Ford, 42, who refused to be interviewed for this story, has yet to announce his future plans. Rumors have him doing everything from taking over at Versace to becoming a Hollywood film producer. But the story of his career at Gucci is an illuminating one for the luxury-fashion industry. Indeed, his tenure paralleled a decadelong boom for luxury couture, which now does $100 billion in sales a year. Yet his departure shows that in today’s conglomerate-heavy market, being one of the world’s most successful designers is no guarantee of a job. As luxury companies grow bigger and bigger, the role of the couturier keeps shrinking. The message: you can be replaced.
That’s tough love in a business that has always embodied the utmost politesse. But that’s what luxury has become: a fiercely competitive, profit-driven global industry of publicly traded corporations that care more about shareholder demands than the ever-fickle fashion set. Since the mid-1980s, tycoons such as Francois Pinault, Patrizio Bertelli of Prada and Bernard Arnault of LVMH have been buying up luxury’s most famous names and reinvigorating them, turning small family-run businesses into multinational brands with $1 billion–or more–in annual sales.
Along the way, the luxury titans have switched the focus of luxury fashion from the designer to the brand. This allows the bosses to change designers regularly without disrupting the image of the house. Celine, for example, is looking for a replacement for Michael Kors; Bill Blass is on its third designer in four years; Lanvin is on its fourth in a decade, and Givenchy is about to hire its fourth womenswear designer in eight years. “It is such a competitive marketplace that if you take your eye off the ball for a moment, you’re out,” says Rita Clifton, U.K. chairman of Interbrand, a global-brand consultant in London. “The brand is the most sustainable and important corporate asset.”
It wasn’t always like this. Luxury fashion as we know it was created in the late-19th century by Charles Frederick Worth, an England-born, Paris-based couturier who shifted dressmaking from a made-to-order business to one that provided seasonal collections. By the 1920s, designers such as Coco Chanel and leather artisans like Guccio Gucci had opened their own businesses; as the founders died, the houses either closed or were taken over by heirs.
That began to change after Christian Dior dropped dead of a heart attack in 1957. His brand was so strong that the owners appointed his 21-year-old assistant, Yves Saint Laurent, to succeed him. As a protege, Saint Laurent maintained Dior’s line. But his tenure came abruptly to an end when he was called to military service–and when he returned to fashion in 1962, it was to open his own house.
So it went for a few decades: young designers–such as Oscar de la Renta, Issey Miyake and Emmanuel Ungaro–apprenticed at the grand couture houses, then launched their own labels, which became big luxury brands. In 1984 Arnault bought Dior, followed by Louis Vuitton, Givenchy, Kenzo and Celine, and began to build the first luxury megagroup. His method: take an old, classic brand, hire a young, unknown designer and relaunch to a hip new–and richer–customer. Soon CEOs throughout the luxury-fashion business were following this model. It provided a great break for young designers, especially those from New York’s dog-eat-dog garment district, like Kors and Marc Jacobs.
But at what cost? Many gave up the dream of having their own labels. Others sold their brands to the groups and lost control of their names. The repercussions are still being felt; today it’s much harder for new names to launch their own lines. Why should investors take the risk when the biggest brands have not only cornered the market but also swiped all the talent? The luxury-fashion business is now primarily composed of a set number of household brands, very few of which are designed–or even owned–by the name on the label. “From the consumer’s perspective… it’s the product that counts,” says Dana Telsey, luxury analyst for Bear, Stearns in New York. “Designers who can have a following are a rare breed.”
The biggest cost is creative. Today, when new talents are hired to reinvigorate classic brands, they are bound to the house’s signature look. Karl Lagerfeld, for one, is still reinterpreting the 1920s Chanel suit. As Lagerfeld has said, his relationship with Alain Wertheimer, the owner and CEO of Chanel, is “like between the Devil and Faust.” Rather than let the designer shape the brand, today’s executives want the label to shape the designers. “It’s difficult for a brand to find the right designer because the designer has to have, in his own creativity, the creativity of the brand,” Arnault says. Until they do, the revolving door keeps spinning.
Ford helped cultivate this strategy and then fell victim to it. When he arrived at Gucci in 1990 as womenswear designer, he was fresh off Seventh Avenue. The company had been driven to near bankruptcy by the founders’ heirs, the logo so overlicensed you could find bins of Gucci makeup bags in discount stores. Ford’s mandate was to restore some sparkle to the label.
On his first day he designed the bamboo-handled knapsack, and it quickly became his first megaseller. In 1994 he took over as creative director. When he presented his first Gucci collection in March 1995, he shattered the label’s staid, aristocratic image and established a more modern and sexy voice: low-slung pants, sheer blouses, slinky shifts and killer heels. Ford’s look lured a new, young, big-spending customer. Sales figures nearly doubled every year. Smaller houses and mass-retail chains like the Gap followed Ford’s lead. Gucci’s then owner, the Bahrain-based bank Investcorp, floated Gucci on the stock market, making it one of the most successful IPOs in fashion ever. By the late 1990s, Gucci was the hottest name in luxury fashion. But, as at the other major houses–Burberry, Louis Vuitton and Givenchy–the average customer had no idea who designed its clothes.
In March 1999, after a hostile takeover bid by Arnault, Pinault bought a majority stake in Gucci and helped establish a new luxury conglomerate called Gucci Group, with Gucci and Yves Saint Laurent Rive Gauche as its cornerstones. Ford was soon designing both, and then he and De Sole used their Gucci model to turn Rive Gauche into a brand. They applied the same formula to Balenciaga, Bottega Veneta and the jeweler Boucheron.
Ford and De Sole ultimately left Gucci because they wanted to continue running the company independently. Now PPR plans to fold it into the conglomerate, making it even more corporate and less designer-driven. Who will fill Ford’s loafers? The odds are on Stefano Pilati, Ford’s No. 2 at Rive Gauche womenswear, to take over there, while Bottega Veneta’s creative director Tomas Maier is a leading candidate for Gucci. Though Ford eventually found the spotlight–attending Oscar parties and appearing on talk shows and magazine covers–from PPR’s point of view he was merely an employee. In today’s luxury market, it’s the brands that are the true stars.
