Following Trends at the Intersection of Fashion and Business
Even if you haven’t checked into the business of fashion lately, this one might get you.
Gucci, one of the world’s leading luxury fashion brands that creates and sells everything from leather handbags to cars, just announced that it is going fur-free. Starting with the brand’s spring/summer 2018 collection, Gucci will no longer use mink, coyote, raccoon dog, fox, rabbit or any other animal bred or caught for its fur. During a London College of Fashion event in October, Gucci CEO Marco Bizzarri said, “Being socially responsible is one of Gucci’s core values, and we will continue to strive to do better for the environment and animals. With the help of HSUS (Humane Society of the United States) and LAV (an Italian animal rights organization), Gucci is excited to take this next step and hopes it will help inspire innovation and raise awareness, changing the luxury fashion industry for the better.”
‘The Business Behind the Beauty’
This was important news for fashion observer Hannah Cronin, who has been watching Gucci closely for the past few years since the emergence of Alessandro Michele, the company’s new creative director. Since he was promoted in 2015, Cronin notes, Michele’s youthful vision has made Gucci particularly trendy. This latest fur announcement is a huge step for one of the most influential brands in the industry.
“When I initially read about Gucci banning fur, I thought that it said a lot about the brand’s desire to keep in touch with the mindset of the more environmentally and ethically concerned younger generation,” says Cronin. “Modern technology allows for the production of faux fur that gives the same effect as real fur that will also be easier to wash and take care of. It will be interesting to see whether this impacts Gucci sales, because while not using fur in its designs is attractive to the younger generation, lots of people buy luxury brands for the authenticity.”
You can be sure that Cronin will be checking in on those Gucci sales figures next spring, as well as the stock price of its parent company Kering, which owns several leading luxury brands, including Gucci, Yves Saint Laurent and Balenciaga. Cronin’s interests lie at the intersection of business and finance, so much so that a few years back she launched Haute Couture Hedge, a website that she considers “the source of all things finance and fashion.” Cronin’s fascination with “the business behind the beauty” is made all the more meaningful by the fact that she is a senior in high school.
“Sophomore year was when I got interested with mixing business and fashion, and that’s when I started looking more into that world and the stocks of fashion companies,” says Cronin, who is a student at York High School outside Chicago. “I’ve always been really into shopping, and I’ve developed this interest in fashion as I’ve gotten older. I started reading magazines and getting into certain brands. From the business side, both of my parents work in finance, so I’ve always been exposed to that. I’m also really strong in math, so I have a natural inclination toward economics and finance.”
For Hannah, family dinner conversations have involved things like options trading for the Japanese Yen, fixed-income derivatives and risk management in the investment banking industry. From there, she built a website that addresses business and fashion news — like how the strong euro poses a threat to European luxury brands – and follows the stock market activity and major events for some of the largest publicly traded fashion companies, such as Ralph Lauren, Burberry Group and Michael Kors.
“There’s a lot more to fashion than people think,” says Cronin. “There’s a lot of analytical thinking. It’s really interesting to think about fashion from a business perspective. I know which brands are trending and which ones are expected to grow.” Haute Couture Hedge also features “Hannah’s Take” on the retail market, a personal style blog, and a look at current fashion trends (tiny purses are really in).
Strategy and Brand Positioning
What are some of the biggest trends defining that intersection between fashion and business right now? Analyst Cronin has some thoughts. “One is the changing retail landscape with the rise of ecommerce,” she notes. “Everyone is turning toward online shopping and there’s a decline in foot traffic in brick-and-mortar stores. With the rise of ecommerce, companies have to change how they market themselves because millennials are really into social media and the digital side of advertising.”
The other business trend can best be described as big fashion, not just high fashion. “We’re seeing a lot of mergers between fashion companies right now,” adds Cronin. “Michael Kors just bought Jimmy Choo, and earlier this year Coach and Kate Spade merged. There’s a competitive market in fashion, and it’s really these big conglomerates that will survive.”
Through her exploration of fashion and finance, Cronin has developed a much deeper appreciation for two solid business concepts: strategy and brand positioning. “Fashion company success is not just about who has the most creative designs,” she explains. “It’s a combo of being creative and unique, but also staying on trend with what your customers want. You have to pay a lot of attention to marketing and branding techniques to make sure that you’re actually selling the product and that people will know about you.”
As with most dynamic industries, Cronin has discovered that the business of fashion is often all about the colorful characters like Alessandro Michele who are constantly finding ways to innovate and stay competitive in a crowded market. If she had a choice, Cronin would most like to meet Bernard Arnault, chairman and CEO of LVMH, the world’s largest luxury goods company that owns such famous brands as Louis Vuitton, Christian Dior and Sephora. “He’s a genius businessman,” she says.
Related Links
- Haute Couture Hedge
- A Humane Nation: Gucci Goes Fur-free
- The Business of Fashion
- NYT: Gucci Picks Alessandro Michele
- NYT: Michael Kors to Buy Jimmy Choo
- Bloomberg BusinessWeek: Paris Is Becoming One Big Monument to Two Rich Men
Conversation Starters
Why is it noteworthy when a brand like Gucci makes an announcement like its recent ban on fur? How does this affect the industry? Can you think of any other similar announcements in fashion or related industries?
Hannah Cronin took her interest as a clothing consumer and decided to explore what makes the fashion industry tick. What do you like to buy? Cars? Horses? Shoes? Pez Dispensers? Whatever it may be, use that interest as a starting point for finding out more about the behind-the-scenes business. Following your research, share what you learned in a group or with your class.
What is brand positioning? Hannah Cronin talks about it in relation to fashion. But how does it also relate to you as a person? What is your brand and how will you get people to notice you?
How does this affect the industry?
Many Brands are making efforts to become more environmentally and ethically friendly, and this announcement affirms this industry trend. It is likely that many high end companies will follow in Gucci’s footsteps in order to attract the millennial market. Overall, fashion and ethical concerns are becoming more and more intertwined.
I think that Gucci going Fur Free is ethically amazing. How ever this could hurt the high end clientele that they make There money off of. People that buy Gucci, Louis, Fendi and Prada are not overly worried about the life of the animal that they are taking. They are worried about how the $20,000 mink coat looks with there Louboutin’s. I do think this could potentially hurt there income.
I think this will be a good thing for Gucci.It will bring in a lot of the younger generation. There’s a lot of movement in protecting animals, and now with Gucci going Fur-Free that might bring some people who are for protecting animals in. No one really wants to side with people who hurt animals. We must do all we can to protect them, not wear them. This is a big step for them, they need to be up the trends and how the public feels. I think this will work in their favor and the favor of others.
Gucci going fur free is showing how much the fashion industry is trying to change. Although it might not help them sell their products. In the end they will only be helping protect animals and will have more supporters. Gucci going fur free is actually huge in the industry and may inspire other companies to do the same.
Gucci going fur free I think is a great idea for many reasons. I believe that they will get more business, because many people don’t like companies that sell off of animals. More and more people are looking more into what they are using to make their clothing’s and if it is safe or what they believe in. So I think this will make more money for them.
I believe that Gucci going fur-free shows a growth in the business and shows development for their brand. They are focusing more on the ethical aspect rather than the economical aspect. Although I do believe this could expand their consumers because it is going to bring in customers who soly purchase products from those who are cruelty free. This will separate them from their competitors and create a moral platform for them to work with.
Gucci going fur free will honestly change the company. How so? This is because some people that purchase Gucci love the certain kind of fur that is made with their clothing brand. However others may like this idea because they are killing less animals in our community/nature. In the end the percentage will probably be 50-50 as 50% will be liking this new idea as the other 50% will be hating this new idea from Gucci.
Gucci going fur-free is a really good step for them in my opinion. Personally, I would never buy something knowing it is animal fur and I know millions of other people around the world wouldn’t either so I think it’s great that they are no longer selling products using animal fur. Gucci, being one of the most popular designer brands, sets an example to other brands to do the same. Although some die hard Gucci fans that like their fur coats and other animal fur products might be disappointed with the new direction Gucci is taking, I think it is a good step towards a better environment and future.
I think that Gucci going fur free is a great step for high fashion brands. Since Gucci has such an influence on other brands I feel that this will create more of a willingness for other companies to go fur free. I think it is amazing that they no longer use real fur and I personally believe that every company should use faux fur. I think this will create a wider span of customers for them because a lot of people are focused on our environment and how animals are being effected by these big name companies.
It shows that the brand is becoming more environmentally friendly and shows the younger generations of people to come now that they are fur free. I think it is amazing that they are now fur free. This affects the industry by maybe losing active customers but also gaining more because it is environmentally friendly, this could go either way. No, I cannot think of any other similar announcements in fashion or related industries. I like to buy cars. As I researched a lot about cars, it is very hard to control a car industry, you must get all the inventory in and make sure the car does not have one mistake on it. Brand positioning is really a place that a brand occupies or controls in the mind of the customer and how it is distinguished from products from competitors. It relates to me as a person by a consumers mind that you want the certain brand to own. My brand is Gucci, and I will get people to notice me by wearing all Gucci clothing, and wear something that sticks out to people including bright colors and different types of leather.
I think that Gucci going Fur Free is ethically amazing. How ever this could hurt the high end clientele that they make There money off of. People that buy Gucci, Louis, Fendi and Prada are not overly worried about the life of the animal that they are taking. They are worried about how the $20,000 mink coat looks with there Louboutin’s. I do think this could potentially hurt there income.
Gucci going fur free is a good move for them in my opinion. I would never buy something knowing it is animal fur and I know millions of other people around the world wouldn’t either so I think it’s great that they are no longer selling products using animal fur. Gucci, being one of the most popular designer brands, sets an example to other brands to do the same. Although some die hard Gucci fans that like their fur coats and other animal fur products might be disappointed with the new direction Gucci is taking, I think it is a good step towards a better environment and future.
Most of the teenagers do not like to buy things which require a lot of care. A Gucci fur coat is definitely the most luxurious and gorgeous coat I ever owned but I have to make sure that I don’t spoil it at any cost and since it’s fur, it is essential to keep it clean and not spill anything on it at all costs.
Gucci’s decision to go fur free and use artificial fur shows how much they care about the environment and that’s remarkable!
I absolutely love Gucci and with this announcement I feel that this brand provides luxury items and at the same time it’s socially responsible. It just makes me love the brand even more! Many fashion brand just want to make profits and they could kill animal for its skin which is apathetic. Gucci’s decision will not only attract environmentalists but also animal lovers. In my opinion, more and more brands should adopt this kind of approach and be socially responsible.
As this Italian fashion-house has been attracting many teenage consumers, it is almost revolutionary in a sense when brands such as Gucci release such announcements. When positive goals are set within a mission of a company such as banning fur, it also really influences the opinions of younger consumers. Other luxury designers including Giorgio Armani, Vivienne Westwood, and Stella McCartney all have announced their mission to be fur free within the past decade. But what really sets Gucci apart to me is their timing in releasing such a statement. After the appointment of Alessandro Michele back in 2015, sales immediately grew over 48% in the first quarter — ever since, Gucci really has outperformed itself compared to its profits over the past two decades. Furthermore, Gucci really has shown its power after being ranked #36 on Forbes most valuable companies. Through such uprising, the timing was perfect in terms of when they announced to become fur free, as their current popularity is a great mechanism to attract more awareness to animal cruelty and abuse. Though banning the use of fur may shun off certain buyers who are in the market for authentic, plush animal fur, I think that there is another sense to luxury to being able to recreate such soft faux furs. Actually, faux fur is more perfect in the context that legitimate fur has many flaws. Different animals, though the same kind, have different densities in their furs and have natural flaws. With faux fur, manufacturers are able to replicate identical fur densities, control volume, and explore with more colors, hence creating a more perfect and creative product.