With changes in CEOs at LVMH and the Prada group, the recent changing of the guard in fashion can be seen as a survival mechanism as recession looms.
BY RYAN WADDOUPS
January 12, 2023
Raf Simons shocked the industry when he announced in late November that he plans to close his eponymous label after 27 years. The Belgian designer, who launched his brand in 1995 before enjoying stints at Jil Sander, Dior and Calvin Klein, has proven to be a vitalizing force in menswear, consistently crafting youth-focused collections distilling underground influences into minimalist silhouettes that have achieved cult following. status. Some have speculated that Simons made the move in anticipation of taking creative control of Italian giant Prada, which named him co-creative director alongside Miuccia Prada in early 2020. But despite stepping down as CEO of the Prada Group in December, the longtime designer insists she’s not retiring anytime soon.
The surprise move capped a dynamic year of musical chairs for the industry, which continues to face a whirlwind of departures and appointments. Alessandro Michele has left Gucci after eight years. Riccardo Tisci left Burberry after less than a year and was replaced by Daniel Lee, whose last tenure at Bottega Veneta included deleting social media and launching an online magazine. Marco Gobbetti, CEO of Salvatore Ferragamo, has announced a comprehensive rebrand and appointed Maximilian Davis as Creative Director. (The 27-year-old dropped out of the LVMH Prize for Young Designers to take the job.) On the acquisition side, Tom Ford sold his brand to Estée Lauder for $2.8 billion, the biggest luxury deal of the year. Director changes at Chanel, McQueen and Versace also made waves.
According to a recent study, half of the creative directors at approximately 40 houses have been in their positions for five years or less. “Compared to other product-based industries, such as automobiles or furniture, there is almost a fad of change in fashion. And when you change the art director, you change the whole team, most of the time,” Marco Pecorari, assistant professor of fashion studies at Parsons Paris, told WWD, comparing cyclical shifts to “brief interventions” rather than profound change. Applying a new creative director’s sensibilities to ready-to-wear, leather goods, accessories and perfume is nearly impossible in a short term, but brands also face pressure to work at an accelerated pace thanks to social media.
Benjamin Simmenauer, a professor at the Institut Français de la Mode in Paris, says that money speaks volumes. “After the first contract, if the goals are not met and above all, if there is no significant growth, the creative team generally changes,” he said, noting that brands look more favorably on long-term cooperation. “[Brands] they look for consistency and seem increasingly risk-averse as they strive to reach larger audiences.”
But the shakeup with the greatest potential to impact the industry comes from none other than LVMH. The French luxury conglomerate recently appointed new CEOs at its two largest houses in one of the group’s biggest executive shakeups in recent memory. Pietro Beccari, CEO of Christian Dior Couture, will succeed Michael Burke as CEO of Louis Vuitton. Taking over Baccari’s reins at Dior is Surface cover star Delphine Arnault—eldest child of LVMH CEO Bernard—who is currently Louis Vuitton’s executive vice president of product and manages the closely watched LVMH Prize. With the appointment of Bernard’s son, Antoine, as CEO of the financial holding company through which the family owns a controlling stake in LVMH, each of his children has a major role in the group.
Nepo baby accusations aside, why now? A recession is on the horizon, and the brands that fueled the e-commerce boom during the pandemic are making sure the right person is in charge. (This isn’t limited to fashion — nearly 700 U.S. CEOs left their positions in the first half of 2022.) Executives who steered brands through the upheaval of the pandemic may not be as well equipped to tackle today’s tricky climate of congested supply chains and track records. inflation, although both are declining. Entrepreneurs face murky waters as investors shift priorities to prospects with better margins, which are increasingly difficult to achieve as the digital environment evolves. To prevent brands from suffering a similar fate to Sies Marjan and Zac Posen, who closed their labels amid turbulent financial markets, fresh blood may be needed.