Topics: Gucci, Chief executive officer, PPR Pages: 5 (1293 words) Published: September 12, 2013


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12 September 2013


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1. Gucci's Growth Gear.................................................................................................................................... 1

12 September 2013



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Gucci's Growth Gear
Author: Zargani, Luisa Publication info: WWD 205.58 (Mar 21, 2013): 1. ProQuest document link Links: URL to local SFX server: Full text: Gucci's Growth Gear ROME -- Sitting under the embellished wooden beams of the 16th-century Roman palazzo Alberini that houses the Gucci headquarters, the brand's president and chief executive officer Patrizio di Marco is brimming with optimism. "Gucci's potential has yet to be realized; there is still a long way to go," said di Marco. Four years into the job, after a comprehensive upgrade of the label, refocusing on heritage and artisanal and Italian craftsmanship, di Marco has helped boost Gucci sales to 3.64 billion euros, or $4.66 billion, up 60.6 percent from 2.26 billion euros, or $3.14 billion, in 2009, when he joined the brand. Compared with 2011, revenues last year gained 15.8 percent from 3.14 billion euros, or $4.36 billion. In 2012, earnings before interest, taxes, depreciation and amortization climbed 17.7 percent to 1.26 billion euros, or $1.61 billion, compared with 2011. Recurring operating income rose 18.9 percent to 1.12 billion euros, or $1.43 billion, in 2012, compared with 948 million euros, or $1.32 billion, the previous year and was up 82.2 percent compared with 2009. Dollar amounts have been converted at average exchange rates for the periods to which they refer. Looking ahead to the next three years, di Marco said those brands that "know how to talk to their customers will be the winning ones. This is the real challenge." As part of the Forever Now project, initiated in 2009, Gucci's "artisan corners" traveled around the world with company craftsmen showing their production skills. "I'm thinking of regrouping their stories to run on our Web site," said di Marco, noting the company has held 25 to 30 events a year. The "artisan corners" also helped to deliver a message di Marco considers fundamental:"Customers increasingly ask for personalized products and we will continue to emphasize this. The message is that Gucci is big but it still has artisans that create for you and you alone." With global expansion, companies are obliged to meet the needs of a wide range of customers, yet at the same time, local expectations are high. "I don't really like the word 'glocal,' but it is key. We offer a consistent approach and recognizable offer, but it is differentiated depending on the local situation. Individuality now is the variable which we need to tackle," di Marco underscored. In 2012, the Asia Pacific region remained the group's main market, accounting for 37 percent of sales and gaining 5.5 percent. Western Europe represented 27 percent of revenues, climbing 9.2 percent, followed by North America, which accounted for 19 percent of sales and increased 13.4 percent. Di Marco said there are "important market segments in the U.S. -- a beautiful market -- that have matured," he said, before adding, "[But] we should emphasize who they are as individuals and not part of a group. This transforms the way to approach them." Japan accounted for 11 percent of sales and grew 5.3 percent. All categories showed growth last year. Leather goods accounted for 59 percent of sales, up 15.4 percent compared with the previous year, remaining the group's core business. Footwear is the second category, accounting for 13 percent of revenues, up 15.8 percent, followed by ready-to-wear, representing 12 percent, and up 13.6 percent. 12 September 2013 Page 1...
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