment and open communication, built on key values, which feed into the whole organization through the empowerment of innovation and risk-taking, a sense of responsibility and respect, an appreciation for diversity and inclusion, and excellence in execution.

Gucci products continue to represent the pinnacle of Italian craftsmanship and are unsurpassed in terms of their quality and attention to details.

B. Gucci Community

Gucci ranked 41st in position in 2009 ‘Top Global 100 Brands’ by Interbrand with about €4.2 billion in revenue worldwide in 2008 according to BusinessWeek, while in 2018 it climbed to number 5. Today Gucci operates about 529 directly operated stores around the globe in 2017, and it wholesales its products through franchisees and upscale department stores.

After many years staggerating revenue and profit, Gucci’s sales grew to Euro 6.2 billion by 44.6% over the previous year. And in the first quarter of 2018, the brand posted nearly $2.2 billion in sales revenue, up 48.7% compared to the same period last year.

Gucci products are sold exclusively through a network of 529 directly operated boutiques, a directly operated online store(in30 markets), a limited number of franchises, and selected department and specialty stores.

At the end of the year 2017, Gucci retail sales represented approximately 85% of the brand’s total revenue.

Demographic Segmentation

Demographically, Gucci produces brands for male and female, children and adults respectively. Their brands are for the category of male and female who love the desire to impress others, have a high social class and strong financial base. But basically female purchase more than male. Those who love the brand are driven by the kind of lifestyle they live and the need to maintain that lifestyle (Gucci.com, 2010).

Recent years, Gucci adjusted their policy to target more on millennials, i.e. the young people below age 35. According to Fast Company, Gucci CEO Marco Bizzarri’s partnership with famed Harlem tailor Dapper Dan has helped transform the Gucci brand for a new generation of luxury consumers: the hip-hop crowd. Gucci’s name has been used in lyrics by artists including Pusha T and 2 Chainz, which have likely influenced millennial demand.

To win with millennial consumers, Gucci understands what millennials value: personal satisfaction and purpose. Gucci’s relationship with millennials is more powerful than any other luxury brand’s and it has simultaneously brought back many of its loyal customers.

“Digital has changed the rules of the game. The digital scene is not an option – you have to be part of it,” Bizzarri explains. “As Millennials make up almost half of Gucci’s consumer base, it was vital for the brand to embrace digital communication and connect with this new, large and up-and-coming consumer group.” Gucci develops stylish e-commerce site, customer service, shoppable features, and online advertising, as well as the brand’s visibility on third-party e-commerce sites which underlined that Gucci’s interactions on social media doubled between 2016 and 2017.

In 2017, Gucci’s e-commerce sales rose by 86 percent. Millennials accounted for about 50 percent of revenues. Total Gucci brand sales increased by 42% percent to Euro6.2 billion.

The growth reflected synergies from the brand’s reinvention of millennial customers (know as “geek-chic”) and its online experience.

Gucci’s omnichannel integration of its online and in-store brand experience helped it win L2’s Digital IQ Index: Fashion US in both 2016 and 2017.

Socioeconomic Segmentation

Gucci brand does not consider the economy class or the middle class; thus an inefficient utilization of the market population, as the market lies in this category of consumer. Focusing more on millennials who are 20-36 ages now, Gucci knows the importance of connecting with the Millennials, as they will be shaping the consumption patterns over the coming decades and soon move into their prime spending years.

Geographic Segmentation

Gucci is very conscious of the countries it locate its brands considering the fact that they are exclusive and of great quality.

Gucci operates in very few countries in America and Europe whose consumer behaviour is unique in terms of quality. For example,France populace are willing to pay more for quality. In recent times, Gucci has spread to France, Germany and Belgium (Gucci.com 2010).

Gucci’s geographical segmentation is poorly structured as it tends to ignore developing countries and emerging markets.

C.Overview ofGucci’s current corporate social responsibility

Culture of Purpose

Gucci Equilibrium, is a collection of their values, positive instincts and ambitions. It’s a balance of the aesthetics of the things we produce with the ethics in which they believe. Gucci claims they are driven by their Culture of Purpose.

Sustainability for Gucci

Gucci considers sustainability to be the engine of a process of continuous improvement that contributes to the strengthening of economic performance and the control and mitigation of business risks. A responsible attitude towards people, the land, the environment and the community has always been part of Gucci’s value system, in addition to superior craftsmanship, quality and Italian-made products.

In this scenario, Gucci believes it is necessary to sustain and promote, within the company, along the supply chain and in the organisational and marketing process, a business growth model that combines excellent craftsmanship with the creation of ‘Sustainable Value’, that goes beyond the fundamental principle of compliance with every International Convention, Directive, Law, Regulation and/or applicable law and takes into account the economic, environmental and social interests of all stakeholders.

Gucci’s guiding principles

In line with its mission, code of conduct and the code of conduct of the Kering Group, Gucci is committed to implementing a Culture of Sustainability and to raising awareness within the Gucci system, i.e. amongst all parties with a legitimate interest in and/or who are affected by its activities: employees, shareholders, customers, suppliers, sub-contractors, commercial and financial partners, local communities, institutions, NGOs, trade associations and trade unions, thereby promoting a Policy that values the following principles:

• Business ethics
• Respect for human rights

Promotion of a quality working environment through:

• employment standards
• the protection and promotion of health and safety
• people’s welfare
• the development of professional skills
• the promotion of diversity
• Contribution to socio-economic development
• Supplier involvement

Customer care

Protection of the environment: Gucci believes that the commitment to the reduction of environmental impact and the protection of ecosystems and biodiversity are not only fundamental to the preservation of the planet and its inhabitants, present and future, but are also needed to ensure competitiveness, risk reduction and the further development of the business.

Gucci is committed to:

• reducing the environmental impact of its business operations with a special focus on the use of energy and water, waste production, hazardous chemicals and the sustainability of raw materials;
• identifying and assessing both direct and indirect social and economic environmental impact along the entire supply chain and promoting within its own spheres of influence actions for the improvement and development of support for people and their environment.

Relations with stakeholders

• with regard to all of its Stakeholders Gucci is committed to: developing and pursuing a dialogue with its stakeholders based on fairness and transparency, in the belief that they represent a key asset of the company which should be promoted and developed;
• joining initiatives or signing agreements for collaboration, cooperation and partnership with public and private organisations on the issue of sustainable development at local, national and international level.

Fur-free Announcement

Gucci announced a commitment to going fur-free on Oct 2017 that they will cease releasing fur product beginning with its spring 2018 collection and will continue to be supported by the Humane Society of the U.S. and LAV in ‘identifying and reducing its impact on animals and the environment.’

To be clear, the definition of ‘animal fur’ by which Gucci is subscribing means ‘any animal skin, or part thereof, with hair or fur fibers attached thereto, either in its raw or processed state or the pelt of any animal killed for the animal’s fur.’ That means mink, fox, rabbit, karakul lamb and raccoon dog are off limits, while lamb, goat and alpaca can still be used.

Gucci’s president said the evolutions “demonstrate our absolute commitment to making sustainability an intrinsic part of our business”.

III. Research methods used in the study

A. Description and rationale of research methodologies

B. Research Process

IV. Findings and conclusions of the study

A.Findings

“Fur Free” Luxury Brand List far too short

Gucci’s new fur free policy marks a game-changer for the whole luxury fashion industry to follow.

According to the PETA twitter information, there are only 18 brands have banned fur.

Youth don’t think wearing fur is cool

According to a 1,025-person survey of 18- to 34-year-olds, which asked respondents if they were comfortable wearing fur, 66% of millennials say they aren’t comfortable wearing it.

The survey employed by Mic.com, 70% of millennials say they wouldn’t buy a new clothing item made with fur.

Digital marketing matters

McKinsey reported that 80% of luxury sales are now influenced by online.

This is a staggering figure, and clearly highlights the important role digital now plays within a luxury purchase. It might be surprising, then, to know that digital revenue at the majority of luxury brands still contributes little in comparison to other sales channels.

It is now time for luxury brands to fully embrace digital.

Collectively millennials and Generation Z will represent more than 40 percent of the overall luxury goods market by 2025, compared with around 30% in 2016.

Unlike Baby Boomers, many millennial luxury consumers expect to interact with brands across a range of digital platforms, rather than only through traditional channels.

The future success of the industry will depend on its success in permeating and proactively reaching out to the younger generation. Luxury brands previously viewed social media as “mass market”, but today it has become an increasingly important marketing tool for them. The biggest challenge for luxury brands will be to make optimum use of social media without compromising their brand values. The success of a social media strategy will be converting “likes” into an interactive and engaging experience for customers.

B.Conclusions based on the findings

Based on all of the research conducted, it is clear that although Gucci has created a domino effect, a dozen of brands are not joining the anti animal killing movement, but still most of the other brands and companies are not ready to go fur free. Gucci needs to work more to help the world increasing awareness of anti animal killing.

As the luxury brand leader in terms either revenue, profit and corporate social responsibilities, Gucci is one of the best practice of embracing digital and thus beloved by millennials and generation Z. Young people and young designers don’t think wearing fur is cool and they are the power to promote awareness to stop killing animals globally.

V. Proposed strategic plan

Therefore, I am planning to initiate a one year global #GucciFurNotCool! Campaign.

By doing this, Gucci will be the first luxury brand showing a leading position by continuously spreading positive values against animal killing and fur selling.

A. Objectives and rationale of the proposed strategic plan

#GucciFurNotCool! Campaign aims to:

1. convene, unite and strengthen the voices of millennials speaking out for fur-free trade to raise public awareness for animal protection by using innovative approaches combined offline and online activities.
2. to influence more brands to join its movement, and together decrease animal killing significantly by the year of 2025.
3. Gucci will build up a long-term partnership with a non-profit organization like PETA and with social media giants etc. Gucci aims build up the brand image, popularity, and customer preference among the younger generations – the Millennials in a long term perspective.

B. Proposed activities and timelines

This campaign will be last for 1 years globally, especially in North American and Asian countries such as Canada, US, China and Japan. These are area where most fur products are consumed or most of the animals are killed for brands. Focusing on these areas will more effectively increase the public awareness addressing anti-fur selling and anti-animal killing.

The campaign consists a series of activities, events and challenges, they are all part of one single movement -Gucci’s Fur Free movement. Gucci will invite young people to get actively involved into these activities.

Introduction

This paper aims to analyze the structure, performance, strategies and external environment of Gucci, one of the most famous companies in the world.

The company overview will give an insight into Gucci’s history and achievements.

This section will be useful to understand the importance of this firm in its field and the position it has gained throughout the years.

The paper will continue with the definition of Gucci’s mission and vision. A strategy analysis will be conducted to understand Gucci’s values and the way it applies them to set its goals. In this section, it will be possible to acknowledge how the firm operates in the market remaining coherent with its beliefs.

Being Gucci a multi-business company, it supplies products in the sectors of clothing, accessories, jewelry, fragrances, and makeup. This report will focus on the clothing department of the company, to analyze and better understand the pillars of the main source of Gucci’s profits.

The external environment will be evaluated by taking into account both the general and the competitive environment, crucial in the analysis of the factors affecting Gucci. The definition of the industry in which Gucci competes will be essential at this stage, since the 6 segments forming up the general environment, affect each industry in a different way and extent. Here the issues of industry selection and the threats related to it will be evaluated.

In the analysis of the competitive environment, Porter’s 5 forces model will be applied to Gucci to understand its position in the market-wide environment. This will be carried out by evaluating the degree of influence that each of the five forces exercises on Gucci.

Further examination will be conducted by executing the SWOT analysis. This section will point out the strength, weaknesses, opportunity, and threats that Gucci must face within its industry. Furthermore, the detection of strategic groups will be included in this paper to understand the wider behavioral patterns (in strategic terms) of the luxury industry, in which Gucci competes in.

1. Overview

Gucci is an Italian company founded in Florence by Guccio Gucci in 1921. It is considered one of the most desirable luxury fashion brands all over the world, and it focuses on prestige and exclusivity.

Guccio Gucci was born in Florence in 1881 from a humble family; his father was an Italian artisan who made leather goods. As a teenager, he traveled across European capitals such as Paris and London, where he worked as a waiter, concierge, and lately as a maître. In 1897, Guccio Gucci worked as a lift attendant in the renowned and prestigious Savoy Hotel, where he was inspired by the elegance of the hotel’s guests. Gucci returned to Florence in 1921, where he used all his saving to open a small shop on Via Vigna Nuova. Gucci’s first store sold products- such as high-end luggage, shoes, gloves, and bags – that were made with high-quality leather crafted by the best local artisans. Gucci’s creations were inspired by horseracing. Success came quickly for Gucci, as his store became popular among tourists and the Tuscan nobility.

Consequently, due to higher demand, the store location was moved to a larger headquarter in Lugarno Guicciardini. During fascist period, Gucci’s production had to find different ways to import leather and other materials, thus the brand started to create its products with atypical materials- such as hemp, flax and jute- to overcome League of Nations embargo against Italy. In those years, Gucci manufactured the famous “bamboo-handled bag”, which was inspired by the shape of the saddle bag. In 1938, Gucci opened its first store on Via Condotti, in Rome. In 1951, Gucci’s opened a store on Via Montenapoleone, in Milan. Around this time, the green-red-green plot became the company’s official trademark. In 1953, Guccio Gucci died and his four sons inherited the company.

In that same year, another Gucci store was opened in New York City. In the 1960s, Gucci adopted the popular two crossed GG logo, and after that all of their productions- bags, luggage, leather goods and first pieces of clothing- were characterized by the presence of this logotype.

During the 60s, new stores were opened in London, Palm Beach, Paris, and Beverly Hills. Celebrities of that time -including Liz Taylor, Sofia Loren, Ingrid Bergman, Audrey Hepburn, Jacqueline Kennedy and Princess Grace of Monaco- were seen wearing Gucci’s designs. The brand’s popularity among celebrities contributed to further improve the company’s image and reputation. In the 70s, the company expanded to Eastern capitals, and stores were opened in Tokyo and Hong Kong. In 1974, there were over 14 stores distributed worldwide and a year after that, the first fragrance was launched. In 1982, the company was transformed into an S.p.A. company and leadership passed to Gucci’s grandchild Maurizio, who possessed 50% of the company. In 1985, Gucci’s legendary loafer was exposed at the Metropolitan Museum of Art in New York, where it became part of the permanent collection.

In 1987, an Arabic investment company, called Investcorp, bought the company’s shares when Aldo Gucci and Maurizio Gucci left the brand. After a few difficult years for the company, in 1994 Gucci’s director Domenico Del Sole appointed Texan stylist Tom Ford as the brand’s new creative director. Tom Ford revolutionalized Gucci’s image through remarkable marketing campaigns that made history. He re-introduced the iconic “bamboo bag” and the “horse bit clutch” bag; his first 1995 campaign was an enormous success and was merely focused on jet-set glamour. The Federation of European Economic Press named Gucci “company of the year” after Domenico Del Sole listed the company in the stock market in 1998. In 1999, Gucci became the property of the Kering S.A (called PPR at that time) which to this day controls the company. In 2004, both Del sole and Ford left the company due to contractual issues. Robert Polet was appointed as the new CEO of Gucci Group and Mark Lee became the company’s new CEO. John Ray and Alessandra Facchinetti took over men and women’s designs. Frida Giannini was promoted to the position of Gucci’s new creative director in 2006 after she smartly relaunched the Flora print. In 2006, Gucci signed an agreement with Procter & Gamble for the production and distribution of the brand’s fragrances. In 2009, Patrizio Di Marco became Gucci’s new CEO, succeeding Mark Lee. Frida Giannini also re-launched a new and modern version of the “bamboo bag” and the “Jackie O bag”. In December 2014, creative director for Gucci’s women’s ready-to-wear and accessories Frida Giannini and CEO Patrizio di Marco were requested to step down from Gucci. Kering’s Chairman and CEO Francois-Henri Pinault asked Bizzarri to become Gucci’s new CEO. In a statement, Kering declared that “Bizzarri will support Gucci’s brand elevation strategy to continue to strengthen the brand’s international growth; this leadership transition will not result in any change in the organization of Kering’s luxury activities”.

During the last nine decades, Gucci has played on its competitive advantage -through which it has created a new and distinctive line of items- to deliver quality products and consequently gaining market share. The company has constructed a refined concept of fashion, using charisma and intuition, but maintaining the original aspects of production.

Gucci’s company has expanded its activity all over the globe; sponsorship deals with A-list celebrities have contributed to grant the company international status and recognition. In addition, starlets and top models have worn the brand’s clothing, accessories, and shoes for high-fashion magazines editorials, raising brand awareness and reputation around the globe.

Among the various Italian fashion houses, Gucci is at the forefront of the digital market, according to the ranking drawn up by Contactlab and Exane BNP Paribas. The ranking analyzed the level of digital and cross-channel competitiveness of 34 fashion brands and luxury on a global scale. Kering, that has grown in 2017 reaching 6.2€ billion in revenues, has moved from the third place in 2018 to the first, on a par with Burberry, a label that held primacy for years.

Selecting the appropriate business approach and implementing the right strategy, as the new leaders Marco Bizzarri and Alessandro Michele did, helped the company to obtain the desired results. According to that ranking, the company has spread its image, successfully selling both traditional products, such as leather goods, and different accessories.

Moreover, Gucci has won several international awards, including ISO 14001 (Environmental System), LEED (Leadership in Energy and Environmental Design) and FSC (Forest Stewardship Council). This year, at the Italian Fashion week of Milan, the company has been awarded “brand of the year” and its CEO Marco Bizzarri was nominated “best leader”, for the third consecutive time.

2. Selection of a business

Kering is a conglomerate that administrates the development of some renowned labels: Saint Laurent, Bottega Veneta, Balenciaga, Alexander McQueen, Pomellato, Brioni, Dodo, Boucheron, Qeelin, Girard-Perregaux, Kering Eyewear, as well as Gucci. According to Kering’s official website, Gucci is the leading luxury brand that boosted Kering revenues; as a matter of fact, in 2018 Gucci alone made up for the 63% of Kering’s recurring operating income. As illustrated in Table 2.1, Gucci’s revenue peaked to 8 billion euros.

Table 2.1

Table 2.2 depicts the rank of the most valuable Global Brands.

In 2018, Gucci was ranked at the 4th position, reasserting once again its presence among the top five most prestigious luxury brands worldwide.

Table 2.2

Gucci operates on a multi-business level.

Italian fashion and leather goods brand produces and distributes a broad array of leather goods, shoes, watches, jewelry, fragrances, cosmetics, luggage, handbags, and high-end apparel. Among its many businesses (where “other” comprises of cosmetics and fragrances), leather goods represent Gucci’s most popular and most remunerative product category, as shown in Figure 2.1.

Figure 2.1

We chose to analyze Gucci because it is one of the most relevant worldwide brands, as well as Kering’s most lucrative label. Gucci’s most profitable product category is represented by clothing (leather goods, shoes and ready-to-wear) and for this reason, we chose to evaluate this specific business.

3. Strategy Analysis: mission, vision and strategic objectives

In any firm, strategic management is a key step to fill the gap between a firm’s values and ideas and their practical realization. The first element, the so-called “strategy analysis”, consists in identifying a common vision for the whole company, which will delineate a common direction, the big picture, the source of passion for the job; then, mission will arise, more concrete than the vision, and objectives, to be achieved in a specific timeline.

In the last decade, Gucci has been a great example of how great is the impact a good strategy analysis can have on the volume of sales. The company’s conduct changed since Marco Bizzarri became the new CEO in 2014 and Alessandro Michele was appointed as the new creative director in 2015; since then, Gucci has become extremely modern and more prone to experiment than its competitors.

Many elements of Gucci’s mission and objectives are presented to stakeholders and the vast public; such mission and objectives are periodically updated following Gucci’s Ethic code, written for the first time in 1996. The main vision statement is: to become a worldwide leader in clothing and accessories industries, in the field of luxury and of sport and lifestyle.

Another important vision statement is: “Empowering imagination”.

These vision statements reflect different missions and timely objectives, which are:

• Defend and promote creative people. For example, three years ago Gucci hired a graffiti artist called ‘GucciGhost’ to collaborate for the autumn/winter 2016/2017 collection; he was known online for his stylised ‘double-G logo’ tag. He was not extremely famous and he didn’t have a lot of experience in firms, but Gucci decided to experiment and praise his creativity.
• Customizing more products and online services. This was meant to make shopping more similar to an adventure, rather than to a simple transaction: Gucci’s online store shows a lot of wonderful pictures (see below) and offers free returns, find-in-store options, product information and gift wrapping; also, the website features ready-to-wear collections as curated as they appear on the runway. Creating an immersive and unique e-commerce experience, in a world characterized by globalization and online networks, is a brilliant strategy.
• Further working further on the “Artisan corner” project, by adding sections in every store where customers can see Gucci’s craftsmen in action and learn about past and present techniques of production. This mission is meant to show Gucci’s hidden aspects to customers, and especially the high skill and quality standards for their goods.
• Being more relatable and more friendly with the customer; the mission is not to sell a product, but to sell a dream, a lifestyle. “Forget how much it costs, and wear what makes you happy” is the slogan. To pursue this, Gucci is working hard on its appearance and the imagery associated with the brand, through Instagram posts, magazines, and the [image: ]official website.
• Strengthening the popular culture relationship. The mission of “selling a dream” is achieved, for example, by using celebrities, such as Lady Gaga and Beyoncé as testimonials. They have great visibility and, for most people, represent “the life of dreams”.
• Paying more attention to young consumers: This is part of the “more inclusive brand” mission, since, traditionally, luxury brands always target middle-age people, and Gucci has always projected an aura of exclusivity, while now the company wants to make “fashion for everyone”, including young people; for this reason, Gucci is working on a geek-chic aesthetic, which is very popular among millennials. Also, the company created the hashtag #TFWGucci (thanks for watching) on Instagram and Facebook, pairing funny images with pictures of their products, with humorous captions. In order to understand and meet the desires of young adults, Gucci created a committee called “Shadow Comex,” which is made up of people around 30 years old: this young team is deeply involved in strategic decisions, and the CEO discusses with them the same topics that he discusses the “traditional”, main executive committee (the Comex). So, another mission for Gucci today is to obtain the feedback of millennials and show them that luxury fashion is for them, too. This strategy seems to be working pretty well since it allowed Gucci to reach many objectives: for example, in the third quarter of 2017, sales spiked by 49%, hitting $1.82 billion. Today, young adults aged between 18 and 34 years old account for more than half of Gucci’s consumers.
• Working on environmental sustainability. Gucci affirms that it’s their duty to use their position as a luxury brand to pioneer and promote sustainability; this is linked to the focus on young adults because millennials care a lot about environmental issues. Gucci began to work in this direction in 2004 and in June 2010, the company introduced 100% recyclable packaging; last year it started its fight for animal welfare by joining the Fur Free Alliance, along with other luxury brands. Fur products were worth only about €10m annually in revenues to Gucci, so the financial impact was limited.
• Corporate Social Responsibility. Gucci focuses a lot on the human aspect of their business and is fighting for employees’ rights, gender equality in the workplace and fashion industry, empowerment of local communities and against the exploitation of child labor. The company created the “Kering foundation against violence on women” and joined Global Compact in 2008.
• Defend diversity, which means introducing new styles in all categories with no gender-specific pieces, for example. This is, according to the current CEO, the key to promoting respect and to create a sustainable business.

4. The External Environment

The external environment can affect a business widely, therefore it is necessary for the firm to analyse it peculiarly, in order to exploit all possible opportunities and to best deal with the potential issues that may arise. To do so, firms monitor, scan and forecast the external environment they compete in. At this stage, Gucci will analyze its industry characteristics such as concentration level, competitors’ market shares, the presence of substitutes, product differentiation among rival firms, etc. Constant surveillance of such factors will be necessary to respond promptly to any changes and shocks that could affect the brand. This analysis will lead to the understanding of the general and competitive environments Gucci operates in.

General environment

The sector of Gucci we are analyzing belongs to the clothing industry, however, being Gucci an haute-couture brand, it must also be located in the luxury industry. This differentiation is important to be made when assessing the general environment since the 6 segments in which it is divided -demographic, sociocultural, political, technological, economic and global- vary depending on the type of industry the firm competes in. The first difference that must be highlighted is within the economic aspect. Economic downturns, for instance, would certainly affect the clothing industry: in fact, during a period of economic contraction population has less disposable income and will give priority to necessity goods such as food, mortgages, education, healthcare etc. rather than to new clothes. However, the luxury industry generally addresses to a wealthier customer base, which is usually less affected by economic crisis. In the same way Gucci, as part of the luxury sector, is less threatened by shocks in variables such as GDP trends and consumer price index (CPI) changes. On the other hand, it must be said that, as Gucci is on the stock market as part of the Kering SA group, it is affected by other economic and global variables such as changes in the stock market, global trade trends and agreements.

Another key segment affecting Gucci is the socio-cultural aspect. Being a textile business, Gucci has to deal with external pressures coming from three different groups: women’s rights activists, environmentalists, and human rights activists. To anticipate and manage potential protests and reputation-damaging problems, Gucci must not underestimate these external threats. As a matter of fact, there is evidence supporting the fact that Gucci’s managerial department has given this kind of issues the right importance.

Like any other clothing firm, more than half of Gucci’s employees (59%) are women. According to the New York Times, Kering group announced a new parental-leave policy that grants a minimum of 14 weeks of paid maternity or adoptive leave and five days of paternity or partner leave for all employees who have worked there for more than a year. This policy, of course, includes Gucci. Further evidence shows Gucci’s efforts in salaries’ equality. Table 4.1 and Table 4.2 show that the slight higher average male pay is, at least in part, compensated by a higher proportion of bonuses assigned to female employees, presenting, in the end, an overall fairly equal pay.

Table 4.1

Table 4.2

Tables 1 and 2: equilibrium.gucci.com

For what concerns the threat of human rights activism, Gucci has taken further action after the 2014 scandal, that saw Gucci accused of exploiting Chinese workers in the production of handbags. Gucci has then declared its intention to increase control on its suppliers. Such a scandal is proof that human rights and ethnicity issues are to be considered important when dealing with sociocultural effects from the external environment.

Lastly, as textile industry, Gucci has to deal with the impact on the environment, therefore keeping an eye on waste and emission thresholds is another key element to avoid incurring into sanctions or environmentalists protests that could threaten Gucci’s reputation. As a matter of fact, Gucci has an updated website showing environment-friendly goals and achievements. The following table is an example from such a website.

Table 4.3

Competitive environment

The other branch of the external environment analysis concerns the competitive environment. The best way to evaluate it is through the close study of Porter’s five forces.

Gucci’s Porter’s five forces analysis

• The threat of new entrants: is relatively low.

The luxury industry is quite concentrated, with the top 10 companies making up for almost 50% of total sales. Furthermore, all brands have an extremely high image and well-known names, making it hard for a new entry to stand out and establish itself in the market. Another factor playing against newcomers is that haute-couture is one of the most expensive sectors among industries, therefore a substantial initial capital investment is needed. The fact that economies of scales are highly recommended in this business, makes the barriers to entry even tougher to overcome. In conclusion, Gucci does not face a great threat from new entrants.

• Suppliers’ bargaining power: high.

The supplier bargaining power depends on the brand’s ability to raise prices and lower quality of goods without losing profit. Gucci’s brand image is so well established that even if the company raised prices or reduced the quality of its couture, the majority of their customers would still buy from them.

• Buyers bargaining power: low.

Gucci’s clientele is likely to be generally wealthy, therefore customers are not ‘price sensitive’ and cannot force prices down. Furthermore, businesses in the luxury industry are more concentrated than buyers, who are therefore left with no bargaining power.

• The threat of substitutes: high.

Within the brands in the luxury industry, the level of prices for a similar product is also similar therefore the customer’s cost of switching brand is low. The threat of substitutes also comes from the wider fashion industry, where medium level couture is gaining market share. Customers are showing interest in similar-looking but cheaper products, becoming an additional threat for the higher level industry in which Gucci competes.

• Rivalry among existing competitors: high.

As mentioned above concentration in this industry is fairly high, 47,2% (concentration ratio of top 10 companies) with a few leading brands or groups heading the market. This oligopolistic-like environment sets the basis for higher levels of rivalry among existing competitors. Furthermore, substantial barriers to entry and high operating expenditures make it difficult to leave the market (barriers to exit), leaving the already performing firms threatening each other. Gucci’s strength on this aspect is product differentiation, which gives it a strong brand image and reduces rivalry, at least, on its highly differentiated products.

Clothing comes at various qualities and prices; Gucci is well known to be a luxury brand, famous for the excellent but expensive products that it offers on the market. Other companies that adopt a somewhat similar strategy are, for instance, Chanel, Versace, Balenciaga, Dior, Hermes, Armani, D&G, LV, and Burberry.

All these companies play on the uniqueness and sophistication, the “added value” of their product, which explains the higher price. Furthermore, they rely a great deal on fame and reputation.

This inextricable dependance means Gucci and suchlike companies invest large sums of money on brand image and trademark to build goodwill. This is one of the major weaknesses of the company.

This inextricable dependance means Gucci and suchlike companies invest large sums of money on brand image and trademark to build goodwill. This is one of the major weaknesses of the company. [image: ]

Nevertheless, it is necessary to guarantee one of their greatest asset: strong brand recognition. This, along with grade-A clothing, ensures celebrities buy from them, which entails notoriety; this is a huge opportunity, especially because famous people set trends, and as a fashion company, Gucci must keep up with the latest tendencies. One of them is the need for sustainability, that is revolutionizing the entire world, not just the fashion industry: this is good news and bad news because it offers the possibility for the industry to reinvent its products, but it also implies research and higher costs.

Gucci’s turnovers, what with it operating worldwide, are indissolubly tied to the state go the global economy and business cycles. Of course, among the greatest threats for this business, there is also competition; this much can be said about any firm.

All in all, Gucci’s health as a company is at a very good level.

Since fashion never ends, it evolves with the time and it varies depending on the place, if Gucci keeps in tune with what is in vogue and implements effective management and strategies, it will profit from all the opportunities that the ever-changing global economy and fashion industry will provide.

References

Journal articles

1. ABS-CBN news. 2014. “Gucci accused of exploiting Chinese workers”. URL: https://news.abs-cbn.com/business/12/23/14/gucci-accused-exploiting-chinese-workers
2. ‘Con Gucci, Prada e Valentino la moda italiana trionfa ai Fashion Awards 2018” https://www.ilsole24ore.com/art/moda/2018-12-11/con-gucci-prada-e-valentino-moda-italiana-trionfa-british-fashion-awards–111143.shtml
3. ‘Gucci guida la leadership digitale dei marchi italiani” https://www.pambianconews.com/2018/05/29/gucci-guida-la-leadership-digitale-dei-marchi-italiani-237152/
4. “Gucci organization and strategy – Case 1”: https://www.disag.unisi.it/sites/st07/files/allegatiparagrafo/16-10-2017/case_1_gucci_organization_and_strategy_2017.pdf
5. “Innovating sustainable fashion”, report by: Clio Gydé & Christina McIntosh Kaisi Rosin Lena Melin & Walter Götsch: https://innovatingsustainablefashion.files.wordpress.com/2012/07/group_1_gucci.pdf
6. “Marketing theory and practice – Gucci”, report by: Kakhimora Tokhira: http://www.academia.edu/11757905/Marketing_Theory_and_Practice_Gucci
7. “Meet the man who made millenials fall in love with Gucci”, article by: Elizabeth Segran: https://www.fastcompany.com/40517585/meet-the-man-who-made-millennials-fall-in-love-with-gucci
8. “The poetic reactivation of Gucci”, article by: Stephen Doig: https://www.polimoda.com/the-poetic-reactivation-of-gucci/
9. Valeriya Safronova. 2016. “Kering’s Latest Luxury: A Generous Parental Leave Policy”. The New York Times. URL: https://www.nytimes.com/2016/12/19/fashion/kering-maternity-parental-leave.html
10. La stampa. 2016. “Made in where?” URL: https://www.lastampa.it/2016/01/30/societa/madein-where-Hs2i7LQDf7GWYOogeeR7UM/pagina.html
11. Wall street Italia. 2014. “Gucci: ma quale Made in Italy, “sfruttano forza lavoro dei cinesi.” URL: https://www.wallstreetitalia.com/gucci-ma-quale-made-in-italysfruttano-forza-lavoro-dei-cinesi/

Websites

1. A talk with Marco Bizzarri”: https://www.businessoffashion.com/articles/ceo-talk/ceo-talk- -marco-bizzarri
2. Deloitte. “Global powers of luxury goods 2018”. PDF. URL: https://www2.deloitte.com/content/dam/Deloitte/global/Documents/Consumer–Business/cb-global-powers-luxury-goods-2018.pdf
3. “Gucci: A History Lesson” https://wwd.com/fashion-news/designer-luxury/history-lesson-3512770/
4. “Gucci – About”: https://www.indeed.com/cmp/Gucci/about
5. “Gucci marketing strategy”, article by: Monique Danao: https://www.referralcandy.com/blog/gucci-marketing-strategy/
6. Gucci official webiste: https://www.gucci.com/
7. Gucci. “Report ambientale”. URL: http://equilibrium.gucci.com/it/ambiente/le-nostre-prestazioni-ambientali/report-ambientale/
8. Gucci. “Publication of gender gap in Gucci limited”. PDF. URL: http://equilibrium.gucci.com/wp-content/uploads/2018/05/B1.4-Gender-Equality-and-diversity-in-the-workplace.pdf
9. ‘Gucci Success Story” https://successstory.com/companies/gucci
10. “Gucci unveils plan to become fur-free from 2018”: https://www.ft.com/content/9b36505c-af1b-11e7-aab9-abaa44b1e130
11. “Hottest Fashion brands” https://www.businessoffashion.com/articles/news-analysis/gucci-worlds-hottest-fashion-brand-while-prada-cools-advertising-spend-editorial
12. “How Alessandro Michele made Gucci great again”: https://www.thenational.ae/arts-culture/how-alessandro-michele-made-gucci-great-again-1.200356
13. ‘The Great Guccio Gucci” http://www.caftours.com/magazine/great-guccio-gucci/
14. “THE HISTORY OF ITALIAN FASHION: GUCCI” https://www.cameramoda.it/en/associazione/news/915/

Renowned for the excellent quality and luxurious style of the items sold, Gucci perfume stores are popular all over the world. Solid and innovative approach to the marketing and branding procedures preconditions high rate annual revenues of the company in the fragrance industry all over the world. In the following assessment paper, the current strategy and situation in Gucci perfume stores will be observed in detailed.

Current Gucci Perfume Stores Strategy

Gucci perfume stores philosophy is reflected in the following quotation, “quality is remembered long after the price is forgotten” (qtd. In Moorcroft 2004). In connection with the above-mentioned statement, Gucci perfume stores strategy is based on the idea that quality is crucial in giving a customer an idea of brand while price is not the most important variable. Thus, the company targets a category of financially secure and ambitious customers ready to invest in their image and knowing the price of luxury. Gucci targeted customer category is women between twenty and thirty belonging to the get set lifestyle or wishing to demonstrate their association with this category (Arrigo 2011).

Gucci perfume stores management bases the network strategy on the concept of distinctiveness and exclusivity among the target category of buyers. To promote company elitism, the leaders have designed an image of Gucci customer characterised by vibrant appearance, sexual appeal, and ambitious stance (Fig. 1). The image is widely represented in the media and shopping malls through massive advertising companies, innovative approach to marketing, and the whole experience of shopping with Gucci perfume stores. The aura of prestige communicated through the Gucci image gives added customer value to the products sold in Gucci perfume stores since consumers are ready to invest additional funds into associating themselves with the picture of success, sexuality, and exclusivity the brand is depicting (Arrigo 2011).

Gucci perfume stores interior design (Fig. 2, Fig. 3) is an essential attribute of Gucci image according to the company leaders (Arrigo 2011). For that reason, every single detail of store design is taken into account by the top management. The company strategy includes the following essential components of Gucci perfume stores decoration and operation worldwide: (1) location on expensive high streets or at the best shopping malls in a city; (2) provocative decoration of the window displays; (3) visually appealing interior with a free flow layout; and (4) comfortable consumer browsing of collection on exhibit. Apart from rich classic decor, the company concept includes standardised requirements to the store employees. All of them should meet the highest requirements to their appearance, they should be smartly dressed in clothing of dark colours, and their outfit is to feature high quality makeup. To conclude customer experience, distinctive packaging is utilized. All Gucci perfume stores are directly operated by the world headquarters in order to ensure strict control of the company image implementation.

Current Situation

Current business situation for Gucci perfume stores is favourable which can be seen from the following figures. According to Global Fragrances and Perfumes Industry (2013), Gucci perfume stores annual revenue in 2012 was $1552.6 million in the United States and internationally it exceeded $4464.4 million. In 2013, the U.S. market demonstrated 18% growth for the company and the international market maintained the rates of the previous year (Global Fragrances and Perfumes Industry 2013). The increase at the American market is traditionally observed in the women’s sector. Nonetheless, the company was surprised to register the growth at the men’s sector that year (Men’s fragrance sales soar in the UK and US 2013).

The key to success of Gucci perfume stores is exclusivity along with distinctiveness. The company works with the best designers, the most innovative developers, and the most ambitious and risky marketers. To illustrate, Gucci advertising company of ‘Opium’ perfume became one of the most controversial in Britain due to the use of a naked image of Sophie Dahl. Despite the uproar in society, the perfume company was a great success and won a number of prestigious awards in European advertising competitions (Arrigo 2011). Another example of Gucci advertising strategy is the advertisement in Vogue magazine with an image of a naked lady having the letter ‘G’ depicted on her private parts. The use of this audacious advertising solution helped Gucci boost customer awareness of the brand as well as ensure wide media coverage. Another winning strategy the company is utilizing is involvement of top stars from popular industry and designer community.

References

Arrigo, E. 2011, “Fashion, Luxury and Design: Store Brand Management and Global Cities Identity”, Symphonya, no. 1, pp. 55-67.

‘Global Fragrances and Perfumes Industry’, 2013, PR Newswire, viewed 02 May 2014, via ProQuest Central Academic Database.

‘Men’s fragrance sales soar in the UK and US’, 2013, Telegraph, viewed 02 May 2014, via ProQuest Central Academic Database.

Moorcroft, R. 2004, “Quality remembered when price forgotten”, The British Journal of Administrative Management, no. 1, pp. 4.

Introduction

In the contemporary world, both teens and young adults tend to identify themselves with particular brand names in the clothing sector. This is basically because they believe that, it promotes a certain image to them as individuals. One of the most common brand names is “Gucci”.

This company is often referred to as the House of Gucci or just Gucci. It is famous for its luxurious designs in both clothes and accessories that are coveted globally. The original designer of the Italian fashion house was Guccio Gucci and the company logo thus consists of the ‘G’ letter. Two ‘G’ letters face each other interlocked in such a way that, one ‘G’ is reversed.

The teens and young adults today perceive attires from the Gucci Company, as the ‘main thing’ that makes them look classy and cool by virtue of the company’s good reputation and fame. This classy and cool image they acquire in wearing Gucci clothes can be said to have been created by both the company advertising, and the Gucci users themselves.

The Connection between Advertising and Cultural Values

Advertising and particular cultural values connect in such a way that, the way a product is advertised ought to be in line with cultural values for it to be accepted and sold easily. According to Hovland, advertising often impacts the choice of brand customers decide to utilize versus the advertisement’s capacity to add the product’s generic demand.

The way a certain product is advertised plays a big role in fostering the standards of a certain product. However, it is still uncertain as to how much advertising remains a reflection of what already exists, or it actually sets standards that are followed by others. Even in the Gucci Company, it is paramount that its adverts utilize values as well as symbols relevant to teen’s culture.

Despite the fact that advertising may reflect the already existing culture, the fact that it reflects can actually shape culture because there is no equal reflection for everything. It is therefore true to say that, as much as advertising reflects on certain cultural values, it is very selective on this because it echoes as well as reinforces certain behaviors, attitudes and values more frequently than others (Hovland 164).

Impact of Advertising on Brands and young Adults

The cultural values of teens or young adults ought to be in line with a particular urge to be cool and classy at the same time. This has largely been identified with the way the Gucci clothing is advertised to make the consumer feel that its products are classy and most cool in the fashion trends. It is thus very crucial that an advert attracts customers to buy its products, and also that these products also meet the standards claimed in the advertisement.

As much as its adverts are good, the Gucci clothing can be said to have acquired merit in that, they have quality products that have over years gained much reputation. The young adults tend to have a culture of coolness, they want to have and wear the latest designs around and not just any imitations there is. It is because of inter alia, such cultural values within the young generation, that the Gucci Company has increasingly gained market for its clothing.

Conclusion

In a nutshell, the teens and young adults of today love the Gucci brand name when it comes to clothing. This is because the youth have over time developed a culture to always be fashionable and cool, at the same time to be classy or original as the Gucci clothing depict. The youth thus believe that, wearing the Gucci products promotes this image of coolness and class.

This is something created by both the existing cultural values of young people, as well as the influence of advertisement such as Gucci. The two factors therefore connect in bringing interest to young customers in purchasing Gucci clothing.

Works Cited

Hovland, Roxanne. Advertising, Society, and Consumer Culture., New York: M.E Sharpe, 2010.

Marketing research question

The major marketing research question is “Can an AVR based promotional game in Gucci catalog magazines increase catalog readership?”. This major research question would be assessed through other minor research questions such as “What are consumer’s attitudes towards promotional games in catalogs?”. “Have consumers experienced catalog promotional games before”, “What qualities would make a promotional game interesting?” and “Can promotional games lead to increased customer purchases?”

Criteria for selecting survey methods

Sampling issues need to be top in the list in terms of determining whether the questions can be answered or not. This is normally determined by the nature of information required from the respondents and the kind of access the researcher has to them. This research should target fashion retailers who use AVR technology. In order to ensure that the participants have those qualities then the organization should consider doing stratified sampling.

This refers to a method of sampling which focuses on a set of the population that possesses certain qualities. It then selects participants randomly from that sample in order to have a suitable number of representatives taking part. These concerns of having the right individuals should definitely play a major role in ensuring that things go according to plan.

Bias issues also need to be considered when selecting the survey method. Some consumers would want to appear socially desirable so chances are that they may make the concept of promotional games in magazines look good when it really is not. Also, since the questions will require physical viewing of the catalogs then the participant may actually need to interact with the researcher and this may increase biases.

Lastly, one must consider the content of the questions asked. In this case, the research is trying to find out something about a relatively new addition in the market. Some respondents may not know about promotional games in catalogs so related questions would not be appropriate to them.

Survey method to be used

The most appropriate survey method would be personal interviews through the use questionnaires. This method was identified because the nature of the questions is such that it requires one on one interaction with the participant – consumers need to look at certain catalogs and ensure that they rate them. Additionally, the method is likely to yield higher response rates and also allows the concerned interviewer to assess whether the right respondents was actually filling in the answers.

They will ask for clarification directly in case they do not understand the questions. On the other hand, this method requires prior preparation through calls in order to set up appointments and may take up a lot of logistics for all 217 participants. It also does not leave room for additional findings from customers who have more helpful material to Gucci.

Sample

Margin of error=Standard deviation/√(number of respondents)×1.96.

0.95=2/√(number) ×1.96.

√number=2×1.96/0.95=4.12.

Measuring scale in : Thurstone scaling.

Likert scaling.

Rasch model.