How One Sweater Can Cost Millions

September 30, 2019

Key Takeaways from the Wall Street Journal article – “As Gucci Tripped on Social Media, Sales Fell”

With one since-revoked controversial sweater, Gucci fans and foes, including celebrities, took to social media to show their dissatisfaction with the brand. This sweater mishap resulted in declining Gucci sales, proving the sheer importance of having a digital issues management plan and proper tools in place to put out these fires before they get out of hand.

What Happened?

Many brands use social media influencers and celebrities to reach audiences and create awareness for their brand. However, this past February Gucci marketed what was determined to be a culturally insensitive sweater.  This may have gone under-the-radar in pre-social media days, but today, proved very detrimental to the brand and its overall sales.

Celebrities and long-time fans of Gucci bashed the sweater on social media while urging followers to boycott the brand. According to this Wall Street Journal article published on 9-15-19, the backlash resulted in a drop in the brand’s comparable quarterly earned media value of $50 Million and its first quarterly drop in North American sales since early 2016.

Eric Sylvers and Suzanne Kapner of the Wall Street Journal writes, “Gucci, which sells products such as $300 wallets, $1,590 sneakers and $5,000 dresses, is particularly susceptible to social-media highs and lows because of its large base of younger customers. Morgan Stanley estimates that more than two-thirds of Gucci sales comes from millennials.”

Where Did It Go Wrong?

Using influencer marketing is one thing, but it’s a whole other beast when celebrities get involved. While using celebrities can be extremely beneficial in boosting your brand to a particular audience on social media, the same can be said when something goes awry.

Even just one celebrity’s negative response can tarnish a brand’s reputation. Rapper T.I., a “7 figure/year customer & long time supporter” took to Instagram to say, “Apology not accepted!” This post alone received 283,764 likes. He also posted a call-to-action image encouraging his fans to boycott the brand and live-streamed a discussion about the boycott with Women’s March Co-President Tamika Mallory.

Other celebrities like Spike Lee, Soulja Boy, 50 cent, and Lil Pump showed their outrage at the brand on social media, including posting videos burning Gucci products.

How Mishaps Like This Are Avoided, or at least Minimized

Gucci is not the first brand to make this grave mistake this year. Burberry, Prada, and Versace have also felt the heat after releasing culturally insensitive products that fans found offensive. With some preparation and planning, these design errors could have been minimized on social media.

In the digital age we’re in, simply recalling and apologizing is not enough. Your brand must act quickly where the trouble first surfaces – on social. Have a solid digital issues management plan and the proper tools in place to efficiently squash negativity before it spreads. Some ways you can do this are to:

  • Ensure that your brand is being proactive in avoiding controversial mistakes by having the brand, social, digital, and corporate communications team as closely involved as possible; let everyone be a part of the conversation to give all an opportunity to raise a red flag and prepare a risk management plan. Having these teams be part of integral conversations and planning will help them to take what happens offline and anticipate how it may transfer online.
  • Always use social listening tools so problems can be quickly identified, and then have response management plans in place to disperse information so you can quickly respond before things escalate and become out-of-control.
  • Include detailed message/approval maps in your response management plan that the proper response messages can be developed and dispersed quickly and effectively. Having an apology message isn’t enough on its own and it’s best to quickly acknowledge the situation before the rest of your crisis management plan unfolds.
  • Consider activating owned and earned influencers to help set the record straight and come to the brand’s defense. Well known and credible third-party voices can help ease issues and get the right message disseminated.

Gucci’s unfortunate situation exemplifies that even what’s done offline can quickly and dramatically escalate online – and affect the brands image, share, and profits in the process.  Mastermind has created a comprehensive digital issues management approach that can prepare brands for almost any possible challenge; we would be pleased to discuss the specifics of how your brand could benefit.

To learn more about our digital issues’ management approach click here.




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