Fashion Market Watch: Gucci To Outlast Recession

The French luxury and retail group PPR that owns Gucci Group, which includes the brands Gucci, Yves Saint Laurent, Balenciaga, Stella McCartney, Bottega Venata, Alexander McQueen, and Serigio Rossi, reported a 5.8% increase in sales for 2008 and 4.4% increase for the fourth quarter alone, mainly contributed by....you guessed it international activity. International sales made up 61% of PPR's activity for 2008, 21% from North America, and the star luxury brand that just about contributed to all of the companies success and staying power was Gucci . The Gucci brand is the largest of PPR's portfolio and continues to rank in the most revenue over the rest of the Gucci Group brands. PPR's revenue between October and December alone rose to $6.71 billion from a year ago, if that's not outlasting an economic crisis I don't know what is.

Gucci, founded in Florence in 1921, has obviously made it's mark in the fashion world, but there will always be critics. Fashion elitist are saying Gucci is only selling because of it's lower prices and it's availability to the masses. Once deemed a luxury power house, after saturating the market Gucci has struggled to reposition itself with the most luxurious high fashion brands. Gucci has changed it's target market and the old target isn't happy at all. It's a catch 22 though, do they keep their brand affordable to continue to have profitability; or do they reinvent themselves by increasing prices and product quality to re-establish their original namesake. It seems like PPR likes revenue in these struggling times, as they plan to open more Gucci stores this year and increase advertisement...Good idea right? Business wise yes!! Brand wise, maybe not.

The only people that are upset about Gucci's low prices and availability to the masses are those who can afford to pay $5,000 for a bag. I'm not complaining at all, but I do agree that the image of the brand continues to decline. In fashion we want to feel like what we have is exclusive and it's almost a sense of disappointment when you see everyone walking down 5Th ave. with the same bag or shoes. It definitely cheapens the image of the brand in my eyes. None the less PPR is enjoying making a profit is this horrible economy. I guess we will just have to wait and see if Gucci will ever re-establish itself among the high fashion houses in the future; but in the mean time they definitely are outlasting the recession and that's what matter most.

Look Below For Gucci Goodies......

New Jackie Shoulder Bag

$2995

Rampling Ankle Strap

$1475

Ladies Web Large Hobo
$795

Joy Medium Boston Bag

$730

Iman Ankle Strap

$1295

*Click here to find info on these products : Gucci

Smooches,
Chloe Elle


Sources: WSJ.com, bussinessweek.com, PPR.com