As an evergreen brand in the luxury goods industry, Gucci has been warmly sought after by young people in recent years. However, the current situation makes people wonder: why did Gucci suddenly lose its previous sales charm?
“The poor performance in reality and uncertainty in the future are the main reasons for the decline in stock prices.” Luxury expert Zhou Ting pointed out the reason for the “flash crash” of Kaiyun Group’s stock price in an interview with reporters.
On March 20th, Kaiyun Group issued a new warning on its performance for the first quarter of 2024. Kaiyun Group stated that based on current trends, it is estimated that the group’s revenue for the first quarter of 2024 will decrease by about 10% year-on-year. This performance mainly reflects the sharp decline in Gucci’s sales, especially in the Asia Pacific region. Kaiyun Group stated that Gucci’s sales in the first quarter of this year are expected to decrease by nearly 20% year-on-year.
Regarding this, Zhou Ting pointed out that the collapse of brand image is the main reason. “Luxury brands are also further stratified, LV and Chanel are actively competing for Herm è s’ first luxury brand position, while Gucci is gradually withdrawing from the top tier luxury brand camp. The unsustainable product innovation is the second reason for Gucci’s sales decline. Diversified and personalized consumption, product innovation has become the core competitiveness of luxury brands, but it is obvious that Gucci has not made any achievements in product innovation in recent years.”.
At the same time, Zhou Ting believes that Gucci still has “a series of failed market strategies”. “In order to promote sales, Gucci lacks selectivity in customer base and sales channel selection, and its brand positioning is unclear, leading to a large number of customers fleeing and new customers unwilling to choose.”.
