What goes around, comes around. Certain designer labels, by keeping their foot so hard on the pricing accelerator in years of growth, have not only disappointed customers, but have targeted the “wrong” ones. This is not the first time Brunello Cucinelli has chastised his colleagues on the management of price lists, just as in the recent past he has called for “balance” in the relationship between the quality of the offer and the figure printed on the tags. But this time the Umbrian entrepreneur, who boasts 12.4% growth in 2024 (for 1.278 billion) and serenely expects +10 percent for the next two years as well, explains more precisely what the tactical error was: trying to focus on those who have the tools to decipher certain easy strategies.
Loss of affection
Among the many exogenous problems (wars, inflation, international tensions) there is one endogenous one that has contributed to luxury’s horrible 2024: prices. This is also confirmed by Vogue Business’ survey of a sample of 1,000 customers. 77% of respondents say they have a clear sense that price lists have risen in the past year, while 41% feel they are not getting a product of the right quality in return. On these assumptions, sentiment toward brands is “negative,” while the shares of the public who prefer to turn to second hand or discounting become significant.
The wrong customers
Cucinelli believes it was a cardinal sin (pictured Imagoeconomica) to betray the public’s trust. Especially since the same public could not remain forever indifferent to certain strategies that attempted to be cunning. “From 2019 to 2023, a key index such as ebitda rose up to 40%”, he tells Il Sole 24 Ore. “However, final prices grew up to double that percentage, a trend that could not last and led many consumers to move away”, and “not necessarily because they can’t afford the increases”. Quite the contrary. Because they caught on to the accounting trick. “Many of the customers of absolute luxury products, as we might call ours and others’, are people who invest in the stock market and know how to read a balance sheet“, Cucinelli concludes. Some may have noticed the exaggerations.
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