Courtney Baer

Jade Boggs

Narangoo Tsolmonbaatar

Ginger Liu

Agenda

• History - Courtney

• Industry Analysis - Ginger

• Global Analysis - Jade

• SWOT - Courtney

• Competitors - Narangoo

• Recommendations - Jade

• Conclusion - Narangoo

History

• Gucci was established in 1921• 1947 bamboo handle handbag• 1960s Gucci expands to middle east• 1970s family disputes threaten the company• YouTube.com

• 1972 Joined American motors association

• Late 1960s accessory line brought Gucci down.• 1980s Gucci lost its appeal• 1980s Gucci knockoffs entering market• 1980s One of the family members was charged

with tax evasion• 1995 went public• 1997 partnered with Severin-Montres

Industry AnalysisFashion Industry

• What is fashion?

– fashion is the life some people are advocating in a short period

– Fashion has been characterized by change, which decides the vibrancy of fashion industry

• Short History

– In1845, the first fashion designer Charles Frederick Worth, was born in Paris.

– Around 1900, fashion stepped into the all-round development stage.

– After 1900,Fashion had become an industry. – From 1970 to 1980, fashion went into a period

of globalization.– After 1990, fashion industry continuously

rapidly developed.

• Global Issue

– Outsourcing issue

• Producing the products in low-cost countries

VS. locally manufacturing their products

– Intellectual property and piracy issue

• European countries: offer more protection

• America: fashion designs are not protected

• Developing countries: incomplete legal system

• Future Trend

– Fast fashion

– Expand the brand to a higher profit margin

– Combination of fashion and life style

– Develop corporate responsibility

Global Analysis

• Gucci’s Handbag and Leather goods accounted for $1.2 billion in sales in 2005.

Percentage of Sales Growth from 2005-2006

Japan 11%

Europe 14%

North America 24.9%

Asia (excluding Japan) 28.5%

• Dubia, India shopping is main attraction to draw tourists

• Dubia has over 20 million sq. ft. of retail space• August 2008, the Dubai Mall’s grand opening

Trademark Counterfeiting

• 2007- $230 million counterfeit goods seized• Canal Street• Over $176 billion counterfeit goods traded

internationally

SWOT• Strengths

– Strong Brand Name– Strong Presence in International Market– Multiple lines of business

• Weaknesses– Family Feuds– Weak profitability from secondary lines

• Opportunities– International Markets– Consolidation of brands

• Threats– Lower Level Brands– Takeover by PPR

SWOT

Competitors

• Competitors: Chanel, Louis Vuitton, Hermes, Fendi, Christian Dior, Marc Jacobs, Prada, Coach, Celine, Cartier, Bally, Anya Hindmarch, and Versace.

• Stronger competitors: Hermes, Coach Inc, and Louis Vuitton

Hermes

• French high fashion house• Established in 1837• Headquartered in Paris, France• In June 1993, Hermes went public on the Stock

Exchange • In 2006, revenue was $1.96 billion. • By 2006, Hermes operates 240 retail stores in

51 countries• By 2007, Hermes employed over 6,000 people

Hermes’s employees’ percentage in each country in 2007

Coach Inc

• American luxury leather goods company• Established in Manhattan, New York, in 1941• Headquartered in New York City, NY• Coach went public on the NYSE in 2001. • By 2007, revenue was $2,612.5 million• By 2007,Employed 10,100 people, • Coach has 272 retail stores in 24 countries

Coach’s Revenue Breakdown

Coach’s Contribution to Revenue

U.S. handbag Market and Coach’s Share

Louis Vuitton • French leather goods and a luxury fashion

company • Established in France, in 1854• Headquartered in Paris, France• By 1984, LV went public through stock exchanges

in Paris and New York• LV’s revenue was $24,805 million in 2007• By 2007, they employed 33,000 people• Louis Vuitton operates an exclusive retail

network of 388 stores in 56 countries

LV’s Revenue Distribution

LV’s Three Year Financial Performance

LVMH Revenue by Geography

Recommendations

• Short term– Website– Promotion– Purchasing information

• Long term– Expansion in Asian Market– Item Distinction– Designers

ConclusionGucci has made many large steps in the fashion industry over time and will continue to do so as they set higher standards for their employees and others in the industry to meet.

Thank You Any Questions