Gucci Case

In: Business and Management

Submitted By shell2003
Words 918
Pages 4
Gucci Business-Level and Corporate Strategy During the late 1990’s, Gucci portrayed the characteristics of a firm with a differentiated business-level strategy. Gucci provides value to their customers with high quality luxury goods which consist of unique product features in relation to their rival competitors. One example of Gucci’s distinct quality is the prestigious image of their brand name using the famous “GG” logo on their items. Gucci is a successful firm in the luxury goods industry with many resources and capabilities that differentiate them from other companies within the industry. The first resource is the management team of Gucci following the millions in losses during the early 1990’s. Two managers in particular are Dominco De Sole, head of Milan office, and Tom Ford who replaced Dawn Mello as creative director in 1994. The duo of Ford and Sole turned the company around from near-bankruptcy to a close rival with LVMH, the luxury goods powerhouse. The two of them possess an intangible resource to Gucci that is valuable, rare, inimitable, and non-substitutable. Ford and Sole are considered to be valuable to the firm because of their leadership and vision to make Gucci a global presence and rare because their management skills are unlike any other firm in the luxury goods industry. What makes the management team a sustainable capability is the difficulty for other firms to match their business strategy from financial decisions to marketing abilities. Another resource that Gucci has used to gain a competitive advantage is its glamorous fashion sense that captures consumers all over the world. This resource only has the valuable characteristic however its quality is very significant to the Gucci brand. It is not a sustainable advantage because competitors also use a…...

Similar Documents

Gucci

... FASHION FAUX PAS: GUCCI & LVMH “The brewing battle for Gucci is emblematic of the New Europe that is taking shape with the launch of the common currency and the globalization of industry: two Frenchmen squaring off for control of a Dutch-based Italian company run by a U.S.-educated lawyer and an American designer, and advised by London-based American investment bankers. “Gucci Watch,” Wall Street Journal, March 22, 1999. The Gucci Group N.V. 2000 Annual Report really said it all. Tom Ford, Creative Director, and Domenico De Sole, President and CEO, stood side-by-side facing the camera with eyes of steel. Ford, unshaven and shirt provocatively opened, was the American designer who had single-handedly revitalized the Gucci name. Domenico De Sole, dressed in a dark suit, white shirt, with finely trimmed beard, was the Italian lawyer -turned-businessman who had returned Gucci to profitability and promise. The photograph, of course, by the famous fashion photographer, Annie Leibovitz. These two men represented the defiant spirit of Gucci, a molten mix of high-powered fashion and high-powered finance. These two men had, in the first six months of 1999, been the centerpiece of one of the most highly contested hostile takeover battles ever seen on the European continent. Under attack by LVMH Möet Hennessey Louis Vuitton, the French luxury goods conglomerate, Gucci had implemented the age-old strategy of “the enemy of an enemy is a friend.” Gucci successfully......

Words: 5995 - Pages: 24

Case Study - Vertu, Gucci, Lv

...Executive summary Prestigious and Luxury brands such as Gucci, Louis Vuitton and Vertu represent the uppermost level and form of craftsmanship. They demand and hindercustomer loyalty that is not affected by trends. These brands set seasonal trends and are capable of generating consumers, wherever they are established. In luxury marketing, there is a delicate relationship between 4 factors that most strongly influence the purchase of the luxury consumer. They are the exclusiveness of the brand, the reputation of the brand, forms of distribution and price/value affiliation. Exclusivity cannot always be ensured due to immense competition. But by consequence, it is not the key requirement of a luxury consumer. The consumer bases their purchasing decisions mainly on the aura of the brand and completion of their ‘actualization needs’. Therefore, aura of the brand is more important than exclusivity. A luxury consumer is always looking for newer ways to satisfy their inconsistent wants and needs. Therefore, it is important for Gucci, LV and Vertu irrespective of their exclusivity and geographical presence to research and give their consumers major importance, to be successful in the fashion or high-end market. This report will aim to discuss the key success factors of Gucci, LV and Vertu that have impacted on their brand image and exclusivity. Furthermore, it gives a detailed explanation supported with examples on how they achieve their elitism. It then discusses the......

Words: 1846 - Pages: 8

How Culture Afftects Advertising: the Case of Gucci

...The House of Gucci or simply known as Gucci is the biggest selling Italian fashion leather and luxury brand, it has been in existence since 1921, and regularly charts on Interbrand “Top Global 100 brands”. The Gucci Brand operates in the following areas – Africa and the Middle East (11 countries), Asia (14 countries), Australia (2 countries), Central America and the Caribbean (3 countries), Europe (22 countries), North America (3 countries) and South America (1 country). This represents a total of 56 countries in which the Gucci Brand operates. The marketing/PR campaign that I am about to critically analyse is called the Gucci Cruise campaign (for their handbag range), it was launched in 2011 via several media forms: TV, internet and print, the focus of my analysis would be on the print campaign. Gucci products are held in high esteem by its target audience and caters to a particular high end segment in most countries. It is not what you would consider to be a mass retail brand, very little adaptation is done, if any, across different markets. Gucci is associated with success, class, sophistication and exclusivity worldwide, its brand strength is quite appealing and people are willing to pay a premium price for a perceived premium product. Gucci products are standardised across the globe. I am going examine the intercultural issues of this campaign such as, tastes, customs and norms of Italy the home country and China their largest market in Asia and the strategies......

Words: 1865 - Pages: 8

Gucci

...History of the Gucci Gucci remained one of the premier luxury goods establishments in the world until the late 1970s, when a series of disastrous business decisions and family quarrels brought the company to the verge of bankruptcy. At the time, brothers Aldo and Rodolfo controlled equal 50% shares of the company, though contributed less to the company than he and his sons did. In 1979, Aldo developed the Gucci Accessories Collection, or GAC, intended to bolster the sales for the Gucci Parfumes sector, which his sons controlled. GAC consisted of small accessories, such as cosmetic bags, lighters, and pens, which were priced at considerably lower points than the other items in the company’s accessories catalogue. Aldo relegated control of Parfums to his son Roberto in an effort to weaken Rodolfo’s control of the overall operations of the company. Aldo Gucci expanded into new markets including an agreement with American Motors Corporation (AMC). The 1972 AMC Hornet compact "Sportabout" station wagon became one of the first American cars to offer a special luxury trim package created by a famous fashion designer. The Gucci cars sported boldly striped green, red, and buff upholstery and on the door panels, as well as the designer's emblems and exterior color selections. Though the Gucci Accessories Collection was well received, it proved to be the force that brought the Gucci dynasty crashing down. Within a few years, the Perfumes division began outselling the Accessories......

Words: 319 - Pages: 2

Gucci Group, N.V. Case

...Case, Gucci Group N.V. (A) 1. Map competitive positioning of different players in the luxury goods arena and state who is best positioned and why? The luxury goods arena is a highly competitive industry in which companies must position themselves with both objective and subjective differentiating factors. Although humans are usually rational buyers when it comes to commodities and the necessities of life, much of this logic is thrown out when purchasing high-end luxury goods. While high quality is a necessary component of luxury goods, it is the brand’s image that a customer is really purchasing. Taking this into consideration, the true competition in this industry lies not in the technical differences in products offered, but in the perceived extent of luxury status the purchaser will receive upon buying said luxury item. There are several players in the luxury goods arena that have all become household names across the world through their strategic positioning. Currently, Hermes is considered as the “top of the line” luxury goods brand, with Chanel in a close second. Ferragamo is considered to be at the lower-end. For the sake of this case, we will focus on the middle tier, which consists of Prada, Louis Vuitton (LVMH), and Gucci. Firstly, Prada is much smaller relative to many of the big players in this industry, but it has been actively acquiring and growing throughout the last two decades. What started as a high-end luggage company has expanded to a producer of all......

Words: 1716 - Pages: 7

Gucci

...Introduction Gucci India Story………………… Indian Fashion Retail Landscape FDI Scenario………………… Modes of Entry of Foreign Retailer………………… India as a Manufacturing Hub for Global Luxury Brands Indian Luxury Market Indian Luxury Product Market- A Snap Shot………………… The Luxury Consumer Profile Target Groups for Luxury Brands………………… The Competitive Trend Creating an International Luxury Fashion Brand……… Key issues facing the industry Major Cost Component………………… Gucci as a Company Gucci’s goals and values………………… Philosophy………………… Gucci as a Brand………………… Marketing Distribution Channel………………… Revenue Breakdown Prices in Indian Market The Bumpy Road? . . 2010 ANNEXURES I II III IV V VI VII VIII IX X XI XII XIII KEY DATES………………… INDIA VS CHINA AS A MANUFACTURING HUB……………… THE INDIAN WEALTH LEAGUE………………… SHOW ME THE MONEY- WELATH DEFINITIONS…………… HNWI POPULATION GROWTH RATE 2007 (%)…………… INDIA’S ‘BRAND FREAKS’………………… 28 29 30 30 31 32 33 34 35 36 36 37 NO. OF CATEGORIES VS MARKET IMAGE………………… GUCCI GROUP DIVISIONS………………… DISTRIBUTION CHANNELS………………… REVENUES BY CHANNEL………………… GROUP REVENUES BY REGION………………… CAGR 1994- 2001………………… PPR CONSOLIDATED 2004…… FIGURES AT YEAR END 37 . . 2010 GUCCI Fashioning India 1. Introduction The House of Gucci, or simply Gucci is one of the more established premium fashion brands in the world. Its success worldwide has depended largely on its effective marketing strategies and a wide product range. Founded in Florence in 1921,......

Words: 7640 - Pages: 31

Gucci

...Gucci Designs Success with Aldon CASE STUDY “We found Aldon Lifecycle Manager for iSeries to be an extremely vital piece of the development process to keep the structure under control. We couldn’t function without it.” – Francesco Morabito, Senior Manager, Gucci Gucci has helped to create and define concepts of fashion around the world for the past 50 years. Gucci's retail arm has relied heavily on the AS/400 to help run its business operations out of their headquarters in Florence, Italy. According to Francesco Morabito, a Development Manager given the mandate of reorganizing the programming environment, they were starting to encounter problems because several different programming teams were operating independently of each other and developing their own customized versions of their retail software package. The solution was to centralize development and bring some structure to the development process by instituting a change management system: Aldon Lifecycle Manager for iSeries. Background Gucci had been a long-time user of a retail software package from an outside vendor. Over time, a multi-layered structure of different versions developed. The problem was a lack of commonality between the versions. Morabito explained, “Developers from all over the world were modifying and ‘fixing’ the package. In the end, we had a package that appeared to work. But we had no idea what the software makeup below that was like.“ It was decided to incorporate elements of the three......

Words: 1019 - Pages: 5

Dior/ Gucci

...massively in the worldwide network. The creation of an online presence through their website allows them to complement their media channel and to reach more and more potential customers. However, Internet hasn’t been received in the same way by all industries. For example, the luxury industry was afraid to use this new media for many years. Indeed, the luxury world is characterised by idea of high-price products and exclusivity whereas Internet is associated with discount prices and mass communication. Nowanays, luxury brands have understood that Internet must be part of their marketing strategy. In this paper, I’m going to analyze the official websites and the online presence of two well-known luxury brands: Dior (www.dior.com) and Gucci (www.gucci.com) II/ Company profile 2.1 Dior: Spirit and history of the brand Dior is currently one of the biggest brands in the luxury world. The French company is named after its designer Christian Dior who established the company in 1947. After years of privation during the Second World War, the goal of Christian Dior was clear: he wanted to go back to luxury, feminity, grace and lightness. With his first collection  « New look », the designer offered an avant-gardist shape characterised by full-skirt, large bust and smaill waist. This collection was the symbol of a real revolution in the fashion world industry and had a huge influence on other......

Words: 5666 - Pages: 23

Gucci Case Study

...fashion, luggage, jewelry, cosmetics, fragrances, watches, and drinks. In the luxury goods business there are 35 companies that share 60% of the market, but only 6 of them have revenues in excess of $1 billion. Considering the definition explained before, the most important companies which belong to the market are: Louis Vuitton, Cartier, Gucci, Prada, Hermes, Bulgari, Tod’s, Celine, Jil Sander, Kenzo, Valentino, Lacroix, Donna Karan, TAG Heuer, Armani, Tiffany, Chanel, Ralph Lauren and Tommy Hilfiger. It is an interesting market because it is completely focused on the quality of the product from every point of view: the beauty and the design of the product, the refinement and affectation of raw materials, the meaning of the product (the style and the social status of the person to whom it belongs) and the values and emotions that it transfers. As a result, the company focus is mainly on differentiation rather than on cost, therefore these companies follow a differentiation strategy in order to obtain a differentiation advantage. This feature of the market is reflected on the companies’ results, for example looking at the return on sales ratios of Gucci (27% in 1999) in relation to ther company markets like Coca-Cola Company (10,6% in 2000), Amazon (6,8% in 2000) and Dell (8% in 1998). Considering the market in general, LVMH holds the first position followed by Vendôme that represents the leaders of the market. While Vendôme’s products portfolio regards watches, jewelry and......

Words: 292 - Pages: 2

Gucci

...This state of innocence persisted through my early teens, but changed dramatically in the spring of my sophomore year of high school. My beloved father was dying of AIDS. First Body Paragraph Topic/Transition Sentence: From the moment my parents told me, I confronted emotions and issues that many adults have never faced. Development of ideas related to the topic sentence (Signpost question addressed: values and philosophies) Death of a parent, and AIDS specifically, forced my view of the world and my sense of responsibility to take a dramatic turn. I had already accepted my father's homosexuality and had watched through the years as he experienced both prejudice and acceptance related to his sexual preference. However, in this case I did not have the benefit of time to understand my father's illness since he decided not to tell me until he had developed full-blown AIDS. My role in the relationship was suddenly reversed. End Sentence Where I had once been the only child of my single father, I was now the parent to the debilitated child. Second Body Paragraph Topic/Transition Sentence By the summer of my junior year, I had rearranged the structure of my life; as my father's illness progressed and he became increasingly incapacitated, he depended on me a great deal. Development of ideas related to the topic sentence (Signpost question addressed: evidence of responsibility) Each morning before school I took him to the hos...

Words: 365 - Pages: 2

Louis Vuitton and Gucci Case Study

...Case Study Competitive advantage at Louis Vuitton and Gucci MEMO The market of high fashion luxury goods presents US$165 billion of annual sales and gross profit margins of over 50 per cent. The leader company seems to be LVMH fashion house, with US$12billion of sales, followed by Richemont with US$3.6 billion and Gucci Group with US$2.4 billion. According to the text, the key activity of those companies is the preparation and display of new collection for their bi-annual fashion show. Analysing each activity which constitutes the value chain, I can say that: * Suppliers – the co-ordinating company has a relatively important function, since it works closely with the designer in determinant aspects (such as colours, patterns among others) of the collection’s design. The Chinese and Italy co-ordinating associated company’s which supplies and dye, spin and weave the silk, respectively,are not so important, because is the designer’s work at fashion house that creates the main value – final collection design instead of components supplied. BALANCE=LOW/MEDIUM VALUE ADDED * Inbound Logistics – there are many imports and the goods arrive at the fashion house not using an exclusive method. BALANCE=LOW VALUE ADDED * Operations – is about working on final product, which is design and manufacture of each haute couture dress. Here, the name of the designer is a crucial element, since the fact she or he is famous add a large value, but specialized seamstresses who cuts and......

Words: 892 - Pages: 4

Case Study - Vertu, Gucci, Lv

...Prestigious and Luxury brands such as Gucci, Louis Vuitton and Vertu represent the uppermost level and form of craftsmanship. They demand and hindercustomer loyalty that is not affected by trends. These brands set seasonal trends and are capable of generating consumers, wherever they are established.In luxury marketing, there is a delicate relationship between 4 factors that most strongly influence the purchase of the luxury consumer. They are the exclusiveness of the brand, the reputation of the brand, forms of distribution and price/value affiliation. Exclusivity cannot always be ensured due to immense competition. But by consequence, it is not the key requirement of a luxury consumer. The consumer bases their purchasing decisions mainly on the aura of the brand and completion of their ‘actualization needs’. Therefore, aura of the brand is more important than exclusivity. A luxury consumer is always looking for newer ways to satisfy their inconsistent wants and needs. Therefore, it is important for Gucci, LV and Vertu irrespective of their exclusivity and geographical presence to research and give their consumers major importance, to be successful in the fashion or high-end market. This report will aim to discuss the key success factors of Gucci, LV and Vertu that have impacted on their brand image and exclusivity. Furthermore, it gives a detailed explanation supported with examples on how they achieve their elitism. It then discusses the problems and obstacles......

Words: 262 - Pages: 2

Gucci History

...If you saw it written in a novel or watched it as a movie, you simply would not believe the goings-on in the Gucci family. The firm was founded by one Guccio Gucci, in Florence, in 1923, as a manufacturer and retailer of travel luggage, in high quality leather. Guccio had been a humble dish washer by trade, but he had worked in some of the best hotels in London and Paris, and was inspired to return to Florence, a city renowned for the quality of its artisans and its fine quality of work, to begin the manufacture of high quality luggage. Guccio Gucci - library photo, PPR website Gucci expanded into the large towns and cities of first Italy, then Europe and later the rest of the world, and along the way it also expanded its range of goods. Still using mostly leather, but with some other materials and fabrics, such as bamboo and silk, Gucci branched out into belts, wallets, shoes, handbags – and latterly, cases for mobile phones, i-Pads, and so on. The family controlled the business until comparatively recently, but it was a history of family intrigues and boardroom tussles dating back over many decades, before it became part of the luxury goods conglomerate, Pinault/ Printemps/ Redoute (PPR), where the scandal comes in. Guccio had six children, but only sons Vasco, Aldo, Ugo, and Rodolfo were directly involved in the business. After Guccio's death in 1953, Aldo led the company to a position of international prominence, opening the company’s first shops in London,......

Words: 840 - Pages: 4

Gucci Analysis

...Brief History          Guccio Gucci opened a small shop selling leather goods on the via del Parione in Florence in 1923. He sold luggage imported from Germany and offered customers with repair services. As the luggage business prospered, he opened his own workshop to produce his own design. The business in the 1920’s created huge profit and success however in the 1930’s Gucci began to face some challenges when the sanctions imposed on Mussolini. He faced shortage of imported leather yet this challenge gave him innovated idea of using new materials such as canvas and produced small leather goods, wallets and belts that are still big part of the Gucci company. Gucci became an internationally known luxury brand after World War II and over the next two decades the company flourished. In the1970s Gucci began to fall down due to internal conflict. Most of the conflict was between Aldo and Rodolfo Gucci, the founder’s surviving sons over strategy and control of the company. Rodolfo Gucci died in 1983 and left his 50% stake in the company to his son Maurizio. One year later, Maurizio seized control over Gucci and determined to transform Gucci into a modern retail organization. Maurizio failed. Years later, Tom Ford and Domenico De Sole are given the credit for turning Gucci around in 1994 and turned the company into a powerhouse luxury brand. This case study will discuss why Maurizio failed to transform Gucci and how Tom Ford and Domenico De Sole rebuilt Gucci again. Luxury......

Words: 2903 - Pages: 12

Overview of the Gucci Group Case

...Gucci’s origins date back to 1921 in Florence Italy. It was started as a leather goods store by a man named Guccio Gucci. For the next fifty years after its creation, the Gucci logo had become a well-known fashion image. It wasn’t until the 1980’s when the company began to struggle due to aggressive branding, a poor licensing strategy, and an array of family altercations about who will be the progeny of Guccio Gucci. Finally, Maurizio Gucci, Guccio’s grandson, took control of the company in 1984 and restored it as a luxury brand. Within the next ten years, business began to plummet once again and Maurizio was compelled to sell his shares to Gucci’s second-largest shareholder, Investcorp. Investcorp’s two newly appointed executives, Tom Ford and Domenico De Sole, transformed Gucci back into a superior fashion brand within five years. The sales raised from $200 million in 1994 to $1 billion in 1999. This success caught the eye of many investors, such as French luxury group LVMH, which acquired 34% of Gucci’s shares by 1999. To protect their company from a takeover, Gucci established a new equity by offering 40% of its shares to PPR, a French global retail and luxury group. The new shareholder helped Gucci create a corporate of multiple luxury brands. There was a total of eight Gucci different brands each with their own management system and designer. Once Gucci became a multi-brand company, its family oriented and centralized business approach began to collide with PPR’s more......

Words: 2025 - Pages: 9

Hetalia: The World Twinkle OVA Episode 4 English Dubbed | Education and its value - 592 Words | Tamago APK