Changing Creative Direction in Fashion Houses

By Erinna Ma

This year has seen a generous number of designer shake-ups at several of our favorite fashion brands. Demna Gvasalia replaced Alexander Wang at Balenciaga! Meanwhile, Anthony Vaccarello brought his masculin-féminin style to Saint Laurent with the departure of Hedi Slimane. And what are we to make of the rumors about Sarah Burton leaving Alexander McQueen for Dior, or of Phoebe Philo leaving Céline?

Changing the creative helm of a design house marks the end of an era and an anticipation for an even bolder one. When done right, it is the perfect boost for a stagnant brand looking to drive its business forward. Céline achieved this success under Phoebe Philo, who transformed the dormant brand and drove upwards €750 million in sales for LVMH.

Some influential designers are powerful enough to bring their back-of-house troupe and clientele along with them when they join new fashion houses. Such a designer is Hedi Slimane, the creative director of Yves Saint Laurent in 2012 who was the subject of controversy when he decided to drop “Yves” from the brand’s name. Not only did he bring his fans over from Dior to Saint Laurent, Slimane infused a sexier and edgier take into his predecessor Stefano Pilati’s romantic vision and doubled the brand’s revenue in three years.

A full-fledged fan base is not always characteristic of new hires. An example of a lesser-known figure making a whirlwind change to a design house is Alessandro Michele, who reinvigorated Gucci with his idiosyncratic vintage style as its creative director in 2015. Michele increased sales by 13% in his fourth quarter and has become a fashion celebrity in his own right.

However, changes to creative directors at major brands comes with significant capital expenditure and risk. Companies pay creative directors millions of dollars and, once on board, are challenged with accommodating their new director as well as his or her team. For instance, Dior reorganized the entire operating model of its studio to suit Raf Simons and his right-hand man, Pieter Mulier, when Simons signed on in 2012. Meanwhile, both Slimane and Philo enjoyed the luxury of having design studios established near their places of residence when they started at Saint Laurent and Céline, respectively.

Updating retail stores to match the designer’s creative vision can be costly as well. At Gucci, revamping 512 of its stores for Michele was estimated to cost between €650 million and €850 million. There is also the tricky trade-off between renovating the stores all at once and potentially hurting profitability versus delaying renovations for too long and causing stores to feel outdated.

Companies that choose to clear out old inventory in favor of a clean canvas for their new creative directors may have to wait longer before they can realize a return on investment. Although Saint Laurent’s revenues grew over 20 percent each year from 2012 to 2014 under Slimane, sales did not consistently outperform the overall luxury goods market until a year and a half into the designer’s tenure.

Designers who end their terms early pose another risk to companies. Most designers leave their design houses in fewer than 10 seasons, but higher chances of creative and commercial success seem to be correlated with designers who stay onboard for longer, as was done by Tomas Maier (15 years at Bottega Veneta) and Riccardo Tisci (11 years at Givenchy). Perhaps a more continual relationship between design house and creative director would help a partnership’s true value be achieved.

Nevertheless, good partnerships will continue to be a valuable asset to any fashion house, including the timeless brands whose names transcend the directors at their creative helm.

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