New Gucci chief gives star designers a three-year deadline to deliver
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Your support makes all the difference.The new chief executive of Gucci Group yesterday granted its fledgling Stella McCartney, Alexander McQueen and Balenciaga brands a three-year window to hit profitability.
The new chief executive of Gucci Group yesterday granted its fledgling Stella McCartney, Alexander McQueen and Balenciaga brands a three-year window to hit profitability.
Robert Polet, unveiling his strategy for the first time since France's Pinault-Printemps-Redoute swallowed the Italian luxury goods powerhouse, signalled the group would lose patience with the niche brands if they failed to hit a 2007 deadline. But he ruled out selling them before then.
Mr Polet, who was appointed after Gucci's "dream team" of Domenico De Sole and Tom Ford resigned earlier this year, refused to set a similar goal for Yves Saint Laurent. The ex-director of Unilever, who criticised the former management duo's "one size fits all" approach to running the group's 10 separate brands, said he did not want to risk missing a third break-even target for YSL.
Gucci's plans for YSL, which it acquired in 2000, were knocked off course by the economic downturn that followed the terror attacks the following year. Mr Polet said: "We need to hit the sweet spot where it all comes together [for YSL]. When we get close we will alert you to the fact."
He intends to double the size of the Gucci brand, which had sales of €1.5bn last year, over the next seven years. He pledged to maintain the label's exclusivity, which fashion industry insiders had feared was under threat, instead driving growth from high-growth categories such as jewellery, watches and men's ready-to-wear. "It's an old brand, but not an old man; it has been rejuvenated," he said.
The group is aiming for compound annual sales growth of 10 per cent at constant currency, which would outstrip the market. The luxury goods market is projected to grow by 5 per cent.
Mr Polet is still attempting to stamp his authority on Gucci Group, which has been rocked by the departure of more than a dozen senior executives during the past year. In an attempt to calm fears that PPR planned to make the business more commercial - and consequently more mass market - he said: "We will not tinker at all with the current positioning of [Gucci]."
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