Gucci comes to town
The best location for a luxury brand isn’t a five-star hotel, but a site cheek-by-jowl with it. That is what Italian fashion label Gucci concluded when launching its first India store—a sprawling 3,500-square feet outlet in South Mumbai that houses the entire range of Gucci products.
These include ready-towear collections for men and women, handbags, shoes, watches, sunglasses, jewellery, small leather goods, gifting items and other accessories. “We were very clear that we did not want to open our first store inside a five-star hotel. We wanted a place where we could get the entire range at one go; and we found Gallerie—in the business district of Nariman Point, almost touching the Hilton Hotel—an ideal location,” says Mark Lee, CEO, Gucci, which has partnered with the Murjani Group for this venture.
For luxury brands, having a large-size store in India has become an imperative. As Lee explains: “India is emerging as one of the fastest growing markets for luxury. We are confident that our 86-year heritage of high-quality, made-in-Italy, exclusive and innovative products will be appreciated by Indian customers.
India will become one of the most important countries for Gucci. The pace of growth and the size of this country are quite amazing.” Gucci is set to flag off two stores in Delhi, one by the yearend and another some time in the first half of 2008. Globally 70 per cent of Gucci’s sales come from its own stores.
Lee would be hoping that India can equal China in sheer growth, what with the latter proving to be the fastest-growing market in the world for Gucci. In 2006, Gucci grew 69 per cent in mainland China, which has 16 stores (up from four in 2004). It’s such growth that’s enabled Gucci to show robust double-digit growth in the past two years (18.4 per cent in 2005 and 16.8 per cent in 2006). Lee points out that the first half of 2007 too has seen double-digit growth. Asia-Pacific is the second-largest contributor to revenues, after Europe, pitching in with 22.2 per cent to revenues in 2006. The India entry will help further boost that figure.
Yet, Lee acknowledges that it won’t be all smooth sailing in the short term. “While luxury has arrived in India, organised retail is still not there. This country does not have a history of departmental stores; there is no history of segregated streets or areas for shopping. So there is a need in the coming years for organised retail.”
