Just as designers were readying themselves to present at New York Fashion in their usual splendor in February, the industry was shaken by the sudden departure of Sabato De Sarno from Gucci after only two years as creative director.
And just a few weeks later, husband and wife duo Luke and Lucie Meier bid adieu to their roles as creative directors at Jil Sander on the heels of Milan Fashion Week.
The news echoed a string of similar C-suite exits that have marred the industry, underlining the bigger economic and political challenges that luxury retailers, among many others, continue to face. The case can be made more markedly for the likes of retailers like Gucci or Burberry—that also saw an abrupt CEO change last year—as both brands have seen sales dwindle over the past year.
“The last couple of years, we’re seeing the market become significantly more competitive. In the next two to three years, all of our research is showing that the market is going to be declining in some categories, but very slow growth overall,” Nora Kleinewillinghoefer, partner and Americas lead for fashion and luxury at Kearney, told Retail Brew. “It takes a very different type of leader to succeed in most of the brands.”
With several economic factors at play, Kleinewillinghoefer added, fashion has seen a perspective shift from wanting to rely on heritage leadership to a more “quantitative business-focused” one. At Burberry, for instance, Joshua Schulman—who previously served as chief executive of Jimmy Choo and president at Bergdorf Goodman—seemingly came to his current post of CEO for precisely that reason as consumer demand slowed.
Deborah Weinswig, CEO at Coresight Research, said that the introduction of new tech in fashion has always been a key reason for high-level changes at these companies.
“If we go back and look over time, when you have major shifts in either technology or how some of these companies are looking at their companies holistically, you start to see some of these major changes, because the person who’s the existing CEO, it’s very difficult for them to move at the speed that needs to happen in order for the organization to catch up with the market,” Weinswig told Retail Brew. “So I think there’s a recognition by the leadership team themselves that they’re not ready for what’s around the corner.”
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Meanwhile, on the creative director side, motivations are slightly more varied; a constant thirst for newness, for instance, that has dictated some decisions like the appointment of Pharell Williams at Louis Vuitton, which surprised many insiders but seems to have worked to an extent in its favor.
“I do think the Pharrell Williams idea, where you bring somebody that is completely outside of the industry, not an industry veteran, somebody who’s doing something different that brings a very different consumer set to the brand and a new audience,” Kleinewillinghoefer said. “Are they going to be successful? The jury’s out, but I think they are interesting and bold and differentiating to signal a distinct change in the brand.”
Citing the example of designer and longtime Chanel creative director Karl Lagerfeld, Kleinewillinghoefer explained that brands might be past the era of sticking to “the greats” or legacy names as they retire or pass away like Lagerfeld. “I think right now, brands are trying to find who that new identity for them is,” she said. “I do think there’s been a little bit too much reliance on the heritage. So the consumer is looking for something more innovative, and the creative director is a natural place to make that shift.”
Still, whether the new vision that brands have acquired can work long term is not clear yet, but retailers need to think carefully before making a big change as they set a path for the future.
“I don’t think the repeated changing is advisable,” Kleinewillinghoefer said. “Some of the changes like…bringing a bold new direction—that really sets a tone for the brand, that’s very critical right now. It’s signaling that you’re evolving….you’re meeting the consumer [and] that you understand how the market has shifted and that you’re not just relying on the past.”