Gucci Follows LV in Raising Prices: Some Popular Bags See Over 10% Increase

“We generally raise prices every year, especially for some of the best-selling products. However, this time, not all items are affected. Every category still has stock available,” a sales associate at Gucci’s Beijing Financial Street shopping mall explained on September 29.

Another salesperson at a Gucci store mentioned that prices for some 2024 new releases haven’t been changed. However, popular items, like the Marmont series bags, have seen price hikes. For instance, a Marmont Supermini bag increased from 8,700 RMB to 9,800 RMB, reflecting a rise of 12.6%.

Previously, Kering Group stated that they did not anticipate a significant increase in Gucci’s prices for 2024.

Gucci’s revenue declined, and Kering Group’s 2023 financial results fell short of expectations.

On May 8, Kering Group, the parent company of Gucci, announced its 2023 earnings. The company recorded total revenue of €19.566 billion, down 4% year-over-year. Net income dropped from €3.614 billion in 2022 to €2.983 billion, missing analysts’ forecast of €3.17 billion and marking a 17% decline. Kering’s fourth-quarter revenue fell 6% year-over-year to €4.97 billion.

As Kering’s flagship brand, Gucci’s revenue for 2023 was €9.873 billion, a 6% drop year-over-year. On a comparable basis, the decline was 2%. Kering reported that the performance across most of Gucci’s product categories showed little to no growth in 2023, primarily due to a shift in product structure and price increases, which raised average prices but offset lower sales volumes. Despite this, the leather goods segment, particularly women’s accessories, showed strong performance, while entry-level products like small leather goods, shoes, and gucci belts saw weakening demand.

Asia-Pacific (excluding Japan) and Japan were the only two regions to experience growth throughout the year.

China, part of the Asia-Pacific region, remains Kering’s largest market. In 2023, the region contributed €6.848 billion, accounting for 35% of the company’s total revenue. Kering disclosed during an earnings call that China’s sales increased by 35% in Q4 2023 and 34% for the full year, driven by a rebound in outbound travel. However, overall recovery was below expectations.

Kering also mentioned during the earnings call that Gucci’s prices are not expected to rise significantly in 2024. To maintain brand value, Kering plans to reduce discounts and may begin reducing the number of Gucci outlet stores as early as this year.

LV Increased Prices Earlier, Popular Handbags Saw a 5% Rise

On September 19, reports surfaced that Louis Vuitton, the French luxury giant, raised prices for certain products in the Chinese market on August 19, with an average increase of around 6%.

According to reports, LV’s official customer service confirmed that prices for some products have indeed been updated both online and in-store. For example, the Carryall small bag rose from 19,600 RMB to 20,600 RMB, reflecting a 5.1% increase. The medium size Carryall went from 20,500 RMB to 21,500 RMB, a 4.8% rise. Other product categories saw varying levels of price hikes.

The BOULOGNE bag, for instance, saw a price increase of 900 RMB, with the official price now at 19,400 RMB, up from 18,500 RMB previously.

It’s noteworthy that LVMH’s CFO Jean-Jacques Guiony stated in the company’s latest earnings call that they decided not to raise prices again to balance costs and profits. However, they won’t offer discounts either, ensuring the impact on profits remains neutral.

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