Daily Insights

Gucci Bets on Beauty

By: Alizah Asif Farooqi | May 06, 2019

Gucci is betting big on beauty—again. Five years after the brand first blossomed into beauty, it’s relaunching with a new lipstick line to be sold on its site and in select stores. But will the line live up to the gold standard Gucci has set for itself in fashion?

Besides fragrance, Gucci beauty has been fairly dormant for a few years. The new beauty venture arrives nine months after the introduction of @guccibeauty on Instagram. Initiating anticipation via Instagram is a smooth start for the brand, as there are currently 200 million beauty fans globally on the platform. So far, the new handle has harnessed the attention of 310,000 followers—minuscule as compared to Gucci’s 33.6 million—but a solid start considering a similar makeup page by luxury label Chanel has hooked just 153,000 since its premiere in February 2018.

In terms of timing, Gucci’s in a good place. The brand reported 20% annual growth in its most recent earnings report and the market for luxury and prestige cosmetics has seen double-digit growth each year for the past five years, despite (or perhaps because of) the growing trend for transparency regarding what consumers put on their face. Additionally, Gucci reported that over 60% of its sales come from millennials, showing the willingness of this demographic to spend money on luxury goods according to Gartner L2’s Digital IQ Index: Fashion Global. Still, because the beauty industry is so booming, it might be tough for Gucci to steal some of the spotlight if it only comes armed with lux labels and fancy names similar to its extravagance in apparel.

That said, over-the-top honesty might just be the best policy for Gucci’s new beauty line. The brand has already hinted it might employ such a strategy already by selecting punk band frontwoman Dani Miller as the face of its new campaign. The singer’s less-than-pristine pucker, enveloped in Gucci lipstick, is already sparking insecurity-smashing chatter on social media and could lend the line an air of authenticity that many other luxury brands might not typically take up.

Though singling out a specific kind of consumer that doesn’t necessarily match Gucci’s usual crowd might seem contradictory to the brand image, customizing the consumer connection has worked for it in the past. For example, Gucci used selective targeting based on email subscriber status to maximize its Helen Downie collaboration campaign. The two emails it sent out, one to highly valued customers and one to a larger list, differed in more than just the timing and the list of receivers. The first, more narrow email used personalized subject lines with customer names and selective loyalty language like “we invite you” and “special preview” to convert consumers through VIP privilege and access. It garnered a 27% open rate, higher than Gucci’s average open rate of 22%. The second, more widely distributed message used no loyalty language. Instead, it offered consumers the opportunity to shop the limited-edition collection after it already launched, achieving a slightly lower open rate of 16%, demonstrating how loyalty language and the effective use of customer data can go a long way in capturing consumers’ attention on email.

Only time will tell if Gucci comes out grinning in the end. But one thing is for sure: it will need more than just pretty products this time around.

See more: Beauty , Fashion , Gucci , Chanel