I find that Jiazi Yang’s blog post — Gucci – not the “boss” which represents Kering anymore really interested. In this article, she demonstrates the situation that the sales of Gucci really made shareholders concerned because the sales decreased to 0.6% in the third quarter, and she says that she thinks the decrease of sales is due to the decline in demand and customers’ performances. However, I disagree with her opinion.

In my opinion, the demand of luxury is increasing continuously these years, and the number of people who can afford the luxury items is increasing as well. The continuously increasing price of most luxury products can prove my points as well. Therefore, I think the reason that caused the decreasing sales of Gucci is because Gucci overrated itself and want to take itself further upmarket. I find this move made by Gucci is a mistake that made by a misunderstanding about its brand positioning.

I think this example of Gucci shows the importance about the importance of first impression a company leave to customers, because once the brand image is formed, it’s really hard to replace it. For Gucci, customers already accept this brand as an second-line luxury and it is hard to change their mind, so if Gucci charge more, it would be hard for customers to accept that.