By now, you must know there’s a lot of competition in the luxury industry despite the price for each of the products available from any of them. However, Gucci has stood firm for over 80 decades, and we believe (and know) it will continue to grow.
Gucci is one of the most successful fashion brands in the world. It’s known for its luxurious leather goods, couture clothes, and diverse portfolio of shoes.
But besides the concept of a luxury brand, what does it have that makes people choose it above others? Or spend their money buying goods? After all, clothes, shoes, and leather goods (among others) can be found in almost every fashion brand.
Well, everything lies in its origins and how it has been able to maintain quality, design, and every single detail so far in order to be a brand that is worth billions today.
The fashion industry is a tricky business to be in, so it’s not simple to understand how things work, but here’s our proposition, what about getting to know it a bit more and make our personal decision of why Gucci is so profitable? Up for the challenge? Let’s get started.
Businessman & Designer: Guccio Gucci
Every business starts with an idea, and for this idea to be possible, a person or several people are needed.
It isn’t any different for this luxury brand, so we need to go over the person behind it before even understanding how it reached the top.
Gucci is a luxury fashion brand founded in 1921 by Guccio Gucci, a businessman but first, a fashion designer with a great vision for the industry.
He was born in Florence, Tuscany, on March 26, 1881.
Before he founded Gucci, there aren’t many records about him working in specific stores or even many of his early years. Therefore, we cannot provide you with relevant information or even irrelevant since we lack it.
However, many assume that Gucci’s love for leather and design started with his father, Gabriello Gucci, a leather craftsman.
From here, we will jump to 1899 when Guccio Gucci worked at the Savoy Hotel in London. There’s no specific date for when he moved to the city, but thankfully, he did.
While working at the hotel, he learned about what the wealthy liked: preferences in clothes, patterns, colors, fabrics, quality, and anything that could build up his idea of fashion.
From there, he got inspired and made sure to keep the idea of fulfilling wealthy people’s needs in terms of clothing, bags, and traveling.
After his years in the hotel, he worked for the Compagnie des Wagons-Lits, a rail company focused on upscale travel leisure.
He worked for four years for the company and learned even more about luxury and traveling lifestyles that were key for his future business. His last job for another company was for Franzi that was a brand specialized in making fine luggage.
Building A Fashion Empire
For every designer and person involved in the luxury industry like Guccio was, you can expect them to desire a store. To be independent.
This wasn’t any different for him, and the story of Gucci (the brand) starts in 1921 when his founder was able to buy his shop in Florence, which he named Azienda Individuale Guccio Gucci.
For starters, he only sold imported leather luggage and moved on to his next step by opening a small workshop to create his own items with the same material but with the help of artisans in the area.
His store didn’t fall short and instead was loved by many in high society, leading to opening a new workshop where 60 artisans worked for the brand.
With over a decade of success, in 1935, a trade embargo was imposed on Italy, which made it difficult for Gucci to maintain the import of his leather goods.
The solution? To offer new fabrics that were of high quality and could satisfy his clients. He came up with alternatives like linen, silk, wool, raffia, and more and had the talent to design and produce them.
After finding this alternative, Gucci developed woven hemp from Naples that had printed the brand’s first signature.
From here, only success is recorded, inviting us to go over a quick timeline:
- In 1938, Gucci opened a new shop in Rome to expand the family business thanks to the profits of the latest sales. More accessories like gloves, belts, and wallets were included in the brand’s catalog by the time.
- In 1951, one of the sons of the fashion designer, Rodolfo, helps his father open the first store in Milan.
- As for 1953, the first store in the USA was established in New York City, while Guccio Gucci dies on January 2 in Milan.
- 1961, more stores are open, but this time, in London and Palm Beach.
- In 1972, the fashion brand reached new regions by opening stores in Tokyo and, in 1974, one in Hong Kong.
- In 1975, Gucci explored a new market by launching its first fragrance.
Here onwards, the brand’s history focused on designers involved and how it continues to grow as a luxury brand.
How Much Is Gucci Worth?
With such success, you would expect the brand to be worth millions, and in fact, you are right but a little off at the same time: it’s worth billions.
Gucci, as you were able to see, has come a long way to this moment, and the brand, despite its difficulties before, during, and after its founder was alive, it’s been able to continue firm.
As for 2020, Forbes placed Gucci as #31 in the World’s Most Valuable Brands list he creates every year.
Its value is at $22.6 billion, being $10.8 billion in sales only. All thanks to how the brand has managed itself plus over 2k employees under its wings.
But after knowing this, there’s a question that comes to mind: why?
Why is it so profitable? How does it make so much money? And, more importantly, why do people buy its products?
People who can afford to pay for one of the products will eventually come for more despite the price because of the quality, design, and style offered.
Every brand has a signature it follows to maintain the image and what makes it unique. In the case of Gucci, leather goods are the most significant segment.
Since its founder came up with the idea and just sold them during the early years, you can feel this is expected, and to this date, 57% of revenue comes from these products alone.
We don’t believe this is the main reason it feels so unique compared to other brands. Instead, we think it is more about quality and how they manufacture their products.
For example, did you know all raw materials are high-quality? Or that they pay a lot of attention to manufacturing and conditions?
All its goods are unique because of the attention they put into it. As people who have looked at many of them, you don’t feel they are the same even when a design or pattern is followed.
If you ever buy something from the brand, expect it to last forever.
Merchandise & Prices – Can You Afford It?
Gucci was created for wealthy people, and it continues to be the same.
Otherwise, could we call it a luxury brand? Not really.
Therefore, you might realize that you cannot afford it, and even if you can, you would think a few times before going for the expense.
That being said, are prices that high? Everything depends, but if you compare them with other brands, you will either have a heart attack or notice it is not that expensive.
Of course, this is as long as you don’t take a brand from your local city and compare it to the worldwide Gucci.
Now, where do we start? With the bags.
A Gucci bag can cost, on average, $1.600 to $2.300. In this case, everything depends on the size of the bag, and when going for mini ones, you can find some options for $650+.
With this standard set, you will find the rest of the items a bit less expensive:
- The cheapest ones include its makeup line. The Mascara L’Obscur is the most affordable item from the brand since it retails at $35.
- Shoes for both women and men range from $670 to $1.5k.
- Scarfs, neck bows, and similar accessories can cost over $200 easily.
- Meanwhile, jewelry and watches tend to exceed the $500 mark.
But this is all you can buy from Gucci?
Fragrances, home accessories, tableware, children’s clothes, and a large variety of clothes for both men and women are available.
Celebrities Who Wear Gucci (& Earn Money by Doing It)
It isn’t a secret that stars play a huge role in making a brand famous, especially in the fashion industry.
This is why you will see dozens of celebrities working with different brands that want to make sure their followers and fans start buying from them.
Although people ignore this, endorsing and sponsoring celebrities brings a significant revenue in sales every year.
In the case of Gucci, figures like Hailey Baldwin Bieber and Blake Lively are included among the celebrities that wear it and openly promote and endorse the brand.
Jennifer Lopez is one of the biggest celebrities sponsored by the brand and openly helps with campaigns for women, children, and accessories. At the same time, we can mention Brad Pitt for the men’s collections, “V” from BTS, and more.
But when it comes to who wears it, we have many names: Beyoncé, Halsey, Harry Styles, Jared Leto, and dozens.
Working with celebrities isn’t new but working with brands from other industries is a big hit today.
For example, Esports is growing in popularity, especially after last year’s lockdown in most countries worldwide.
As a result, partnerships and sponsorships for organizations with players are a big deal.
A great example is Fnatic, a European organization mostly known for its professional team for the online MOBA game, League of Legends, which was recently added as a partner by the brand. Many more are on the way.
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