Luxury Brands, Essay Example

How luxury brands can communicate their ethics face to an increasing number of consumers who request this information?

Introduction

It is important for luxury brands to effectively communicate their ethics towards individuals in order to more effectively market their products. It is important for luxury brands to continue to differentiate themselves in light of new challenges that they constantly face. A growing trend among individuals who purchase luxury goods is that they want to be aware that no people or animals were harmed in the making of the product. Historically, clothing brands did not need to be concerned with such ethical initiatives because less clothing options were available and information was not previously communicated as quickly or efficiently. However, in the modern setting, there is a need for luxury brands to publicize themselves in a favorable light because this contributes to their increased presence on the Internet and as a component of other news sources.

Gucci is an Italian company that is currently a component of the French owned company, Kering. It was founded in Florence in 1921, indicating that the organization has a sufficient history (Bianchino et al. 3). As of 2008, the company boasted a revenue of 4.2 billion euros, making it one of Europe’s top brands. Overall, the organization operates more than 280 stores around the world, in addition to having its products featured in many department stores across the world as well. In order for the company to continue its current level of success, it will remain important for the organization to maintain a comprehensive understanding of its target customers. Since these individuals are often concerned about what is trendy in the fashion world, it is also important to consider that these individuals are concerned with beliefs that are considered to be trendy in the political and activist realms as well. Therefore, it will remain important for Gucci and related companies to remain socially conscious. While this study will focus on Gucci as a case study to denote specific movements that have been implemented by the company to remain positive in the eyes of the public, suggestions will be taken to conclude what is being done right about its initiatives and what should be added to these initiatives to ensure that the company is able to remain successful.

Gucci’s Current Social Controversy

It is known that Gucci does not engage in ethical labor practices. In particular, critics of the company claim that “labor abuses are allowed to occur and persist in foreign-invested firms that are located in the People’s Republic of China” (Wang et al. 1). The Chinese people are frustrated about this, especially because the retailer is attempting to extend its presence onto the Chinese mainland. These individuals intend to persuade the company that its business practices within the nation are not ethically acceptable, and people of the nation are currently determining how they could discontinue and/or prevent the labor abuses that are currently occurring within the nation.

It is important to consider that a primary goal of many luxury retailers is to appear wholesome in the eyes of consumers. However, these reports that have been released by the People’s Republic of China indicates that even though the company wants their image to be considered positive, these organizations are willing to compromise ethics in order to make a more significant profit. Investigative reporting determined that Gucci was aware that its Chinese worked were employed in their factories for more than 14 hours at a time. Therefore, the goal of ethical initiatives is to ultimately make more money. The idea is that if more people view Gucci and other luxury clothing retailers in a positive light, they are more likely to be able to gain and retain customers. It will be imperative for the organization to reverse what is currently being said about them in the public domain because such negative reports have the ability to impair business.

An additional controversy that brought attention to Gucci is its recent lawsuit against Guess for trademark infringement. The company claimed that guess did not have the right to use the GG logo because it was already trademarked. Additional companies have attempted to revoke the trademark because it was also in align with their company names, but Gucci ultimately retains the rights to its logo (Famous Logos 1).

Gucci’s Current Social Consciousness Approach

In a response to the many complaints that have been issued about the company, Gucci has attempted to market itself as a leader in social responsibility and sustainability. According to Luxury Society, the organization has always been a positive supporter of animal welfare. “When it comes to precious skins and furs – a long time hallmark of the Gucci brand – its goal is for 100% to come from “verified captive-breeding operations or from wild, sustainably managed populations,” where suppliers employ “accepted animal welfare practices and humane treatment in sourcing” (Luxury Society 1). On the other hand, it is important to consider that the organization’s fragrances division does test on animals (PETA). Furthermore, ensuring welfare for animals does not mean that it does not use animal products. However, it is evident that the company is able to market itself in a manner that does promote animal welfare.

It is beneficial for luxury clothing companies to market themselves in an animal friendly manner because it is important for them to remember that there are many animal welfare organizations present that would be willing to provide negative media coverage for the company if it is found that they are engaged in any practices that would cause harm to animals. Based on current reports, it is apparent that the organization’s animal friendly stance is not necessarily 100% true, but the company aims to show itself in a light that shows that it cares and that it is taking necessary steps to reduce the harm that its clothing products cause towards animals. While it is unlikely that the company will eliminate the use of animals altogether in the manufacturing of its products, it will ensure that these animals are being treated well until they are utilized for this purpose. Furthermore, the organization is not contributing to the extinction of species because it breeds all of its own animals.

Luxury Society also explains that, “In 2004, Gucci was one of the first companies in the industry to voluntarily initiate a Corporate Social Responsibility (SA 8000) certification process for its entire production cycle. According to the brand “this certification – relating to the leather goods, jewellery, footwear and clothing supply chains and to the logistics hub – stands for values such as business ethics, respect for human rights, workers’ health and safety, and equal opportunities” (Luxury Society 1). Such an initiative makes it appear that Gucci is on the forefront of ethical practices because voluntarily accepting this form of social responsibility helps the company show that it is willing to make changes to its practices. However, even though the initiative was launched in 2004, the People’s Republic of China were still complaining about Gucci’s business practices into 2012. Therefore, it is apparent that while change may have been made in some regards, this change has not been covered across the board.

Although Gucci’s social responsibility initiatives may not have been as effective in some locales, the organization is well-known for contributing to charitable funds. According to Luxury Society, “Gucci are particularly active in philanthropy relating to women’s issues and girl’s education. To date Gucci has contributed over $10 million to UNICEF during an eight-year partnership, through a mix of charitable donations and by creating ‘UNICEF’ products, whereby 25% of the retail proceeds are passed on to the charity” (Luxury Society 1). This is an ideal way for the organization to demonstrate that it is involved in positive social change. By showing that it uses portions of its income to support populations in need, it is able to generate a more committed customer base. Furthermore, this initiative appears to be genuine; no news sources are present that contradict the efforts that the organization has put forth in this regard.

Social Media Activism and Sustainability

Recently, blogs have played a major role in ensuring that fashion industry leaders are aware of the wants and needs of consumers. Popular blogs function by posting new articles to help bring these sustainability issues to light, while providing a forum for discussion on these topics. Some of these blogs even provide readers with a way to contact fashion companies to make their concerns heard. One such blog is called “Fashion Revolution”. By providing a coherent argument to fans of fashion industry and backing up this information with reliable sources, such blogs are able to promote a following that call fashion lovers into action.

A recent article on the Fashion Revolution blog explains that American traditions, such as the Black Friday shopping tradition, are environmentally unsustainable (Anjum, 2015). The goal of the article is to provide consumers with a compilation of information about how Black Friday promotes overproduction, which leads to environmental harm as a consequence of the chemicals released into the environment and the water used to make mass amounts of clothing. Furthermore, the site calls readers to action by asking them to question their personal shopping habits and determining how changes could be made to reflect sustainability goals. In addition, the site asks consumers to contact the clothing industry directly to ask them about how their clothes are made and whether this reflects environmental sustainability. Media sites allow consumers to be more aware of the products that they purchase, and as a consequence, their contribution to environmental standards.

It is beneficial for companies like Gucci to be aware of such activism and have a response prepared for these individuals. The best way for organizations to be accountable to their customers are to use social media sources to determine what their opinions really are. Since there is a growing trend towards sustainability, it will be important for luxury brand manufacturers to be prepared to make relevant changes.

The Fashion Industry and Sustainability

Gucci’s attempt to market itself as a sustainable brand is reflective of the needs of a variety of high end clothing organizations across the world. Many of these companies have not traditionally engaged in ethical practices, but it is becoming more important for them to become involved in ethical action to promote their brand. Gucci has done this by getting celebrities like Beyoncé to become involved in its fundraising efforts for charitable organizations. Not only does this market the organization in a favorable light, it recruits a celebrity as a member of the campaign, which allows individual to associate the brand with celebrities that they enjoy.

Many fashion organizations are becoming increasingly involved with efforts to make their production practices more sustainable. Not only does this help market these organizations as environmentally conscious, it also helps them meet governmental regulations with regards to manufacturing. Gucci claims that it has a plan in place to make its manufacturing processes more sustainable, but this plan has not yet been formally published. According to environmental scientists, “Second to oil, fashion and textiles is the most polluting industry in the world. Every stage in a garment’s life threatens our planet and its resources. It can take more than 20,000 litres of water to produce 1kg of cotton, equivalent to a single t-shirt and pair of jeans. Up to 8,000 different chemicals are used to turn raw materials into clothes, including a range of dyeing and finishing processes” (Business of Fashion 1). Therefore, there is a clear need for clothing companies, not just luxury brands, to take actionable change. As the demand for textiles increases with the growth of the population, the pollution that this manufacturing contributes to will cause detrimental impacts on our environment. It is therefore necessary for companies to enact social responsibility and be a part of the change, rather than being a part of the problem.

While many individuals do not believe in global warming, even more individuals counteract the validity of the idea because they are concerned that taking sustainable steps will negatively impact their business practices. However, as history has indicated, manufacturing practices has contributed to the pollution of the immediate environment in a manner that causes irreversible change. During the Industrial Revolution, for example, London was shrouded in smog and ladies would avoid wearing white because they knew that their clothes would appear dirty (Steele 85). Instead, they wore black to hide the appearance of this factory byproduct on their clothing. Environmental standards and sustainable action have effectively reduced the need for individuals to dress in this manner today. However, if care is not taken to act in an environmentally responsible manner, it is possible that environmental conditions will reverse back to the ways they were during this time period. As a consequence, the environment will suffer and contribute to many of the negative impacts, such as temperature changes and the rise of sea levels that are common today. Overall, it is important to consider that it is better to enact change and sacrifice immediate profitability to ensure that the world is a better place in which to conduct business. Gucci would therefore benefit by establishing a concrete sustainability policy that will detail actionable goals to reduce the impact of its manufacturing processes on the environment.

Strategies to Communicate Ethics

In the modern setting, companies can now market their ethical strategies more easily than ever. A majority of these organizations have the opportunity to boast about their initiatives on their company website, which provides customers with an enhanced ability to access pertinent information on this topic. Furthermore, online marketing is becoming more common. Many articles that discuss companies in a positive light are actually forms of marketing. Thus, when one does an Internet search for “Gucci” and “ethics”, a series of articles will arise (Pollitt 1). Many of these articles will have been written by the organization itself and promoted as news articles to spread the message. This is a commonly used form of marketing today, considering that a majority of people now get their news from Internet resources.

An additional way to communicate ethical strategies is to involve people and celebrities in their initiatives. Gucci famously involved Beyoncé in their attempt to fundraise for UNICEF, which not only marketed to Beyoncé fans, but provided a means for these individuals to discuss the brand and their initiative with their friends (Talarico 1). Since Gucci and similar luxury clothing brands are marketed through word of mouth tactics to begin with, doing so to communicate ethical initiatives is an effective way of achieving this goal. To further this aim, the organization could encourage their followers to tweet, post Facebook statuses, and blog about their initiatives in order to spread this news through fashion insiders on social media.

Ethics Spread in the Fashion Industry as a Global/Social Phenomenon

As environmental and ethical demands are changing within the world at large, it will become more necessary for companies like Gucci and their competitors to meet the demands of their customers. As a consequence, brands that are likely to remain competitive in the future are those that will be able to do so in a manner that most significantly appeases these members of the public. The consumer now has more power that she ever has before. Just as organizations use social media tools in order to promote their messages, the individual has the ability to spread a message quickly through the Internet in an attempt to correct wrongs and promote awareness. It is now more challenging for leading organizations in the fashion industry to hide their actions and it is more necessary for them to change their actions in a manner that will make their consumers happier.

Instead of selecting the products that consumers believe to be the most fashionable, many consumers will now purchase from brands that they believe support their personal beliefs. Many vegans and vegetarians have now completely stopped purchasing clothing from stores that use animal products, while a number of individuals have stopped providing business to organizations that use sweat shop workers. There is a growing sense of connectivity between people and the environment across the world and these understandings help direct the choices of consumers more than they ever have in the past. It will remain important for companies like Gucci to recognize the extent of this occurrence and to act in a manner that appeases the public. To ensure that the company is able to remain competitive in the changing global climate, several recommendations have been created for Gucci and luxury clothing companies of a similar status below.

Recommendations

It is recommended that Gucci and other luxury clothing brands put forth an effort to refine their manufacturing processes in order to ensure that they are more environmentally friendly. Such practices could include refining manufacturing to use less water in addition to chemicals that have the potential to cause environmental contamination and solution. Furthermore, it is important for the company to uphold a greater extent of ethical standards with regards to the workforce that produces their clothing. It is challenging to determine whether Gucci still requires its employees in China to work extended hours, but it will be important for the organization to instantly reverse these practices and put forth publications demonstrating how these working conditions have changed for the better (Za 1). It will also be beneficial for other luxury clothing vendors that have this type of workforce in place to reverse these practices to avoid the negative press that it associated with it. Last, it is beneficial for these companies to demonstrate that they are using some of their funds in order to enact positive social change. Gucci is already doing this by becoming involved in fundraising efforts for UNICEF, but it will be beneficial for other luxury brand companies to follow in its lead. Overall, an ability to engage in sustainable and ethical practices correlates with an ability to continue to succeed in the current market. It is important for luxury clothing companies to recognize that business practices that allowed them to be successful historically are no longer relevant. Thus, it will be necessary for them to pilot new ethical initiatives in order to ensure positive change. Companies that are able to achieve this goal are likely to survive into the future, while those that are not will suffer from the consequences of negative press. In today’s society, people are able to demand what they want from their retailers in a manner that has never been possible before. Thus, luxury brand clothing companies must rise to meet this challenge.

Works Cited

Anjum, M. Sustainable Development – A Question Of Changing Our Beliefs And Attitudes. 23 November 2015. Web. 23 November 2015. <http://fashionrevolution.org/sustainable-development-a-question-of-changing-our-beliefs-and-attitudes/>

Bianchino, G., et al. Italian Fashion. The Origins of High Fashion and Knitwear. Milan: Electa SpA, 1(1987): 1-4.

Business of Fashion. How can the fashion industry become more sustainable? 29 March 2015. Web. 22 November 2015. <http://www.businessoffashion.com/community/voices/discussions/can-fashion-industry-become-sustainable>

Famous Logos. Gucci Logo. N.D. Web. 22 November 2015. <http://famouslogos.net/gucci-logo/>

Luxury Society. Gucci Steps Towards Sustainability. 29 Jan 2014. Web. 22 November 2015.<http://luxurysociety.com/articles/2014/01/gucci-steps-towards-sustainability>

PETA. Gucci Fragrances. N.D. Web. 22 November 2015. <http://features.peta.org/cruelty-free-company-search/cruelty_free_companies_company.aspx?Com_Id=3429&Donottest=- 1&Product=0&Dotest=-1&RegChange=-1&Country=-1&Keyword=Procter+%26+Gamble>

Pollitt, C. Everything You Need To Know About Sponsored Content. 20 January 2015. Web. November 2015. <https://moz.com/blog/everything-you-need-to-know-about-sponsored- content>

Steele, V. Paris fashion: a cultural history. Oxford: Berg, 1998.

Talarico, B. Katy Perry, Blake Lively Join Beyoncé and Gucci to Empower Women. 17 April 2013.Web. 22 November 2015. <http://stylenews.peoplestylewatch.com/2013/04/17/katy-pery-blake-lively-beyonce-gucci-campaig/>

Wang, L., Snell, R.S. A case study of ethical issue at Gucci in Shenzhen, China. Asian J Bus Ethics, (2012): 1-12.

Za, V. Gucci to check Chinese suppliers after TV exploitation charges. 22 December 2014. Web. November 2015. <http://www.reuters.com/article/2014/12/22/us-kering-gucci-suppliers- idUSKBN0K01I120141222>