Designers Switching Houses & Moving to New Brands
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LadyJunon
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Finally! At this point, I'd accept anyone.
tourbillions
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are they finally announcing sabato de sarno as creative director of lanvin and that gucci will remain on autopilot until the find a new cd?
PDFSD
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Marco Gobbetti gets a second chance at Ferragamo
Astrid Wendlandt / Miss Tweed
28/04/24
Why did the Ferragamo family reappoint Marco Gobbetti this week as CEO of the Florentine brand for another three years? Ferragamo’s performance did not live up to expectations in the two years he’s been in charge. Sales are in freefall, and so is the share price. The brand’s identity is blurred. The Italian executive keeps promising things will improve and is handsomely paid - between €8 million and €10 million a year - but you wonder when Ferragamo will actually take off and where it’s going.
The Milan-listed company has been unofficially for sale for several years now, banking sources say. Nobody wants to buy it. Industry players LVMH, Kering and Richemont have not expressed any interest. They know how hard it is to bring back its former glory, particularly with the Ferragamo family so entrenched and constantly fighting to get back the power it's given the CEO.
Bankers say the family want at least €3 billion. On the stock market, Ferragamo is worth €1.61 billion, or 30 percent more than its 2023 net annual sales of €1.12 billion. Last year, revenue was down 8.1 percent at constant exchange rates and operating profit fell 44 percent to €72 million.
The company's share price has lost 40 percent in the past year. On Friday, Ferragamo shares closed at €9.52. In January 2022, when Gobbetti started as CEO, they stood at €22.77. While many luxury brands have seen their sales and share price double or triple in the past decade, Ferragamo's turnover never went beyond its 2016 peak of €1.438 billion and its share price is now worth less than a third of its April 2015 record of €31.85.
To be fair to Gobbetti, revamping a fashion house in a downturn is challenging. He's also had to offload old stock at discounted prices through outlets which artificially boosted sales but harmed image. So what happens next? Gobbetti needs to decide who is Ferragamo's target customer. Is it the young fashionista or the affluent buyer looking for timeless and high-quality products.
Gobbetti made Ferragamo abandon its glamorous and ultra-feminine Florentine roots and gave it a modern, urban and minimalist identity under the creative leadership of Maximilian Davis,a British national with Trinidadian and Jamaican roots.
The brand's ad campaigns have been going in different directions. In 2022, its imagery was very black and red and slightly futuristic. Last year, models posed in front of famous Renaissance artworks from Florence's Uffizi Galleries. This year, it produced photo shoots in classic interiors with dimmed light featuring supermodel Natalia Vodianova,who is the wife of LVMH scion Antoine Arnault. "The fact that the brand keeps changing its message and its ad campaigns are so different is a sign that it has not yet figured out what it wants its story to be," one Milan-based fashion expert said.
Ferragamo lost Salvatore as part of its name - like Saint Laurent lost Yves - and replaced its traditional burgundy red with the same flashy red that luxury car maker Ferrari uses.
It also threw out its trademark handwritten logo and adopted one that looks like that of several other brands, including Burberry and Balenciaga.
IT'S ALL ABOUT SHOES
Gobbetti wants Ferragamo to be a fully fledged fashion brand that also sells jewelry. Yet its reputation is in shoes. That's where its legitimacy lies. Let's remember that Salvatore Ferragamo rose to fame in the 1950s and 1960s when he was the shoemaker to the stars and personally looked after celebrities Sophia Lauren, Audrey Hepburn and Rita Hayworth. Last year, shoes represented 45.7 percent of Ferragamo's net sales. In the past, several luxury shoe brands have tried to become fashion brands, but they never succeeded. Switzerland's Bally, which has been looking for a buyer since 2017, and LVMH's Berluti are good examples.
Davis is recognized by the fashion crowd as a talented designer but that does not mean he's figured out what Ferragamo is about. His vision is sharp and edgy. Ferragamo now offers shoes and bags in bright colors that are cosmopolitan and may appeal to young customers, but its personality has become somewhat cold and severe.
Davis' looks are clean and elegant, but there is little reference to Italy, let alone Florence, where the brand was founded in 1927. When you buy Ferragamo shoes, bags or clothes, you want to buy a bit of Italy. Even the products don't have Italian names. One of its new totes is called the Hug bag. Its design is somewhat similar to Hermes's bags with the same emphasis on buckles.
The brand's new identity has scared away the traditional consumer who loved its elegant silk scarves and bow-tipped ballerinas. Today, the cohort of new followers are not big enough to compensate for departure of the old buyers. Ferragamo is struggling to rebuild traffic after having remained irrelevant from a fashion point of view for so many years, industry analysts say.
LOOKING BACK
For most of the past two decades, influential members of the Ferragamo family would not let go of the vision they had of the brand's golden age from half a century ago. In terms of style and image, they did not want it to stray too far away from that period. As a result, the brand looked old and customers thought it was for their grandmothers. Before the pandemic, the brand was dying a slow death and inertia was not an option.
Ferragamo needed a creative disruption, but it's turned out to be too radical and extreme for consumers to adopt and understand. "Davis is a great designer but I think he's not been briefed correctly, one former senior Gucci executive said.
Gobbetti was previously CEO of Burberry starting in 2017 and jumped ship after four years without completing the turnaround of the British brand for which he was hired.
Before Burberry, he spent 13 years at LVMH, running Givenchy with Ricardo Tisci as a designer, and later Celine with the acclaimed Phoebe Philo.
Gobbetti took Ferragamo's executive reins in January 2022 with a lucrative package. In 2022, his total remuneration reached €9.84 million, according to the company's annual report. That was three times more than what he made at Burberry. Plus, luckily for the 64-year-old Italian, who spent nearly 20 years abroad, he was entitled to the tax break reserved for Italians who return home. Starting in 2022 and for seven years, he became eligible to pay a flat 15 percent tax rate on his income - a third of what he was charged in the UK or what most wealthy Italians pay.
In 2023, Gobbetti received €8.2 million and was awarded shares last year and this year. That amount is more than the operating profit the Italian fashion company made in the first quarter of 2021.
Industry sources say one of the reasons why the Ferragamo family decided to renew his contract is because it would cost them too much to let him go. Gobbetti is said to have negotiated an excellent deal for himself. Several industry sources say he could claim at least two year's worth of salary if the family asked him to leave. Hence, best to keep him. Also, Ferragamo's revamp is only two years old. Might as well give Gobbetti more time to improve the brand's performance and his own track record
PATIENCE
Still, in recent months, patience among the Ferragamo clan has been running thin. Tension between Gobbetti and Leonardo Ferragamo, chairman of the board and son of founder Salvatore, have grown due to the brand's poor results, several senior industry sources have said. "Tensions between the Ferragamo family and Marco Gobbetti are super high," one of those sources said. So much so that the family forced out Gobbetti's trusted Chief Marketing Officer Catherine Vautrin last month. Vautrin was replaced by Michela Ratti, who was CMO of Ferragamo six years ago and worked for eBay, Swarovski and Procter & Gamble.
The company declined to confirm Ratti's appointment and did not reply to Miss Tweeds requests for comment. Ousting Vautrin is a sign the family is trying to take back some of the power it conferred Gobbetti when he took the executive reins.
"My understanding is that the family have lost faith in Gobbetti but they cannot let him go for now," one former Ferragamo senior manager who still has contacts with staff at the company told Miss Tweed under condition of anonymity. One of Ferragamo's problems is that more than 10 family members are still in key positions and continue to influence matters ranging from image to product and distribution - even though insiders suggest they are not all qualified for such tasks. "Many of them do not have the competencies to run a luxury company,' the former Ferragamo manager said.
When Gobbetti was hired by the Ferragamo family, he was regarded as the savior who could give the brand a new relevance. Before Gobbetti, the family would never let the CEO take decisions and craft a coherent roadmap. His predecessor Micaela Le Divelec Lemmi struggled to get the family's full backing and cooperation, industry sources said at the time.
Could it be that Gobbetti made the same mistake he did at Burberry - hiring a designer who did not really understand the brand? Designer Daniel Lee, in place for a year, is on a mission to reconnect Burberry with its British roots after years of lackluster performance under Ricardo Tisci. The Italian designer developed an metrosexual and sporty identity for Burberry that did not suit the brand, fashion critics and industry experts say. Gobbetti, who worked with Tisci before at Givenchy, was the one who chose the Italian designer for Burberry.
Whatever happens to Ferragamo, Gobbetti sitting pretty from a financial point of view. His concern now is his reputation and track record - things money can't always buy.
Astrid Wendlandt / Miss Tweed
28/04/24
Why did the Ferragamo family reappoint Marco Gobbetti this week as CEO of the Florentine brand for another three years? Ferragamo’s performance did not live up to expectations in the two years he’s been in charge. Sales are in freefall, and so is the share price. The brand’s identity is blurred. The Italian executive keeps promising things will improve and is handsomely paid - between €8 million and €10 million a year - but you wonder when Ferragamo will actually take off and where it’s going.
The Milan-listed company has been unofficially for sale for several years now, banking sources say. Nobody wants to buy it. Industry players LVMH, Kering and Richemont have not expressed any interest. They know how hard it is to bring back its former glory, particularly with the Ferragamo family so entrenched and constantly fighting to get back the power it's given the CEO.
Bankers say the family want at least €3 billion. On the stock market, Ferragamo is worth €1.61 billion, or 30 percent more than its 2023 net annual sales of €1.12 billion. Last year, revenue was down 8.1 percent at constant exchange rates and operating profit fell 44 percent to €72 million.
The company's share price has lost 40 percent in the past year. On Friday, Ferragamo shares closed at €9.52. In January 2022, when Gobbetti started as CEO, they stood at €22.77. While many luxury brands have seen their sales and share price double or triple in the past decade, Ferragamo's turnover never went beyond its 2016 peak of €1.438 billion and its share price is now worth less than a third of its April 2015 record of €31.85.
To be fair to Gobbetti, revamping a fashion house in a downturn is challenging. He's also had to offload old stock at discounted prices through outlets which artificially boosted sales but harmed image. So what happens next? Gobbetti needs to decide who is Ferragamo's target customer. Is it the young fashionista or the affluent buyer looking for timeless and high-quality products.
Gobbetti made Ferragamo abandon its glamorous and ultra-feminine Florentine roots and gave it a modern, urban and minimalist identity under the creative leadership of Maximilian Davis,a British national with Trinidadian and Jamaican roots.
The brand's ad campaigns have been going in different directions. In 2022, its imagery was very black and red and slightly futuristic. Last year, models posed in front of famous Renaissance artworks from Florence's Uffizi Galleries. This year, it produced photo shoots in classic interiors with dimmed light featuring supermodel Natalia Vodianova,who is the wife of LVMH scion Antoine Arnault. "The fact that the brand keeps changing its message and its ad campaigns are so different is a sign that it has not yet figured out what it wants its story to be," one Milan-based fashion expert said.
Ferragamo lost Salvatore as part of its name - like Saint Laurent lost Yves - and replaced its traditional burgundy red with the same flashy red that luxury car maker Ferrari uses.
It also threw out its trademark handwritten logo and adopted one that looks like that of several other brands, including Burberry and Balenciaga.
IT'S ALL ABOUT SHOES
Gobbetti wants Ferragamo to be a fully fledged fashion brand that also sells jewelry. Yet its reputation is in shoes. That's where its legitimacy lies. Let's remember that Salvatore Ferragamo rose to fame in the 1950s and 1960s when he was the shoemaker to the stars and personally looked after celebrities Sophia Lauren, Audrey Hepburn and Rita Hayworth. Last year, shoes represented 45.7 percent of Ferragamo's net sales. In the past, several luxury shoe brands have tried to become fashion brands, but they never succeeded. Switzerland's Bally, which has been looking for a buyer since 2017, and LVMH's Berluti are good examples.
Davis is recognized by the fashion crowd as a talented designer but that does not mean he's figured out what Ferragamo is about. His vision is sharp and edgy. Ferragamo now offers shoes and bags in bright colors that are cosmopolitan and may appeal to young customers, but its personality has become somewhat cold and severe.
Davis' looks are clean and elegant, but there is little reference to Italy, let alone Florence, where the brand was founded in 1927. When you buy Ferragamo shoes, bags or clothes, you want to buy a bit of Italy. Even the products don't have Italian names. One of its new totes is called the Hug bag. Its design is somewhat similar to Hermes's bags with the same emphasis on buckles.
The brand's new identity has scared away the traditional consumer who loved its elegant silk scarves and bow-tipped ballerinas. Today, the cohort of new followers are not big enough to compensate for departure of the old buyers. Ferragamo is struggling to rebuild traffic after having remained irrelevant from a fashion point of view for so many years, industry analysts say.
LOOKING BACK
For most of the past two decades, influential members of the Ferragamo family would not let go of the vision they had of the brand's golden age from half a century ago. In terms of style and image, they did not want it to stray too far away from that period. As a result, the brand looked old and customers thought it was for their grandmothers. Before the pandemic, the brand was dying a slow death and inertia was not an option.
Ferragamo needed a creative disruption, but it's turned out to be too radical and extreme for consumers to adopt and understand. "Davis is a great designer but I think he's not been briefed correctly, one former senior Gucci executive said.
Gobbetti was previously CEO of Burberry starting in 2017 and jumped ship after four years without completing the turnaround of the British brand for which he was hired.
Before Burberry, he spent 13 years at LVMH, running Givenchy with Ricardo Tisci as a designer, and later Celine with the acclaimed Phoebe Philo.
Gobbetti took Ferragamo's executive reins in January 2022 with a lucrative package. In 2022, his total remuneration reached €9.84 million, according to the company's annual report. That was three times more than what he made at Burberry. Plus, luckily for the 64-year-old Italian, who spent nearly 20 years abroad, he was entitled to the tax break reserved for Italians who return home. Starting in 2022 and for seven years, he became eligible to pay a flat 15 percent tax rate on his income - a third of what he was charged in the UK or what most wealthy Italians pay.
In 2023, Gobbetti received €8.2 million and was awarded shares last year and this year. That amount is more than the operating profit the Italian fashion company made in the first quarter of 2021.
Industry sources say one of the reasons why the Ferragamo family decided to renew his contract is because it would cost them too much to let him go. Gobbetti is said to have negotiated an excellent deal for himself. Several industry sources say he could claim at least two year's worth of salary if the family asked him to leave. Hence, best to keep him. Also, Ferragamo's revamp is only two years old. Might as well give Gobbetti more time to improve the brand's performance and his own track record
PATIENCE
Still, in recent months, patience among the Ferragamo clan has been running thin. Tension between Gobbetti and Leonardo Ferragamo, chairman of the board and son of founder Salvatore, have grown due to the brand's poor results, several senior industry sources have said. "Tensions between the Ferragamo family and Marco Gobbetti are super high," one of those sources said. So much so that the family forced out Gobbetti's trusted Chief Marketing Officer Catherine Vautrin last month. Vautrin was replaced by Michela Ratti, who was CMO of Ferragamo six years ago and worked for eBay, Swarovski and Procter & Gamble.
The company declined to confirm Ratti's appointment and did not reply to Miss Tweeds requests for comment. Ousting Vautrin is a sign the family is trying to take back some of the power it conferred Gobbetti when he took the executive reins.
"My understanding is that the family have lost faith in Gobbetti but they cannot let him go for now," one former Ferragamo senior manager who still has contacts with staff at the company told Miss Tweed under condition of anonymity. One of Ferragamo's problems is that more than 10 family members are still in key positions and continue to influence matters ranging from image to product and distribution - even though insiders suggest they are not all qualified for such tasks. "Many of them do not have the competencies to run a luxury company,' the former Ferragamo manager said.
When Gobbetti was hired by the Ferragamo family, he was regarded as the savior who could give the brand a new relevance. Before Gobbetti, the family would never let the CEO take decisions and craft a coherent roadmap. His predecessor Micaela Le Divelec Lemmi struggled to get the family's full backing and cooperation, industry sources said at the time.
Could it be that Gobbetti made the same mistake he did at Burberry - hiring a designer who did not really understand the brand? Designer Daniel Lee, in place for a year, is on a mission to reconnect Burberry with its British roots after years of lackluster performance under Ricardo Tisci. The Italian designer developed an metrosexual and sporty identity for Burberry that did not suit the brand, fashion critics and industry experts say. Gobbetti, who worked with Tisci before at Givenchy, was the one who chose the Italian designer for Burberry.
Whatever happens to Ferragamo, Gobbetti sitting pretty from a financial point of view. His concern now is his reputation and track record - things money can't always buy.
LadyJunon
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I don't really care about Gobbetti. He's 64 years old, so he can retire happily after this contract expires. I feel much worse for Maximallian Davis, who closed his own brand for the gig. I really hope that his contract doesn't have a non-compete clause so he can restart his brand ASAP.
^^ As an outsider, I can't imagine how much stress and pressure these CDs face on a day to day basis. Because unlike a CEO, the CDs need to constantly be creative 24/7 and come up with hundreds of new ideas for multiple collections a year, plus ad campaigns, store design, events, casting models, and on and on. It seems enough to break anyone.
PDFSD
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I think Davis will be able to restart his brand even if a non compete he will need the time to restart and build a team it's a win-win situation and further more he should have gained more experience and connections with suppliers and factories etc so it like a paid internship :-)
I would assume this year is the deadline for both of them if things don't change upwards, its not cohesive and again the story is not clear lots of these designers do the Phoebe design mix but forget to have something to say that is as cohesive as compelling and directional with real key products.
Design and changing stylist every season won't help either, would be cool if it did work out and be success but i doubt it so far.
yslforever
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They have not tried really hard though: the stores have not changed since the arrival of Davis, they immediately overpriced it and you can hardly find his creations in stores...
fenty
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What? Well if you can find someone new with the amount of talent he has and not just the fact that they can sell, gladly let me know!
it’s quite a tough one. Davis seems to be loved by the press and social media. Content and responses after the show is always positive. All the girlies are giving the collections "yasses" "ate" and "slays" even for me I like it too. But the clothes is way too forward for the brand and I never liked any of the imagery.
Olaffo
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Ferragamo’s problem is, as MissTweed points out, this awful family’s meddling. I cannot imagine that 10 people are interfering from most of the departments, that’s pure insanity. What this brand needs is a proper game plan for next 5-10 years and brutal execution: from fashion (still not sure whether Davis was the right choice) through image, stores, pricing etc. It’s all out there but before they will do a proper housekeeping I have little hope for that brand. Good for Gobbetti with this bloody tax break !
jeanclaude
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That CEO is insanely paid. The CD job is more stressful...and I doubt they pay as much money to Maximilian.
LadyJunon
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I imagine he's probably paid around 1-2 million a year, considering that he's very young. If it all goes to sh*t, I hope he thought to save up some money to be able to restart his brand with better resources (preferably in Milan, because London looks like an abyss for fashion).
style_expert
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Marco Gobbetti, better known as the most overrated and overpaid CEO of recent times.
Yes, the Ferragamo family meddling doesn't help but to be honest, he made many mistakes at Burberry too.
If only his skills in truly understanding a brand's DNA and positioning matched his talent for enriching himself...
Yes, the Ferragamo family meddling doesn't help but to be honest, he made many mistakes at Burberry too.
If only his skills in truly understanding a brand's DNA and positioning matched his talent for enriching himself...
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