Gucci, the renowned luxury fashion brand owned by the Kering group, has once again solidified its position as the top revenue generator for the company in 2018. The CEO of Kering, François-Henri Pinault, lauded Gucci’s phenomenal performance, highlighting its impressive €8.28 billion in sales for the year. This marked a significant leap with a remarkable 33.4% increase in published figures and a striking 37% growth in like-for-like terms.
Pinault commended Gucci for its exceptional growth trajectory, attributing its success to a well-rounded and robust performance throughout the year. Under the leadership of CEO Marco Bizzarri and Creative Director Alessandro Michele, Gucci achieved a remarkable 28% surge in comparable sales in the fourth quarter, setting a positive tone for the upcoming year. The brand witnessed a commendable 38% increase in full-price sales in its stores, reflecting a strong demand across various regions and customer segments.
The strategic investments made by Gucci in 2018 significantly boosted its operating income, surging by 54.2% compared to the previous year to reach €3.275 billion. Gucci’s contribution to Kering’s total operating profit exceeded 80%, amounting to €3.944 billion.
Looking towards the future, Gucci has set ambitious targets for its growth trajectory, aiming to achieve a revenue milestone of €10 billion. The brand is poised to surpass the market growth rate, with plans to double the anticipated growth range of 5-6%. Furthermore, Gucci aspires to achieve an operating margin of 40% in the near future and exceed €1 billion in online revenue. The brand is eyeing expansion opportunities in China as part of its strategic growth plan.
One key focus area for Gucci is its fragrance and beauty segment, currently under the licensing agreement with Coty. The brand aims to enhance the performance of these product lines, recognizing their significance as an entry point to luxury for many consumers. Gucci is gearing up to launch a high-end jewelry line and bolster its presence in the travel retail segment.
Gucci’s retail strategy has been pivotal to its success, with stores fetching a commendable profitability of €40,000 per square meter in 2018. The brand is in the process of revamping its store network to align with the new interior concept by Alessandro Michele, showcasing an expanded product range to cater to diverse consumer preferences.
Overall, Gucci’s stellar performance in 2018 underscores its resilience and unwavering growth trajectory within the Kering umbrella. With a strong leadership team and a clear strategic roadmap, Gucci is positioned for continued success and poised to retain its status as a global luxury powerhouse.
For more insights into Gucci’s latest collection and updates, visit their official website here. To delve deeper into Kering’s annual financial results and strategic outlook, check out the official Kering group website here.
