Gucci Case

Good Essays
Group A
Anna Abrell, Lottie Batchelor, Ankita Choudhary, Yuou Du, Marianne Halmela, Martin Zirfas

Table of Contents
!
" Gucci’s strategy!
" The luxury goods sector!
" Gucci SWOT analysis!
" Strategic group analysis!
" Future predictions

Is Gucci good at strategy?
!
" When Tom Ford was in charge, the business was more design-focused & control was centralised - there were disputes between Tom & De Sol regarding managerial control
" With the appointment of Robert Polet, control became decentralised and each brand was given direct control over its label & appointed relatively unknown designers # very controversial move
" PPR bought back the 20% stake that LVMH owned, acquired more brands and entered into franchising " Although some brands in the Gucci Group portfolio are not very profitable, they still have a high brand equity, which contributes positively towards the strategic advantage
# Although Gucci’s strategy was controversial and risky at the time of its conception, it has influenced current businesses and helped the company become more profitable
# Gucci is good at strategy

The Luxury Goods Sector
Products

Apparel, leather goods, shoes, fragrance, cosmetics, jewellery, watches
# Accessory spending to experience most growth, whilst watch & cosmetics consumption has slowed (Bain & Company, 2013)

Geographic scope

USA, Europe, Central & South America, Asia, Middle East

Buyers

High-class & middle.class. Intelligent, individualistic individuals with strong values & principles. Are demanding, have high expectations & a disposable attitude. (Okonkwo, 2007)

Competitors

Kering, LVMH, Richemont Group, smaller niche brands (eg Goyard)

Suppliers

Specialised, often family-run production sites – but also factories in Asia & Middle-East

Substitutes

Wines & Spriits

Potential entrants

High-tech luxury goods

Level of profitability

Revenues expected to grow 50% faster than global GDP
4-5%

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