The digital strategy driving Gucci’s growth
This is a story from Glossy, Digiday Media’s new site covering luxury and fashion and how they intersect with technology.
During a moment of unprecedented change to the luxury industry, Gucci, led by creative director Alessandro Michele, is sitting pretty.
The brand is demonstrating that an unwavering point of view, aesthetic and aspirational story is more critical than ever — especially as other fashion houses appear to stumble, shifting the way collections are shown, ditching creative directors, and streamlining categories to condense. Underlying all those changes, though, is a constant current: The digital challenge facing brands that have long relied on sensory experiences to sell high-end items. It is a challenge Gucci is meeting head on under Michele’s guidance.
“Brands are trying to be everywhere in every capacity,” said Ian Schatzberg, president of Wednesday, a digital creative agency that has advised brands like Mr. Porter and Calvin Klein. “But it’s not enough to be present — it’s about what creates the dream. Ultimately, what Alessandro has done is build an authority that exists in popular culture.”
What he has also done since his appointment as creative director in January 2015, is create high-fashion clothes that actually sell. Kering Group, Gucci’s parent company, reported a 4 percent bump in revenue, to $3 billion, in its first quarter report in 2016, released on April 21. Gucci sales in that period climbed 3.1 percent, to $1 billion. Last year, the brand brought in $4.4 billion.
The brand’s success is in its creation of a lifestyle that people want to emulate, and therefore buy into. Gucci’s story is well told, and sold, online. Its e-commerce site, launched in 2002 and revamped in October, was considered an industry trailblazer. In 2015 received 100 million visitors, per Kering. While online revenue accounted for just 7 percent of Kering’s overall revenue in 2015, it increased by 22 percent, to $19.3 billion. The Group is making investments into rolling out key digital functionalities (such as a single cross-channel customer database and reserve online, pickup in store) as it looks down the line. According to Bain Capital predictions, e-commerce sales for the luxury sector are expected to grow 24 percent annually through 2020.
Kering representative Eloi Perrin said that “e-commerce is a strategic priority for Kering, not only for the business the Group’s brands conduct online but also because it influences demand across all sales channels.”
For Gucci, its digital strategy reflects a brand first, channel second mentality that results in a visually engaging, fully functioning e-commerce store with full product offerings on sale, and a social media strategy that does what it needs to do without overreaching.
Building digital inspiration
Gucci’s e-commerce store puts its most recent ready-to-wear collections on sale alongside its lower-priced items like handbags, shoes and accessories. (While Gucci announced in April that it would be combining its men’s wear collections with its women’s, it will still put items on sale six months following the runway show.) Shopping Gucci online is an experience that mirrors its runways: each ready-to-wear look is sold as pieces of the outfit that appeared …read more