Over the past few years, Helen Nonini, a 35-year-old executive in Milan, has sold off most of her once-beloved Gucci handbags and accessories. She even got rid of a roomy Gucci travel satchel she received as a gift.
“I just don’t want to be categorized,” says Ms. Nonini. “I don’t want someone in the street to look at me and know right away who designed the bag I’m carrying or how much I paid for it.” Lately she has been favoring other big-ticket, albeit logo-less, labels like Bottega Veneta.
Winning back customers like Ms. Nonini—many of whom are unexcited by the luxury brands that provided a thrill for so long—is an uphill battle for Gucci, whose red-hot growth has sputtered.
On Thursday, Gucci’s parent, Kering SA, said third-quarter sales for the brand declined 1.6% compared with the same period a year ago. Overall sales at the luxury conglomerate rose by 3.3%, to €2.6 billion ($3.29 billion).
Those results are part of a continuing trend. According to Bain, global sales growth of accessories such as handbags and shoes has been decelerating. They grew by 7% last year, compared with 16% in 2012, and are expected to rise 5% this year.
Luxury shoppers are a fickle bunch; and nearly every brand at the high end of the spectrum faces the challenge of keeping its products both exclusive and readily available—concepts that seem to be less and less compatible. Gucci’s efforts to play to both sides of the equation, for example, have resulted in a wide range of prices and assortments that have diluted the brand’s exclusivity, analysts say.
A series of factors, including the end of eye-popping growth in China, Russian sanctions and Europe’s protracted economic malaise, are partly to blame for the problems at some luxury brands. And fresher haute labels, such as Delvaux and LVHM-owned Celine, are attracting sophisticated customers who prefer an alternative to the obvious logo look.
Read more at The Wall Street Journal.