Branding and Gucci Group
1. Vision statement
Become one of the leading luxury groups providing excitement and glamour to a global heterogeneous customer base. Young, creative and hedgy designers allows Gucci to deliver such vision.
2. Situation Analysis
The luxury sector, where the Gucci group is operating, is a market where brand, product and the intangible benefit associated to the brand are key success factors (KSF). The economic slowdown represents a potential threat to the group, which has poorly performed in some of its brands, and has maintained profitability by focusing on emerging markets (BRIC), which are the most likely to be affected by the economic cycle. Given the scenario ahead the management is in the process of deciding its marketing strategy. The options in the table are essentially two. Adopting a more diversified approach (LVMH multi-brand strategy), or continuing developing strong individual brands serving different niche / customer base under the same umbrella company. Vital to the success of the group is the rapid adoption of a clear marketing and investment strategy around its flagship brands. The luxury sector is highly sensitive to the economic cycle and the potential losses in an economic downturn can be considerable given the high level of promotion required to maintain brand equity.
2. Objectives
The Group is facing an uncertain economic scenario which is challenging the profitability of its flag ship brands, in the middle of a restructuring process started in 2004, when the icon designer of Gucci (the brand) and is CEO have both left the company for incompatibility with the new management.
Corporate objectives (5 years)
Reestablish brand equity and image is vital for the group representing top-notch brands with a long life history of success, innovation and creativity within their distinct brand character.
Business / Functional Objectives (Specific, Measurable, Achievable, Relevant, Time bound)
• Reduce business concentration
Become one of the leading luxury groups providing excitement and glamour to a global heterogeneous customer base. Young, creative and hedgy designers allows Gucci to deliver such vision.
2. Situation Analysis
The luxury sector, where the Gucci group is operating, is a market where brand, product and the intangible benefit associated to the brand are key success factors (KSF). The economic slowdown represents a potential threat to the group, which has poorly performed in some of its brands, and has maintained profitability by focusing on emerging markets (BRIC), which are the most likely to be affected by the economic cycle. Given the scenario ahead the management is in the process of deciding its marketing strategy. The options in the table are essentially two. Adopting a more diversified approach (LVMH multi-brand strategy), or continuing developing strong individual brands serving different niche / customer base under the same umbrella company. Vital to the success of the group is the rapid adoption of a clear marketing and investment strategy around its flagship brands. The luxury sector is highly sensitive to the economic cycle and the potential losses in an economic downturn can be considerable given the high level of promotion required to maintain brand equity.
2. Objectives
The Group is facing an uncertain economic scenario which is challenging the profitability of its flag ship brands, in the middle of a restructuring process started in 2004, when the icon designer of Gucci (the brand) and is CEO have both left the company for incompatibility with the new management.
Corporate objectives (5 years)
Reestablish brand equity and image is vital for the group representing top-notch brands with a long life history of success, innovation and creativity within their distinct brand character.
Business / Functional Objectives (Specific, Measurable, Achievable, Relevant, Time bound)
• Reduce business concentration