From the grave to the podium: the rise of Versace.
Versace isn’t just Versace. It’s the house of the “young divo,” as founder Gianni Versace called himself.
Versace's designs were loved by the rich and famous on a scale that no other fashion label had ever experienced. His ability to develop a unique vision of glamor, combined with a savvy business sense, made him one of the few designers who succeeded in becoming a household name nearly single-handedly.
Whatever his designs might have lacked in modesty, they gained tenfold in theatricality. Celebrities like Madonna and Lady Diana, were drawn to his creations because of their opulence, extravagance, and eccentricity.
Versace was not afraid of shock value. This became most apparent when he designed dresses for Elizabeth Hurley's character in the 1994 film “Four Weddings and a Funeral”. The scene with Hurley introducing herself to Hugh Grant with the famous line "I'm so sorry, I almost forgot my Versace" still manages to evoke laughter among viewers.
Liz Hurley wearing the iconic Versace Safety Pin Dress
Gianni Versace had built the Versace name into an international phenomenon, and as such it marked a different kind of brand identity.
It wasn’t just a clothing company, it was a lifestyle brand.
However, once Gianni was murdered in 1997 and Donatella took over the company, the downfall of the brand was inevitable; sales plummeted from $1 billion to less than half (Thomas, 2009). Probably this was caused by many erratic business and creative decisions, such as:
· The death of the Divo was not handled properly: After Gianni’s death, the appeal of Versace went down 90% and the mismanagement of this event strongly damaged the image of the brand. (Freeman, 2004)
· Getting rid of the best ones: Donatella fired legendary fashion photographer Richard Avedon (Thomas, 2009). Moreover, the company culture became hostile and various CEOs left the company because of that.
· Ruined brand image: Donatella plunged into drug addiction and given that she was also the creative director, this was immediately associated with the deteriorating brand. (Thomas, 2009)
· Versace lost his creative voice: The creative shift alienated retailers and consumers. Donatella’s creative decisions made longtime Versace customers turn to Gucci and other brands. (Freeman, 2004)
· Wrong brand ambassador choices: In 2002 the company decided to sign with Christina Aguilera, but the campaign became one of the most disastrous campaigns of Versace. (Susman, 2003)
· Resistance to change: Due to internal resistance from the family members to change, the managers failed in delivering good strategic decisions. (Thomas, 2009)
Despite everything, Versace didn’t turn into a dying star but it went really close to it. Instead, it became a Waning Star, because among the bad business decisions, no disastrous extension was made.
But how did the brand shine again?
Experienced economists, marketers and managers helped Versace cope with the difficulties. After a reorganization of the company in 2010, where about 25% of employees were laid off (Bumpus, 2010), the company's assets gained new strength and began to develop again. A few years later, for instance, the brand launched the Versus youth line, and also presented a haute couture collection.
In 2018, Michael Kors Holdings Limited acquired the Versace fashion house for $ 2.1 billion (Sherman, 2018). Following the transaction, the newly merged company became Capri Holdings Limited, which now continues to increase its momentum and remains one of the most famous and sought-after design empires.
Jonathan Akeroyd (chief executive of Versace SpA), Donatella Versace and John Idol (CEO, Capri Holdings)
Nowadays, the Versace label lives on and still holds on to its true roots, with the legendary Donatella Versace as the artistic director of the brand.
In the first post-pandemic fashion show that took place in Milan, Donatella staged it together with the popular singer Dua Lipa, who has undoubtedly attracted almost everyone’s attention and you just could NOT resist talking about it!
Versace has also collaborated with Fendi for a joint show which was co-designed by Donatella V. and Fendi’s creative directors Kim Jones and Silvia Venturini Fendi - how powerful is that?
MFW21, “Fendsace” collection presentation
Moreover, the brand has introduced the dubbed Greca print, which is designed to rival the famous monograms of the competitors like: Louis Vuitton and Gucci. Plus, the brand has been endorsed by Gen Z thanks to Bella Hadid, who is the star of Versace’s campaign for the brand’s new Virtus handbag.
Versace New Pattern -” Dubbed Greca”
With the new unique signature pattern, “the brand plans to pump money into a major marketing campaign around the style” (Bloomberg, 2021). What is left to us, is to patiently wait and see how Versace will astonish us!
Sources:
Kaur, S. (2021, March 22). Is Versace a Luxury Brand? Luxury Viewer. https://luxuryviewer.com/is-versace-a-luxury-brand/
Versace at the Venice International Film Awards 2021. (2021). Versace. https://www.versace.com/international/en/world-of-versace/stories/news-projects/
Cartner-Morley, J. (2021, September 25). Dua Lipa brings showbiz glamour to Versace show on her catwalk debut. The Guardian. https://www.theguardian.com/fashion/2021/sep/24/something-special-rumours-in-milan-over-versace-x-fendi-tie-up
Cornu, C. (2017, July 14). The Versace story: After its founder’s murder, how the luxury brand rediscovered its soul. The Local Italy.
Girod, S. J. G. (2018, October 12). Versace acquisition: Michael Kors needed to boost its credibility to make it in the luxury market. IMD Business School. https://www.imd.org/research-knowledge/articles/Versace-acquisition-Michael-Kors-needed-to-boost-its-credibility-to-make-it-in-the-luxury-market/
Bhasin, K. (2021, February 3). Versace Bets Future on New Signature Pattern to Revive Brand. Bloomberg.
Freeman, H. (2004, October 04). The Guardian. Retrieved from Plunging sales match the necklines as Versace struggles to regain its touch: https://www.theguardian.com/world/2004/oct/04/fashion.italy
Susman, G. (2003, March 05). Versace signs Christina Aguilera. Retrieved from Entertainment Weekly: https://ew.com/article/2003/03/05/versace-signs-christina-aguilera/
Thomas, D. (2009, May 11). The Tragic Decline of the House of Versace. Retrieved from NewsWeek: https://www.newsweek.com/tragic-decline-house-versace-76845
Bumpus, J. (2010, January 29). Versace decisions. British Vogue. Retrieved from https://www.vogue.co.uk/article/versace-restructure-approved
Sherman, C. C. and L. (2018, September 25). Game on: Michael Kors acquires Versace for $2.1 billion. The Business of Fashion. Retrieved from https://www.businessoffashion.com/articles/luxury/game-on-michael-kors-acquires-versace-for-2-billion
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