GUCCI – How luxury stays ahead in the digital age

Luxury is seeing a huge shake-up at the moment with brands, notoriously tightly closed, having to embrace the age of consumer-driven social media. Those adapting to this new environment are seeing spectacular results and Italian powerhouse Gucci is an example of a reinvention delivering impressive growth.

In February, Gucci’s parent company, Kering, posted market defying full year results for 2016, with its strongest year-on-year revenue increase since 2012. This was driven by the “spectacular growth trajectory” of Gucci, the results highlighted. Like-for-like sales grew 12.7% to €4.4bn (£3.8bn) year-on-year and recurring operating income rose 21.7% to €1.3bn (£1.1bn), with the brand being heralded as one of the sector’s star performers.

Gucci’s main product categories (including handbags, shoes and ready-to-wear clothing) all helped propel the brand to top the €4bn revenue mark for the first time. This increase in demand was credited to the direction of new management duo, Creative Director Alessandro Michele and CEO Marco Bizzarri. Michele’s “highly creative vision” helped boost revenue despite the tougher market conditions in the wider luxury goods sector, Kering reported.

Both men were appointed at the start of 2015 and Gucci subsequently underwent a massive reorganisation, which dampened sales for the period. But with Michele’s influence on collections now trickling through, customers are being enticed back in droves. Gucci has certainly set its mark as a luxury brand back in fashion.

“Michele’s changes were as dramatic as they were rapturously received,” Vogue reported after his debut autumn/winter 2015 show. “Gone was the blood-red-lipped, metallic-sheened night crawler that had previously epitomised the Gucci girl. In its place, a romantic vision of an Italian aristocrat. He brought back the double G logo, put a huge focus back on desirable accessories, and made the brand a season-defining voice in less than one year.” The sexy, Tom Ford girl has definitely hung up her boots. But how has the brand re-engaged with the future Gucci customer base?

Looking outside the fashion world, Michele has worked on innovative digital projects to connect with a new customer base, the most recent being #TFWGUCCI – a collaborative MeMe project based around its latest collection of Gucci watches. Unveiled at international watch and jewellery show Baselworld last week, the #TFWGUCCI was born out of his desire to engage with a wider creative community than just fashion.

Inviting artists from around the world to bring their own personal and idiosyncratic take on the brand’s iconic design motifs, the #TFWGUCCI visuals have striking results (see the full campaign at Gucci.com/tfwgucci.) Asking influencers to re-interpret their design aesthetic is a step forward for Gucci, but this creative freedom is essential if luxury brands are to embrace the social media age and speak to their future customer base.

Will Gucci’s reinvention be a continued success story? You only have to look at Burberry to see the results of a clever re-brand strategy, the right management team and market leading digital innovation that appealed to a younger customer base to see the winning formula. A Phoenix from the ashes, Burberry’s CEO at the time Angela Ahrendts and Creative Director Christopher Bailey spearheaded an immense turnaround at the luxury British brand and turned the failing name into a billion pound powerhouse. Time will tell for Gucci. But with a dream duo, a new creative vision and exciting digital campaigns on the horizon the results speak for themselves.