It was the end of an era for Italy’s biggest fashion brand.
Alessandro Michele, Gucci’s creative director since 2015, is leaving the company. Gucci’s design studio will “continue to execute the direction of the House forward” until a new innovative configuration is announced, the Kering-owned brand said in a statement.
“There are times when the road turns because of the different perspectives each of us may have. Today, an extraordinary journey has ended for me, spanning over twenty years, in a company to which I have tirelessly devoted all my love and passion for creativity,” said Michele. .
Kering director François-Henri Pinault said: “The path that Gucci and Alessandro have walked together over the years is unique and will remain a defining moment in the brand’s history. “His passion, imagination, ingenuity and culture put Gucci at the center.”
After taking the creative reins of Gucci in 2015, Michele rekindled excitement around the Milan-based home, soon dominating the fashion world with its decadent stratification of brand signatures, selling streetwear-inspired and quirky, gender-flexible styles. A comprehensive reorganization of Gucci products, communications and store decor led by Michele and CEO Marco Bizzarri has attracted a large following of the brand and helped open up a new world. a new, younger consumer base for the luxury industry that caters to the tastes of more mature buyers.
From 2015 to 2019, Gucci’s sales nearly tripled and profits quadrupled during a period of rapid expansion, unheard of in modern luxury – at a quarterly rate of growth. sometimes up to 50%. This year, Gucci is expected to end the year with annual sales of over 10 billion euros ($10.3 billion), a major milestone for the company.
But Gucci has been hit hard during the coronavirus pandemic — with sales down 22% in 2020 — and has since grown much more slowly than major brand rivals like Louis Vuitton, Dior. and Hermès, whose sales boom as consumers are rocked by uncertainty. to blue-chip luxuries that are considered unfashionable.
The slower growth momentum at Gucci is partly due to greater exposure to struggling channels including wholesale, discount and travel retail, which have a share of the business the company has been working to capture. narrow.
But there are also signs of consumer fatigue as the novelty element of Michele’s twisted, maximal aesthetic is gone. During a February meeting with journalists, Kering president François-Henri Pinault said he wanted the company’s brands to refocus their efforts on a more timeless approach to luxury.
In recent seasons, Michele’s designs for Gucci have included more subtle, uplifting details: less streetwear and more knitwear or embroidery, and classic handbags using Use one or two key brand cues like ponytail and red and blue stripes instead of layering them with decorative elements like painted flowers, butterfly charms, or cartoon characters. Gucci has hired a new sales director to revamp its merchandising offering, as well as announcing a complete return to the fashion calendar with six collections per year to foster innovation and novelty.
The evolution of Gucci’s collections, however, has struggled to capture the attention of consumers, perhaps drowned out by the designer’s hilarious, wildly consistent message, still is underpinned by unsurpassed runway style (headwear and eyewear necklaces) and a vibrant, Old Hollywood red carpet atmosphere.
Sales fell short of estimates in the third quarter, up 9% from 22% growth at LVMH, owner of Vuitton, and 24% growth at Hermès.
Analysts and investors are concerned that Gucci’s recent changes won’t be enough to accelerate growth at par with its peers.
Bernstein analyst Luca Solca wrote in a note to clients: “Gucci is suffering from brand fatigue. “To get up to speed again, Gucci doesn’t need to go mainstream or become timeless. It needs to open a new creative chapter.”
Michele has also suggested that he could use the break as the brand looks to speed up its creative cadence. “Work is becoming more and more stressful for me,” he told reporters after his show at Milan Fashion Week in September. “This fatigue is something else. . Behind-the-scenes work [this season] more tired than usual, he added.
Shares rose 2% in early trading on Wednesday following a Women’s Wear Daily report citing unnamed sources that Michele’s departure from the brand was imminent.
Additional reporting by Lauren Sherman.