The 30 Second Briefing: Have we experienced the end of bling?
Friday 25 April 2014
According to the owner of Gucci, brash logos are not in vogue any more, and it plans to sell more subtle styles in future.
Has this trend hit sales? Yes. Gucci's sales were below analyst expectations for the first quarter - up just 0.3 per cent. It is restructuring the brand and cutting back on many of its cheaper stockists to make the brand even more exclusive.
Is this just a problem for Gucci? No, rival Louis Vuitton has had a similar problem. But the owner of Gucci has many other brands that are off-setting Gucci's issues.
Like who? Do they own Puma? Yes. Kering owns Puma but its luxury stable also includes Alexander McQueen, Balenciaga, Saint Laurent, Bottega Veneta and Stella McCartney - and some of these brands are booming. Sales across the group were up 6 per cent on a comparable basis. Overall sales reached €2.4bn, up 4.1 per cent.
So how is Kering managing all these different brands? It is selling off its La Redoute catalogue business, Puma is already part of a separate group and it has just split its luxury division.
Its luxury managing director Alexis Babeau is leaving and it has promoted Marco Bizzarri to run its couture and leather goods' division, while Albert Bensoussan will run watches and jewellery. Both men, as well as Gucci's chief executive Patrizio di Marco, will report into chief executive François-Henri Pinault.
What does Mr Pinault hope to achieve with this shake up?
Mr Pinault said the restructure will help “further accelerate the development” of its brands while “respecting the autonomy and individual identity of each of them.”
So what did these chaps do before?
Italian Mr Bizzarri has been running Bottega Veneta since 2009 and he is in the process of finding a replacement for this job so he can take on his big new role while Mr Bensoussan has worked at rival LVMH in its watches and jewellery business and has been a luxury consultant for the past four years.
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