Digital Marketing Strategy Report: Gucci's Transformation and Analysis

This report analyzes Gucci's digital marketing strategy, exploring its transformation over the past 15 years. It begins with an introduction to digital marketing and its role in achieving business goals, followed by a PESTLE analysis of Gucci's operating environment, considering political, economic, social, and technological factors. The report then assesses the effectiveness of social media in building the Gucci brand, comparing its approach to that of M&S. Finally, it examines how modern organizations, like Gucci, integrate traditional marketing with digital marketing to achieve strategic objectives, discussing the advantages and disadvantages of each approach. The report concludes with a summary of findings and a list of references.

Digital Marketing
Strategy
1

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
PESTLE analysis.........................................................................................................................3
TASK 2............................................................................................................................................5
Effectiveness of the social web for building brands....................................................................5
TASK 3............................................................................................................................................6
How modern organizations integrate traditional marketing with digital marketing for achieving
strategic objectives.......................................................................................................................6
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11
2

INTRODUCTION
Digital marketing strategy is considered to be plan with different action for achieving up
the different digital marketing tools. This strategy will be explained in accomplishing business
goals by making proper improvements in the conversion rates or by increasing up lead
generation. A well-planned digital marketing will look into the brand highlighting against the
competitors eventually.
Companies are looking into complete digital transformation with integrated business plan
releasing up higher return on investments and revenues reaching out maximum potentials
customer. Gucci is a luxury brand and serves its products to high end customers who have
specific demand for a particular product. It has always delivered the best luxury products that
customer demands, including fur coat and leather bags etc. Gucci is the leading in UK
accounting around 25% of offline and about 43% in online sales. In this report there will be
discussion on the aspect how Gucci have been digitally transformed in last 15 years comparing
to its competitors. The report will also be using macroenvironmental analysing and comparison
between traditional and digital marketing with respective pros and cons.
TASK 1
PESTLE analysis
Gucci have digitally transformed the customer experiences, business model and operating one
through having continuous investments in the state of art website which is clicking and collected
functionality. The company have been successful in providing up digitalized in store
experiences and data driven customer loyalist programmes. The detailed analysis of Gucci has
aim up to look into the various factors such as political, economic, social, technological factors
that are affecting the firm digital strategy in today’s dates.
Political Factors/ Legal Factors
Gucci is the British retailer operating in the different countries such as Ireland, Hungary,
Poland, Slovakia, Malaysia, China, Czech Republic, and others. The company have home market
in the UK where the political environment is considered to be unstable after Brexit. This have
creation of major uncertainty is business in home market as well as overseas. Gucci is operating
in conductive business environments creating up the capability over appropriate responding on
3

the different current and future legislation. The UK have properly implemented up there the
consumer protection act to have stoppage of unfair practices which cannot misleads or harass up
consumers. There has been inclusion of business protection from marketing regulation 2008
stating to have stoppage over misleading digital advertisements. Gucci cannot use the
competitor’s logo trademarks or anything similar to this. This political norm is making
companies to compare product from competitors.
The UK governments have 2 advertising codes describing out business covering up all
promotional communication. The CAP non broadcast code has specific standard for accuracy
and honesty of business looking at specific condition such as advertising to children, causing
offense and political advertising. there are different roles enforcing advertising standard authority
(ASA) within 3 months of adverts appearing. The product has need to follow the proper
description or adverts break laws, Gucci will be prosecuted. Likewise, the higher rate in labor
cost particularly in UK and Ireland have been costing around millions of pounds every year.
The supermarket of the UK will be followed with watch dog is removal of such blocks in
business lifecycle effecting the digital marketing in every manner. as in term of digital
marketing Gucci have the need to be very much aware regarding counterfeiting issues faced by
customer. In the digital advertising it has been clearly mentioning that can be sued or fines for
misleading customer.
Economic factors: There are several economic factors that are affecting overall
performance of Gucci. It is found that this company faced several challenges related to skimmed
price and high insurance purchased sought after by customers. Gucci is a luxury brand. Some
economic factors like exchange, tax and others rates have affected in a positive manner. If Gucci
engage in international trade then the stability of currency is considered one of the important
factor as an unstable currency that may discourage international investors. All over it can be said
that most of the economic factors are in its favor.
Social Factors
Company have taken up the several initiatives in the recent years regarding changing up
customer belief and demands. Digital marketing is changing up the preferences of customer all
ways around. Nowadays customer is looking more into the shopping through online sales on the
4

official website of Gucci. this is the positive trends for the company to frame up the Digi
marketing in such manner looking major needs and wants. About 88% of consumers have logged
into an E-Commerce websites or apps using an existing social network account. on the other
hand, with increased trend in social media advertising, majorly people are Within mobile device
access, around 77% of social login is captured by Facebook (Google being 20%, and Twitter is
6%). This makes up Gucci to have pay attention of the focussing these important social media
sites in proper manner. The major revolution in women in UK should be proper guideline for
project aimed at safeguarding the rights of women, supporting the arts and protecting and
promoting health of children. On the other hand, as per the Kotter and Armstrong theory, Gucci
will have the A profile strategy is one that focuses an organization communication upon the
development of corporate image and reputation.
Technological Factors
Company having the domestic marketer in UK, Europe are facing up the major pressure from the
differ governments to make proper provision over adjustments with environments issues. In
addition to that public is more level concerned with increased carbon footprints. Company is
looking up in the technological innovation creating up various portal on various online portals
such as YouTube, Facebook, Twitter, Snapchat, Pinterest and Instagram. The firm is successfully
taking up digital transformation and advancements from the last 15 years in aggressive manner.
A variety of improvements in new technology would result in a reduction in cost of production,
for the products of Gucci which helps the company to further increase its revenues. In addition to
that digital marketing have to be framed up on basis of Gucci have created up self-service check
points providing up better convince to customer along with helping out company cost. Company
is invested in digital store devices creating up the better expansion of business in diverse manner.
TASK 2
Effectiveness of the social web for building brands
Social web is very effective in building brands this is because it provides several ways in which
organizations can build their brands. This means that social web allows organizations to connect
with their target market and along with this brand can also effectively express themselves on
social media. Other than this, social web has also facilitated reach to brand to larger audience and
5

every segment that organization targets because of increasing engagement of customers on social
media. Using social web for creating brand is also effective as through this brand can socially
proof them (Eric, 2017). This means that many customers presently seek their solutions on social
media sites and when customers find their solution on social media sites, company can reach and
connect with its target audience. Social web also allows for two-way communication in this not
just brand can reach to customers but customers can also reach to brands. This way, both can
communicate with each other and can also build positive and favorable brand image. Brands
through social web can also increase their exposure and generate leads and by this they can build
their brand. With all these ways in which social web prove to be effective for building brands
one of the most important element is that using social web also provide marketplace insight to
brands that is helpful in creating right strategies for organization.
In order to understand effectiveness of social web in building brands examples of Gucci and
M&S can be considered.
In relation with social web Gucci is effectively active on Facebook, Twitter, Pinterest and
Google. Gucci utilizes Facebook and has done effective work on it to create a brand and has its
timeline filled up attractive and engaging content (Pero, Sammy and Jones, 2016). Concerned
with Twitter Gucci operates separate account for each of its business units and also has separate
accounts for customer care, special offers, real food, Clubcard, wines and jobs. In context of
Pinterest Gucci also pins third party content rather than just promoting its content. Gucci started
late to use Google+ and also is not effective compared to its competitors.
M&S also uses Instagram in social web and in order to increase their organic reach it utilizes
feature of Instagram stories. These stories are aimed to create meaningful engagement with
customers. M&S considers that Instagram stories have a high impact way of reaching target
audience and driving awareness regarding innovation and product development. In relation with
social media and social web in effectiveness of building brands M&S has adopted approach of
digital first. This name and approach outline that M&S in its advertisements and marketing has
place strong emphasis on digital and social web and channels. With its effective and attractive
content M&S also have enabled audiences to engage and connect with M&S.
6

This comparison of these both channels outlines that M&S has effective social web
strategy compared to Gucci (Carville, 2018). M&S have also considered changing approaches
and preferences in social web and developed its strategy accordingly. Gucci is also performing
well but has effective scope in improving social web presence. However, both have managed to
build a strong brand.
TASK 3
How modern organizations integrate traditional marketing with digital marketing for achieving
strategic objectives
In the context of marketing, it can be said that it has become one of the main tasks and key of
companies’ success. Marketers have to perform several functions under this as they are mainly
responsible for promoting products and services of company and making customers aware about
them. The main aim of performing marketing function and considering it as the main key is it
helps companies in attracting towards buying products. There are 2 approaches or types of
marketing that are known as traditional and modern or digital marketing.
Traditional marketing: It refers all those types of marketing that is being done offline and in
which companies do not make use of internet and technology. Some examples via which
companies market their products under traditional marketing include: direct main, billboards,
print, phone, broadcast etc. This traditional method of marketing helps companies and retailers
like Gucci and Sainsbury’s in reaching customers and making them aware about effectiveness of
products and services. This method can be expensive because TV ads, ads in radios, printing cost
millions (Yanukovych and Yanukovych, 2020). There are only few and strong financial
capabilities of companies can afford this method. For more knowing effectiveness of this method
there is requirement for....to analyse it in a critic manner and it can be possible with identification
of advantages and disadvantages.
Advantages
Reach local customers: It is one of the effective methods of approaching local and target
customers. Among all of modes of communication and marketing, radio is considered the best
and affordable to advertise business.
7

Recyling possible: As compare to digital marketing it can be said that posters and all tangible
things can be reused after sometimes. Fliers, posters and pamphlets can be reused and it is its
other effectiveness.
Familiar mode: It is one of the oldest and familiar modes and if company is targeting old people
then it is known as the best way of marketing because in digital marketing, many people do not
have knowledge to use internet (KOLEV and JAKUPOVIĆ, 2018). So, in this method, Gucci
and other retailers can reach to all age group of people.
Greater exposure: This method is the oldest and has been tested many of the times and there are
several companies who have been succeed with this traditional marketing approach.
Disadvantages
Expensive: As compared to digital marketing traditional marketing is expensive because TV ads
and printing posters can cost millions. For even making changes in posters after sometimes as
per the requirement, company requires paying so, it can increase overall cost of the company.
Time consuming: This method of marketing is time consuming as compared to digital
marketing because in this type, marketers try to meet customers face to face and TV ads also take
time in generating leads.
Limitation to local customers: There are several modes in this type that are only limited to local
customers as company do not reach to global customers in this method (Meyer ding and
Melhuse, 2020).
Provide less information: In this traditional marketing method, it becomes difficult for
companies to present complex pricing options as well as offer for products. Print companies
charge according to per word and content used in message.
Digital marketing:
Marketing activities that are being performed with the help of internet and advanced technology
is known as digital marketing. All digital channels like websites, social media and others are
known as best examples or modes of digital marketing. This effective way of marketing gives
strategic advantage to companies because in this digital era they can compete with existing
biggest players in an effective manner. Technology is one of the main reasons of increasing
competition and that is why competition is moving from vertical to horizontal (Chaffey and
8

Smith, 2017). Overall, it can be said that any form of activities or marketing that involves
electronic devices are known as digital marketing. Nowadays many people use and access to
social media and that is why it is developing rapidly. Some advantages and disadvantages of this
method include:
Advantages
Global reach: Companies can reach to global customers by developing websites and uploading
images of products on social media platforms.
Lower cost: As compared to traditional method of marketing digital marketing is cost effective
method of marketing. There is no requirement of heavy investment as companies only require
developing or creating content that it needs to upload on social media and other platforms along
with products.
Measurable results: It is one of the main effectiveness as well as reason of Gucci and other
retailers to use digital marketing (Gorchakov and Gorchakov, 2016). With the help of social
media platforms and other channels, companies can measure their result and know their
effectiveness with the numbers of likes, reviews and traffic.
Detailed information: It becomes easier for marketers providing detailed information of
products and services that it wants to deliver to customers. Customers also find easier in taking
better decision.
Disadvantages
Time consuming: Traditional and digital marketing both are time consuming as uploading
images is not a difficult task but following them and reviewing all comments, giving answers to
customers’ questions can be complex sometimes.
High competition: There are several companies around the world that are now mainly focusing
on this method of marketing. Competition is increasing rapidly and it is its main limitation.
Security: In this type, all information related to company and customers are being kept and
stored in systems. It increases risks of security and hackers or other competitors may take undue
advantages of this information and it can create several problems for companies (Bhowmik and
Bag, 2017).
9

Complaints: Gucci and other retailers that make use of this marketing, provide opportunities and
options to their customers to share their views in comment box. As per the satisfaction level,
customers provide both positive and negative comments and there are several people who make
decision on the basis of comments. When people read negative comments then it has negative
impacts and can affect their buying decision.
In the context of Gucci, it is found that it makes use of both traditional and digital marketing for
accomplishing its goals and this combination makes it able to reach global customers and
increasing sales as well. According to the current situation and marketing type, it chooses
different types of marketing.
CONCLUSION
From the above file, it can be interpreted as Digital marketing strategy is accomplishing
business goals by making proper improvements in the conversion rates or by increasing up lead
generation. Gucci company have been successful in providing up digitalized in store experiences
and data driven customer loyalist programmes. Firm is successful adjusted business and
marketing policies according to change in business environment. Gucci have created up self-
service check points providing up better convince to customer along with helping out company
cost. This traditional method of marketing helps companies and retailers like Gucci and
Sainsbury’s in reaching customers and making them aware about effectiveness of products and
services. As compared to digital marketing traditional marketing is expensive because TV ads
and printing posters can cost millions. Nowadays many people use and access to social media
and that is why it is developing rapidly.
10

11

REFERENCES
Books and journals
Aiello, L.M and et.al., 2020. Gucci Grocery 1.0, a large-scale dataset of grocery purchases in
London. Scientific Data, 7(1). pp.1-11.
Bhowmik, S. and Bag, S.N., 2017. Prospects and scope of digital marketing in Indian industry: a
review. International Journal of Management Research and Reviews. 7(4). p.490.
Carville, M., 2018. Get Social: Social Media Strategy and Tactics for Leaders. Kogan Page
Publishers.
Chaffey, D. and Smith, P.R., 2017. Digital marketing excellence: planning, optimizing and
integrating online marketing. Taylor & Francis.
Evans, B. and Mason, R., 2018. The lean supply chain: managing the challenge at Gucci. Kogan
Page Publishers.
Gorchakov, T. and Gorchakov, Y., 2016. Digital Marketing and its Role in the Modern Business
Processes. European Cooperation. 11(18). pp.24-33.
Yanukovych, K.O. and Yanukovych, F.S., 2020. The main convenience of internet marketing
from traditional marketing. Academy. (1 (52)).
KOLEV, D. and JAKUPOVIĆ, S., NEUROMARKETING AND TRADITIONAL
MARKETING: DIFFERENCES AND ADVANTAGES. Yanukovych 2018 Skopje
2018, p.19.
Meyer ding, S.G. and Melhuse, C.M., 2020. Can neuromarketing add value to the traditional
marketing research? An exemplary experiment with functional near-infrared
spectroscopy (firs). Journal of Business Research. 107. pp.172-185.
Pero, S., Sammy, M. and Jones, B., 2016, September. Generating Customer Engagement and
Customer Enragement on Facebook Pages of Gucci and Walmart. In Conference on e-
Business, e-Services and e-Society (pp. 146-156). Springer, Cham.
Eric, M., 2017. Relationships between social Web, IMC and overall brand equity. European
Journal of Marketing.
Wood, S., Wrigley, N. and Coe, N.M., 2017. Capital discipline and financial market relations in
retail globalization: insights from the case of Gucci plc. Journal of Economic Geography,
17(1), pp.31-57.
Woo young, K., Hyun, K. and Hwang, J., 2020. Transnational Corporation’s Failure in China:
Focus on Gucci. Sustainability, 12(17), p.7170.
12