Gucci Group, N.V. Case Essay

4) Based on your positioning strategy, what brand name and marketing budget allocations would you advise?

This expansion demonstrates how the luxury industry is now run by massive corporations whose focus is only on growth, visibility, brand awareness, advertising, and most importantly, PROFITS! With growth and expansion, has come a decrease in quality and rarity. The luxury garments produced are mostly not handmade but are even outsourced to large factories in places such as China and Turkey. Also, to meet quarterly turnover projections, “designers churn(ed) out increasingly trendy collections of clothes, handbags, and shoes.” (Thomas, Pg. 246) With hundreds of new stores around the globe the surplus of designer labeled merchandise is immense hence, the proliferation of outlet malls.

In luxury marketing, there is a delicate relationship between 4 factors that most strongly influence the purchase of the luxury consumer. They are the exclusiveness of the brand, the reputation of the brand, forms of distribution and price/value affiliation. Exclusivity cannot always be ensured due to immense competition. But by consequence, it is not the key requirement of a luxury consumer. The consumer bases their

CRITICALLY CONTRAST THE KEY ELEMENT OF GUCCI’S MARKETING STRATEGY TO ITS CLOSEST COMPETITOR. JUSTIFY WHY YOU HAVE CHOSEN THIS COMPANY AS GUCCI’S CLOSEST COMPETITORS

From consumer’s perspective, the motivation of their purchasing high-end products is complicated. According to the report of Mintel (Academic.mintel.com, 2013), which showed that the reason why a large number of customs have purchased luxury merchandise in UK. There were 44 percent of female interviewees and 48 percent of male interviewees bought high-end goods due to the good quality. In addition, 31 percent of men and 18 percent of women consider the sophisticated technique

Gucci was founded in 1921 by Guccio Gucci. In 1938, Gucci expanded and a boutique was opened in Rome. Guccio was responsible for designing many of the company's products. In 1947, Gucci introduced the Bamboo handle handbag, which is still a company mainstay. During the 1950s, Gucci also developed the trademark striped webbing, which was derived from the saddle girth, and the suede moccasin with a metal horsebit. The Gucci group really said it all, Tom Ford, creative director and Domenico de sole, president and CEO, stood side by side facing the camera with eyes of steel. These two men had, in the first six months of 1999, been the centerpiece of one of most higly contested hostile takeover battles ever seen on the Europian

The author who inspired the topic of this thesis is Dana Thomas. As a fashion writer, Dana Thomas, has analyzed the changes in luxury fashion business. Thomas has been writing about fashion for the past twenty-five years in various journals such as Newsweek, The New York Times Magazine, New Yorker, Harper’s Bazaar, Vogue, Financial Times, and more. Dana Thomas’ two books, Deluxe and Gods and Kings, are the inspiration for this thesis. Deluxe: How Luxury Lost Its Lustre goes into great detail the secrets of the leading luxury industry brands, namely Prada, Gucci and Burberry, to showcase the “New Luxury” of today and how “luxury lost its luster” by featuring the manufacturing and logistical processes. Thomas exposes that many luxury brands use the same Asian factories that mass-market retailers employ, which raises questions concerning quality and craftsmanship for luxury brands.

LVMH, known as Moët Hennessy • Louis Vuitton, is a French conglomerate and the largest producer of luxury goods in the world. LVMH was formed in 1987 with the merger of Moet et Chandon a champagne manufacturer, Hennessy a cognac manufacturer, and Louis Vuitton a fashion house.

When consumers are buying makeup they want to know the value of the product. A consumer knows that when buying a product from a drugstore it is cheaper so this way all the products are each under twenty dollars. However , they might be cheaper but the fragrance might not always smell the best. Not only is the fragrance not the best, but the packaging is not always pretty. On the contrary, consumers also know that buying from a higher end brand and store the prices are dramatically higher but know it is worth it. Unlike drugstore makeup, the fragrance and packaging smell and look elegant. For people who love makeup, most agree that paying for “luxury beauty items” are willing to pay extra money because they know it’ll be worth it .Due to this obvious fact, most of the consumers do not care for how much it is as long as they know the value of the product is very high in satisfaction, they will invest in the product.

In nowadays, buying luxury brands is not only showing a sign of wealth, but also a kind of rewards for people’s hard working. Luxury products sell high market prices because of their designs, brand names, and the qualities. People want to buy luxury products because their quality is better than target brands. For example, the brand like Bottega Veneta is known for its traditional design of leather goods; their handbags are handmade in Italy. Comparing to Bottega Veneta to target brands, Bottega Veneta’s design will not easily out of style, but target brands will easily out of styles because their designs are relatively ordinary. However, in the recent year, some luxury brands’ reputation has gone done because those brands were shifting their factories to other countries and then shipping back to Italy just for the label. Technically, the phrase “Made in Italy” is not really manufacture in Italy anymore, sometimes this product 's qualities are not as good as before. There is a rising concern of whether these luxury goods really match with the expensive price tags.

Degree of Rivalry: The degree of rivalry is moderate in the global personal luxury goods industry. The industry is very concentrated and occupied by few large players. These companies do not need compete with price; however, they have high overlap of products’ category. Most of companies have several common characteristics. They have long history and start business in Europe areas; they all provide exclusive products and services backed by their brands; and they all served few amount of wealthiest customers over the world.

Maintenance of the brand image is always the fore most important factor for the luxury brands in order to sustain in the market. is very critical. Therefore, of all the criteria mentioned above, we have determined the brand image is the most important criterion on which we will base our recommendation.

Gucci is a multinational fashion brand based in Italy. The brand specialises in leather goods, clothes, and fashion accessories for both and women aged between 24 and 30 years. Gucci was founded in 1921 in Florence, Italy by Guccio Gucci (Gucci Official Site United States, 2016). The main purpose of this paper is to provide an in depth brand analysis of Gucci. The paper will investigate and evaluate Gucci’s vales and identity, and will discuss how successfully these are reflected by Gucci’s business model, supply chain management, and Corporate Social Responsibility (CSR) activities. In addition to that, the paper will critically evaluate Gucci’s brand identity (identity) in relation to its brand image (external).

LVMH has a diversified source of revenues from all of its different product lines. “Due to its high brand value perception, the company will be able to cross sell its products to increase revenues, primarily because all its products have high end positioning and the customer segment it caters to is uniform across the product

On the other hand, the large market potential has drawn a host of luxury-goods companies to enter the China market, which makes the competition fiercer and fiercer. And it is troublesome for LV that there are plenty of fake goods imitating LV’s style prevailing in China, which are actually not likely to reduce LV’s high-end consumers, but would exert negative influences on consumers’ impression and awareness of LV.