Case Study of Gucci Essay Example | Topics and Well Written Essays - 1750 words

Case Study of Gucci - Essay Example Most brands products of Gucci group of companies suffered a drop in sales in the wake of the 2008 economic crisis except the two strong brands whose sales increased even in the most extreme of circumstances. Due to the circumstances involving the general drop in sales volume and the traditional beliefs and sales concepts, it is important that Gucci explores the best marketing model or mix to employ so as to revamp the market. One of the popular marketing strategy/model is the Ansoff Growth marketing mix. This describes the growth of a business in its attempt to market new or regular products in a new market or previously existing market. It therefore brings together growth in the market and growth or increase in brand of an organization. Ansoff can be achieved through various strategies such as market penetration, market development, product development and product diversification (Pickton & Broderick 2005). Market penetration involves the marketing of the products or the specific br and in existing market with an aim of increasing the market proportion for the product which can be achieved through the 7 P’s of marketing. ... wear whose sales have dropped since they are neither producing new brands nor investing in a new market but trying to retain their market share amid a crisis. Under the Ansoff mix, marketing development is also a strategy which involves seeking new markets for an existing product. The methods used can include exploiting new geographical markets through exporting or setting up of outlets where they originally did not exist. The company can also adopt a new distribution channel which will ensure the product penetrates into the markets it did not attract. In this case, other methods such as differential pricing can be used to attract consumers of different economic or social status (Mao and Krishnan 2006). Since Gucci might have limited their market in terms of size, the company should consider increasing the market size for the product whose sales volume is on the decline so as to ensure a balance. Ansoff also includes product development where a company undertakes to introduce a new p roduct into the market and will require new competencies and modified products. Gucci is more concerned about its products which are on the decline but could choose to restructure their brands so as to produce more acceptable brands into the market and therefore avoid declining sales. Apart from all this strategies under Ansoff, the company may also opt for market diversification. This is a marketing strategy of exploiting totally new markets without prior experience or knowledge of the market. It is a risk venture which might result into unprecedented losses if not carefully approached but should be taken if circumstances demand. In the middle of the economic crisis, Gucci should not take this approach since it might result into more losses, especially the costs involved in promotion so as