After reinvention, Gucci CEO plans new path

President and CEO Marco Bizzarri has a new five-year plan for Gucci that focuses on innovation, risk-taking, diversity and circularity. Gucci, riding the success of the partnership between Bizzarri and creative director Alessandro Michele, is one of the fastest growth stories in recent luxury history. The brand has already more than doubled sales between 2015 and 2019 to €9.6 billion driven by the zeitgeist-grabbing Michele’s seasonless collections and Bizzarri’s pivot to digital, a focus on owned retail stores over wholesale and cultural changes that encourage creative freedom. But growth has tempered recently, even as Chinese shoppers still buy into the logo-driven collections. Now, after the reinvention, the pair have a new plan: “What kind of Gucci are we going to imagine in the next 5 to 10 years if we stay together? The idea is to really limit the shows or presentations to give Alessandro the room for creativity and to create a way of injecting the possibility of creativity throughout the year that is not necessarily linked to the show,” Bizzarri said in an interview at the Vogue Business and Google Summit. The Covid-19 pandemic prompted the pivot, already in the planning, he said. “At any moment in an industry, especially fashion, there is a necessity to trade off between legacy and innovation, and today I think the balance is towards innovation.” That will translate into a much tighter two shows per year starting with this week’s GucciFest, a film “festival” including a short series with cult indie film director Gus Van Sant, and follows on from July’s 12-hour-long live stream called, fittingly, “Epilogue”. While Covid-19 prompted an urgent digital pivot for the big four fashion weeks, many brands have since reverted to physical shows and the quick-step pace of resort, Pre-Fall, Spring/Summer, Autumn/Winter and couture seasons. But, while rival conglomerate LVMH boasts a rebound from the pandemic driven by Louis Vuitton and Christian Dior brands who stuck with big-budget fashion shows, Kering-owned Gucci is stepping back and sticking to its outsider position: “There’s no room for creativity,” with a new show every 40 to 50 days, says Bizzarri. Instead, the Florentine brand is leaning into its history of interpreting the global mindset “in an active way”, Bizzarri says. Gucci has always done this, he says, citing the family ownership period, the “splendid era” of Domenico De Sole and Tom Ford, Frida Giannini (where it lost its “fashion edge”) and now Michele, who is “taking risks” that are “very much calculated”, including harnessing the flexibility of digital. Creatively, Gucci’s direction will blend industries like movies and music with fashion, as well as update Alessandro’s aesthetic, which Bizzarri says has become cleaner recently and will be an “evolution, not a revolution” in the next five years. Indeed Michele’s continuous, seasonless narrative and aesthetic has helped the brand hold its power, bolster full-price sales in-store and online and stave off discounting. It’s also been embraced by Gen Z, early adopters who use “I'm Gucci” as slang for “I’m good”, Bizzarri says. But keeping that competitive edge will be crucial to survival. The brand was the worst performer of its major brands in the third quarter, with sales declining 9 per cent as the pandemic tourist slump weighed on sales particularly in Western Europe, and it continued to reduce wholesale accounts in favour of exclusivity, even as sales climbed in Asia-Pacific and North America. To stay ahead, Bizzarri is intent on diversifying the company’s team and culture through measures including tracking the upward mobility of staff, quarterly diversity council meetings and programmes like internal exchange programmes bringing staff from the US and Asia to the headquarters in Milan, and training staff on unconscious cultural biases. Today, 60 per cent of management are women, and in the US, 14 per cent of employees are Black, mirroring broader society. “Mixing culture and understanding is going to be key to create inclusion in the company but also really foster the creativity, which is the single element to protect the most if we want to maintain the competitive edge that we have.” That also means Gucci is expressing their values, including taking a position on gun control to banning fur. “Corporate neutrality is completely finished,” the CEO says, adding brands have a responsibility, which while resonating with consumers is also about retaining employees who share your values. Sustainability is also front of mind with the pivot from the linear fashion model to a circular one. Already Gucci is carbon neutral across its supply chain and has been measuring its greenhouse gas emissions and reduction efforts since 2015: a fall of 37 per cent across the supply chain. The target is 50 per cent by 2025. Bizzarri says the fashion industry needs to be more urgent with its targets, particular on carbon neutrality. “The problem is today everyone is talking about targets (in) 2040, 2050. By 2050 the world is going to be disappearing, it’s too far away from this target. I don't want to pass these kinds of objectives to my successor. I need to try to solve them myself.” With the majority of emissions coming from the supply chain, one step is to incentivise factories and farmers to transition from chemically intensive farming to regenerative farming, which stores more carbon. Other options include investing in and using more low-impact alternative and sustainable materials. Resale is also on the agenda, though few in fashion have embraced it, leaving it to peer-to-peer marketplaces and consignment stores. The recent partnership with The RealReal, where Gucci is selling its older collections itself, was as much to promote circularity as consider the business model, Bizzarri says. So, is Gucci going to sell secondhand Gucci in its own stores? It’s a possibility, but don’t expect just 15 pieces, it will be a more holistic approach if they do it, he said. As ever with Gucci, expect change. “It’s a different way from the past because I think something is changing anyway in terms of approach and behaviours. I do think the industry will remain strong.” Mr Bizzarri called it. To receive the Vogue Business newsletter, sign up here. Comments, questions or feedback? Email us at feedback@voguebusiness.com. More on this topic: Gucci’s new tech bet: Personalised video shopping Gucci plans “new path” with catwalk schedule reduced to twice a year Kering sales beat expectations, adding to luxury buoyancy

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