Specialist
Senior executive at LVMH Fashion (Shanghai) Trading Co Ltd
Agenda
- Gucci’s LFL trading outlook in Greater China, including drivers by category and channel
- Competitiveness of product offer and customer experience vs Dior and Hermes
- Distribution shifts in 2021, including online growth outlook
- Gucci’s EBIT margin outlook in China
- Kering M&A opportunities
Questions
1.
How strong was trading on a like-for-like basis for personal luxury goods in Q1 2021, perhaps compared to 2019? Q1 2020 was very poor due to the onset of coronavirus.
2.
What are your best estimations for growth in the personal luxury goods in Q2 and Q3 2021 for mainland China?
3.
What are your best estimates for Gucci’s growth rates in mainland China, firstly in Q1 but also projecting ahead into the later quarters in 2021?
4.
Why is Gucci falling behind the market in China?
5.
As you say, Gucci announced a collaboration with Balenciaga. How attractive is this to the China-based customer?
6.
You mentioned Gucci’s aesthetic and the fashion cycle changing. Is there a shift in preferences in China from less Baroque to a more classic style?
7.
How could Gucci potentially offset this slowdown in momentum, particularly in China? What does Gucci need to do to increase brand heat?
8.
Why might Dior, Hermès or Chanel’s products be more attractive than Gucci’s for the China-based consumer?
9.
What are your rough estimates for online penetration for Gucci in China given your comments around how insignificant the online market is for luxury brands in China?
10.
What online growth are you expecting in 2021-23 relative to total growth, and how does that inform your overall assessment of online penetration levels in China for Gucci?
11.
How would you compare Gucci’s online channel to some of the additional megabrands we have discussed?
12.
How strong is Gucci in beauty and what are the opportunities to grow this category in mainland China?
13.
Alongside the slowdown in top line, there has also been a decline in the operating margin, at least at group level. When are you expecting margins to recover, and even if they will recover, and if you’re not expecting a full recovery, what do you think is a new normal from an operating margin perspective?
14.
How does the online channel impact the operating margin? How do online operating margins compare to in-store?
15.
Do you think Gucci could move away from its third-party model towards the direct online, similar to some of the other megabrands?
16.
What do you think is needed from Kering brand-wise? Is it more soft luxury, hard luxury, a younger brand or a more mature brand?
Gain access to Premium Content
Submit your details to access up to 5 Forum Transcripts or to request a complimentary one week trial.
The information, material and content contained in this transcript (“Content”) is for information purposes only and does not constitute advice of any type or a trade recommendation and should not form the basis of any investment decision.This transcript has been edited by Third Bridge for ease of reading. Third Bridge Group Limited and its affiliates (together “Third Bridge”) make no representation and accept no liability for the Contentor for any errors, omissions or inaccuracies in respect of it. The views of the specialist expressed in the Content are those of the specialist and they are not endorsed by, nor do they represent the opinion of, Third Bridge. Third Bridge reserves all copyright, intellectual and other property rights in the Content. Any modification, reformatting, copying, displaying, distributing, transmitting, publishing, licensing, creating derivative works from, transferring or selling any Content is strictly prohibited