Kering CEO details strategy for Gucci's return to growth

Florence, Italy - French luxury group Kering is at a “turning point”, its chief executive officer Luca de Meo said on Thursday. He was presenting the company's new strategic plan in Florence, Italy.

To return to growth, the executive highlighted a series of measures, particularly for its flagship brand Gucci, with a “significant” move “upmarket in quality”.

“Our priority is to make Gucci a must-have again,” said de Meo. The double-G brand has seen poor results for the past three years.

“You have to recognise it's Gucci in a second. That doesn't mean covering the world in GGs (the brand's logo, ed.). It can also be discreet,” said de Meo, who spoke of a “renewed identity”.

Kering (which also owns Yves Saint Laurent, Bottega Veneta, Kering Eyewear, Boucheron, etc.) aims “to generate an additional one billion euros in revenue from leather goods by 2030” for the brand, the executive stated.

“Customers notice quality, they notice consistency and they remember it,” he assured, adding that the house would have 30 percent fewer points-of-sale by 2030.

According to figures published on Tuesday, Gucci's sales continued to decline in the first quarter (down 14 percent over the period) to 1.35 billion euros (1.59 billion dollars), down 8 percent excluding currency effects.

Kering will also implement measures for the Chinese market across all its houses. This is a key region for the luxury sector. The group plans to significantly increase marketing and sales budgets and close points-of-sale there.