Updated: Dec 26, 2022
Gucci stated this week that: "Gucci is a digital-first luxury brand and this is the next phase of the company's Web 3.0 journey."
In the press release, Gucci announced that it will enable clients to pay with cryptocurrencies, including Bitcoin, Litecoin, Ethereum, and other niche forms, at its 5 US stores from the end of May. The chosen stores are: in Los Angeles, Las Vegas, Miami, Atlanta, and New York. Accordingly, Gucci intends to implement this new system at all North American stores this summer.
The brand has also released NFTs in collaboration with Bored Ape Yacht Club and a few other major players in the NFT world.
The news was outstanding as Gucci has become the first luxury brand to announce its acceptance of cryptocurrency payments. Over the years, the acceptance of the use of cryptocurrencies gradually and widely grew in many industries. Many other companies are trying to enlarge the virtual currencies' availabilities in the market; however, not many of them have made it possible to allow the use of digital currencies as their payment methods. Thus, the recent release about Gucci was more than unexpected and was enthralling for many Gucci fans.
But why has Gucci recently announced this? What are the intentions behind the new release?
There are plenty of predicted reasons why Gucci intends to start accepting cryptocurrency payments. Among these, nonetheless, one definite factor arises - to align with younger customers.
The company presumably wanted to stand out from other companies in the same market by being the first luxury brand to implement virtual currencies, it also intended to gain a rapid increase in the brand's reputation among young customers. According to Crypto exchange Currency.com, "31% of its clients are aged between 23 and 30 years, and 20% between 18 and 20." Because Gucci, alongside many other luxury brands, usually places young generations as its target audience, bringing out Millenials and Gen Z-friendly plans will be profitable for its business.
Is this going to be effective for the company?
While it is a great tendency in society that Gucci intends to grow ahead of others with a foray into the virtual currencies, there may be some obstacles the company will face. Cryptocurrencies are unstable in price, and the company needs to evaluate whether they will positively affect its sales.
Thank you for reading this week's post.
I will be away next 2 weeks because I will be having school exams but will be back soon :) Thank you for your understanding.