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  • Writer's pictureNikhita Harne

Gucci in Decline

In January 2015, Gucci made the most dramatic reversal in a decade in the luxury industry with maximalist designer Alessandro Michele joined on board. With Michele’s creative vision and Marco Bizzarri (chief executive), annual sales doubled to $11.6 billion by the end of 2019. And it was quite simply a first in the field of modern luxury.



However, the slow growth predating the pandemic has led to a steep decline in the brand’s trajectory, falling at least 10 percent in a year. And while the decline is roughly in line with the estimates for the global luxury category overall, Gucci has not managed to rebound like other influential brands in the same category.


Brands like Hermes and Kering have seen returned growth, with LVM fashion division growth being accelerated to nearly 18 percent year-on-year. Others such as Yves Saint Laurent, Alexander McQueen saw a modest growth ranging from 0.5 to 2 percent.


But can Gucci’s decline be solely attributed to the arrival of the pandemic? If the underlying weakness is in the brand’s market positioning and strategy, it would be very hard to investigate. The pandemic however has had an impact on the brand as it relies heavily on selling to tourists in its European market. With its target market comprising of international visitors from China and the Middle East, Gucci finds itself having to appeal to a new audience to survive.


Back in 2015, Gucci undertook a radical transformation with its approach to merchandising and marketing. They produced their eye-catching fashion across price points, selling their merchandise to a new audience filled with young social media-savvy shoppers. But this deterred the more sophisticated clientele who were the foundation of the luxury brands.



Though it appears that Gucci is devising a new plan by reverting to a classic aesthetic of the 1950s and the ’60s, all while continuing its delivery of novel and bold design. Last year, the luxury brand’s biggest launch was its classic reissues of the Jackie shoulder tote and the Horsebit line of satchels, however, the collection was being sold alongside bags and clothes emblazoned with images of Donald Duck, courtesy of the brand’s collaboration of Disney. Presuming this new strategy pulls of Gucci might be able to restore its momentum all whilst catering to a wide audience with various elements, emerging as a completely novel luxury brand.

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