In an effort to reignite consumer fire, the Italian megabrand has done some restructuring. Bernstein luxury analyst Luca Solca breaks down what it all means.
In the late 2010s, Gucci pulled off a successful turnaround by aligning creative director Alessandro Michele’s unique, baroque aesthetic and Jacopo Venturini’s expert merchandising under the leadership of chief executive Marco Bizzarri, according to Luca Solca, Bernstein luxury analyst and BoF contributor. They injected the brand’s heritage and tradition with streetwear codes and coolness — bringing more casual products like sneakers into the luxury fold, and sparking the era of “new luxury,” said Solca.
Lately, the brand has started to see momentum slow, falling behind rivals on organic growth. In search of a boost, Gucci has reorganised, introducing two newly created roles to support creative director Alessandro Michele.
“The onus is on Gucci to continue to drive newness so that consumers can turn their heads and say, ‘Wow, this is something I don't have. I want to buy it,’” said Solca.
One of creative director Alessandro Michele’s longtime deputies will develop the brand’s commercial collections in the newly created role of design studio director. Maria Cristina Lomanto will oversee merchandising and brand elevation as executive vice president, brand general manager.
The shifts are a signal of Gucci’s intent to appeal to more consumers, while searching for a creative spark. Its biggest challenge right now, according to Solca, is for Gucci to “drive newness” to spur consumer demand.
Gucci is also trying to move even further up-market, a huge challenge because it requires momentum and scale. But, Gucci is relatively well-positioned to do the significant amount of marketing and investment required to elevate a brand, given the now over €10 billion in annual sales it generates.
Michele has been creative director of Gucci for seven years; a long tenure by today’s standards. Relying more on a wider team could help mitigate the risks associated with an eventual creative transition for Gucci as it targets annual sales of €15 billion.