FLORENCE, Italy — Luxury-goods makers are adapting as demand for premium products aligns with the broader economy for the first time in a decade, the chief executive officer of Gucci Group said.
“The luxury industry, for the first time in the past 10 years, had to face challenges that were not there before,” Patrizio di Marco said today in an interview with Bloomberg Television. Amid a tougher economic climate, consumers are looking for greater “insurance” when making purchases, he said.
Gucci’s owner, Paris-based Kering SA, last month reported first-quarter revenue that trailed estimates as the luxury-goods company posted its weakest quarterly growth in more than three years amid a more volatile business climate in Europe. Competitors LVMH Moet Hennessy Louis Vuitton SA and Hermes International SCA have also reported slowing sales growth.
“There was a time when luxury was very much about logo, a label, a name and that was more than enough,” di Marco said. “Now you have to be a company with integrity, values, values and integrity that have to be conveyed to the customer and to be felt so that you can actually engage with them and build a long-lasting relationship. This is basically the today and tomorrow challenge of the industry.”
Kering fell 1 percent to 168.40 euros at 1:53 p.m. in Paris trading today, mirroring the broader market’s decline. Shareholders of the company, previously known as PPR SA, vote to approve the name change June 18.
By: Paul Jarvis, with assistance from Guy Johnson and Francine Lacqua. Editors: Thomas Mulier, Robert Valpuesta