The woman behind fashion megabrand Gucci has paid the price for the luxury label’s declining sales. The creative director, Frida Giannini, is to leave in February after the legendary Italian house’s winter 2015/16 runway shows.
Patrizio di Marco the firm’s chief executive, and Giannini’s partner, will be shown the door before her – he is stepping down next month.
The 93-year-old label, famous for loafers ranging from £400 to £1,390 a pair, has been battered by big changes in the market for luxury goods. There have been signs of “label fatigue”, with shoppers moving away from brash brands towards smaller, less famous names.
While once Gucci’s interlocking Gs logo was regarded as a significant asset, buyers are now less attracted to such obvious bling. Two thirds of Gucci’s sales now come from goods without logos, compared with only 40% a couple of years ago.
The economic problems across Europe have hit sales, as has the slowdown in emerging markets in Asia. There are also signs that wealthy Russian tourists are spending less. At the same time a clampdown on corruption and conspicuous consumption in China – Gucci’s biggest market – has dented sales of expensive gifts, as has recent unrest in Hong Kong. Last year, Gucci reported its slowest sales growth since 2010.
Gucci is part of the Kering group of luxury labels, controlled by the French multibillionaire Pinault family. The group’s other brands include St Laurent Paris, Bottega Veneta, Balenciaga, Stella McCartney, Alexander McQueen and Christopher Kane – but Gucci brings in half the group’s sales.
The problem for Di Marco and Giannini seems to have been that not all labels have been hit as hard by the tougher market conditions. While Gucci announced a near 2% decline in sales over the most recent three months, St Laurent Paris – previously known as Yves St Laurent – saw its sales rise by 28%. Rivals Louis Vuitton and Hermès have also outperformed Gucci.
Giannini’s collections have typically featured glamorous evening wear, luxury materials such as fur and satin, and models with big hair, big shades and big accessories. She joined Gucci in 2002 from rival Fendi to take charge of the handbag business. Two years later she took over the womenswear business when Tom Ford – who had reinvented the Gucci brand in the 1990s – departed. She was promoted to creative director in 2006.
Ford, who took charge in 1994, completely turned around the fortunes of Gucci with his sexy, 1970s-infused look, but Giannini has been unable to do the same over the past decade. Although well regarded, she is a quieter personality and never achieved the superstar status that Ford gave the brand. Gucci’s Milan fashion shows are no longer season-defining events. Fashion watchers say Gucci has floundered because its designs try to please too many consumers at once.
Giannini seemed to acknowledge the brand needed an overhaul when the spring/summer 2015 show, held in September, was styled by Katie Grand, the edgy British fashion editor. Kering is now expected to appoint a designer who will give Gucci a distinct look again.
Analysts and investors have also warned that Gucci raised its prices too far and too fast – a move that has also damaged Britain’s Mulberry.
Charlie Stott, strategist at Wolff Olins, said there was a balance to be struck between attainability and aspiration. The days of conspicuous consumption, he said, were over, meaning luxury labels needed a rethink: “The market has matured in China. It was dead easy in the old days, but now it’s much more about creative craftsmanship.”
Di Marco will be replaced by Marco Bizzarri, currently head of the Kering luxury division and a former boss of Bottega Veneta and Stella McCartney. A replacement for Giannini has yet to be announced.
Finding the right designer to reinvent the Gucci label once again could take some time. It took British handbag maker Mulberry almost 18 months to find a new creative director – Johnny Coca joins from Céline and starts next July – after the departure of Emma Hill. “Getting good creatives is really hard,” said Stott.
The brand dates back to 1921, when Guccio Gucci, a porter at the Savoy hotel in London, took inspiration from the smart luggage he saw there to open his own leather goods store in his native Florence.