DOES GUCCI NEED FIXING?
- Kering, owner of Gucci, Balenciaga, Saint Laurent and other brands, reports first-quarter financial results on April 20
- Last quarter, Gucci’s sales underperformed, amplifying concerns about slowing momentum at the brand
- Last week, Gucci, which turns 100 this year, showed its latest collection, which included a collaboration with Balenciaga
Where LVMH, Prada and other luxury giants seem to have the post-pandemic wind at their backs, Gucci risks being left out of the party. It partly comes down to timing: Gucci dominated the end of the last decade, but momentum was starting to flag by early 2020. The pandemic wasn’t the best time for creative director Alessandro Michele to debut a new direction for the brand; a collection launched via a series of short films drew plenty of attention, but sales dipped in the fourth quarter. The temporary halt to global tourism took a big bite.
To be sure, Gucci still ranks second in Brand Finance’s annual ranking of the world’s most popular brands, behind Nike. And Michele is an expert at using that clout to draw attention to his creations; last week’s show, with its Balenciaga “hack,” was an online sensation the likes of which few other brands can match.
The Bottom Line: Gucci’s latest collection appropriately had a “rebirth” theme. Kering, which relies on Gucci for a majority of its revenue and profits, is no doubt hoping Michele’s latest stunt proves as effective at drawing consumers to stores as it did at drawing online views.