How successful will Gucci be not having sales anymore?

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#16
papertiger said:
Gucci available from third parties have to sign the most stringent contracts and have their a***s off if they err, as many retailers have found to there horror.

I don't think Gucci should wholesale at all.
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I don't think Gucci should wholesale anymore either.

Brands technically can't set prices for other retailers, at least according to Canadian law, but at the same time, they can claim that certain activities can damage a brand and then end an exclusive partnership.

I know Chanel controls its wholesale cosmetics and fragrance prices very well using this method. They withdraw their products if they find out a retailer is marking down its products.
 
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#17
Frida is the one who made me loyal to Gucci so they DEFINITELY need to stop Frida bashing. Gucci is an icon, and will always persevere, HOWEVER, what makes me love Gucci [over lv] is the many DIFFERENT styles they come out with throughout the years, and not the same old same old [literally] like lv. the reason lv can get away with never having sales is because they produce the same bags year after year, so no one can tell if it's AW 2012 vs 2016. However with Gucci just by looking at a bag you know exactly which season it's from [since bags tend to only be produced for one season]. Gucci will only get away with this if they take away their variety and become a drone like lv which would actually make me turn AWAY from Gucci.
 
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#19
Sweet Fire said:
I was chatting with my SA and she told me that for the next 2 years, the Gucci business model is to no longer have sales and see how the profits do. If the profits are steady, Gucci will follow LV and not have sales.

So how do you think this is going to work out for Gucci?
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I've only bought a couple Gucci bags. One I paid full price from Neiman Marcus. The other I bought for discount at the outlet as there is an outlet about 40min away. The outlet is usually very hit and miss with their stock. I wonder if the 'no more sales' going forward will generate more stock for the outlets?

There are seasonal/trendy bags that I would never pay full price for, and I am sure others feel the same. I don't want to pay full price for something that will only be relevant for six months to a year. If there are no sales on these items, then surplus may be likely to end up at outlets? I might be willing to buy a seasonal/trendy bag at the outlet for a discounted price but definitely not full price. Both Gucci bags that I own are more classic styles. The one I got at the outlet was a classic style in a previous season color. I would have been willing to pay full price for it, but I got lucky. I am only willing to pay full pricevon classic non-trendy bags. Perhaps they will just make fewer of the really trendy items?
 
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#22
I am agree with you about Frida bashing. Not a fan of her but she has been the sole creative director of Gucci for close to a decade and did some great work embracing the heritage of the house. But last years of her Gucci's sale fell down. No idea if it is because logo-heavy glamour was outdated or her latest collections were not received well or as some people said wealthy Chinese consumers shifted their allegiance to more upmarket names. Now it looks like Alessandro Micheal has made the brand desirable again and maybe Gucci thought it is the right time to jump to upper market. But the thing I don't understand is "next 2 years, the Gucci business model is to no longer have sales and see how the profits do". Is this a trial? Isn't it weird that such a well-established brand changing and then changing again their business model based on the seasonal success or failure? In my opinion, this is a spoiled attitude.

immigratty said:
Frida is the one who made me loyal to Gucci so they DEFINITELY need to stop Frida bashing. Gucci is an icon, and will always persevere, HOWEVER, what makes me love Gucci [over lv] is the many DIFFERENT styles they come out with throughout the years, and not the same old same old [literally] like lv. the reason lv can get away with never having sales is because they produce the same bags year after year, so no one can tell if it's AW 2012 vs 2016. However with Gucci just by looking at a bag you know exactly which season it's from [since bags tend to only be produced for one season]. Gucci will only get away with this if they take away their variety and become a drone like lv which would actually make me turn AWAY from Gucci.
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Sweet Fire said:
I was chatting with my SA and she told me that for the next 2 years, the Gucci business model is to no longer have sales and see how the profits do. If the profits are steady, Gucci will follow LV and not have sales.

So how do you think this is going to work out for Gucci?
Click to expand...
 
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#24
LaraMarcella said:
I am agree with you about Frida bashing. Not a fan of her but she has been the sole creative director of Gucci for close to a decade and did some great work embracing the heritage of the house. But last years of her Gucci's sale fell down. No idea if it is because logo-heavy glamour was outdated or her latest collections were not received well or as some people said wealthy Chinese consumers shifted their allegiance to more upmarket names. Now it looks like Alessandro Micheal has made the brand desirable again and maybe Gucci thought it is the right time to jump to upper market. But the thing I don't understand is "next 2 years, the Gucci business model is to no longer have sales and see how the profits do". Is this a trial? Isn't it weird that such a well-established brand changing and then changing again their business model based on the seasonal success or failure? In my opinion, this is a spoiled attitude.
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I agree with so much you say. In fact Frida never made a loss. Kering made out that her "sale fell down" by making it sound like Gucci were making a loss through press releases at the time. Actually, there was a very small percentage dent in Gucci's huge profits (net) and not a deficit at all. When you take into account the outgoings and investment that went along with Gucci's consistent global expansion and related operational costs then then it appears as though there was possibly something quite more sinister at play.

Everything is a trail when you have to please short-term shareholders of your company/ies rather than the loyal and new customers that buy the products and services that keep the company going longterm. I'm afraid it's all about annual reports and growth forecasts not about stability of reputation and consistency of quality.
 
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#25
averagejoe said:
Gucci has been scaling back on it's wholesale to retailers, but until wholesale stops completely and all Gucci products are sold exclusively through Gucci boutiques and concessions, it is hard for them to control the pricing and prevent discounts, unlike LV which controls the sale of its products exclusively.
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I believe the prices which secondary retailers may charge are largely dependent on the legal agreements Gucci has in place with secondary retailers. A huge point of contention in forming these Relationship Agreements is whether or not the retailer will be permitted to mark down the items in sales, or offer the goods in special promotions, or whether this is prohibited all together. Of course, these agreements are mostly in place with entities like department stores. I don't know what stores/companies Gucci has been selling directly to, but I assume this is something Gucci's legal counsel advised on if they were asked about it when the business team first floated the idea of instituting greater control over the sales and pricing of products.
 
#26
averagejoe said:
I don't think Gucci should wholesale anymore either.

Brands technically can't set prices for other retailers, at least according to Canadian law, but at the same time, they can claim that certain activities can damage a brand and then end an exclusive partnership.

I know Chanel controls its wholesale cosmetics and fragrance prices very well using this method. They withdraw their products if they find out a retailer is marking down its products.
Click to expand...

The same is true in US law!
 
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#27
paula3boys said:
People will just wait to see older styles at outlet if Gucci truly won't have sales. It won't work till they get rid of outlets
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I don't know about that. Gucci only has a handful of outlets. They aren't like Coach, MK, and Kate Spade where there are outlets all over the place. My guess is that most people don't have easy access to an outlet without some long travel times, and is it worth the travel when there might not be anything at the outlet worth buying? I happen to be lucky and live less than an hour away from an outlet, but I would never travel long distances for the outlet as their stock is VERY hit and miss.
 
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#28
Sweet Fire said:
I was chatting with my SA and she told me that for the next 2 years, the Gucci business model is to no longer have sales and see how the profits do. If the profits are steady, Gucci will follow LV and not have sales.

So how do you think this is going to work out for Gucci?
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oh that stinks! The 2 times a year sales that I know of have great deals.
 
#30
Neetabeeta37 said:
I am just now getting into Gucci and was super excited to learn about them having sales twice a year. I had my list all ready to purchase the Dionysus hobo at the next sale. Very disappointed!
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So pleased you are getting into G. The sales were never quite that simple, Gucci would only put things not selling very well in the sale and so even if there were sales the Dionysus wouldn't be in the sale for quite a few years.

Check out the outlets if you're anywhere near, their stock is often surprising, otherwise be patient desirable bags occasionally end up mint/near mint on the resale market.
 
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