PARIS: Consumers in Europe and the US have become less "ostentatious", and are also displaying declining levels of enthusiasm for products that prominently display brand names and logos, Robert Polet, ceo of Gucci Group, has said.
According to Polet, America and Europe are the areas which have "seen the biggest change in consumer behavior" since the onset of the economic downturn.
Prior to the financial crisis, an "exuberance took hold of everybody: buying three bags is not enough, let's go for five" was very much the mentality, he argued.
However, this situation has now been subject to a dramatic shift, meaning branded goods, particularly in high-end categories, will have to respond accordingly.
"Eighteen months ago, people were happy and wanting to have products that showed more the brand name and logos; let's say, slightly more ostentatious," said Polet.
Given the move away from these patterns of behaviour, Gucci has changed a variety of its designs and cut back the number of styles it offers – indeed, it has even started making "less ostentatious" handbags.
Among the more long-term areas of focus for the PPR-owned company are to assess if there are any potentially viable acquisitions available, and to strengthen its operations in Asia.
"As any good businessmen, we're looking at acquisitions and where we can complement our portfolio or not at the right price. So it's part of the long term but not part of the short term,” Polet said.
"For a long, long time to come, Asia will be the primary focus of Gucci Group investments. Emerging markets remain engines of growth. They might slow down slightly, but they're still growing."
In evidence of this, Polet reported that 22 of the 27 stores opened by Gucci in the first half of 2009 were based in Asia, a trend that is set to continue going forward.
Data sourced from Bloomberg; additional content by WARC staff