Two years after Sabato de Sarno was appointed to take the creative reins at a flagging Gucci, his efforts to revive consumer demand for the Italian megabrand have run out of road.
The company announced his departure Thursday, just days before owner Kering is set to report its annual results. Gucci, Kering’s biggest and most profitable brand, has been in a sustained slump, with revenue down 26 percent year-on-year in the third quarter.
De Sarno’s exit is effective immediately: his designs won’t feature on the runway during Milan Fashion Week later this month. Instead the collection on display during Gucci’s Feb. 25 womenswear show will be designed by the design studio, the brand said in a statement.
What’s behind De Sarno’s departure?
Though sudden, De Sarno’s departure was no surprise.
The Neapolitan designer was appointed to restore a more stable, classic feel to Gucci’s aesthetic; an antidote to the radical, maximalist aesthetic of his predecessor, Alessandro Michele, which (in tandem with a commercial strategy that leaned heavily into more accessibly-priced streetwear and accessories) drove huge sales — until it didn’t.
But amid a broader post-pandemic slowdown in luxury demand, De Sarno’s more restrained approach failed to generate anywhere near the buzz created by Michele (or Tom Ford, who presided over the brand’s previous boom), and Gucci’s sales fell further behind peers.
“The writing was on the wall,” said Bernstein analyst Luca Solca. “The demure style of Sabato De Sarno didn’t fit the exuberant image that consumers have built of Gucci in the past 30 years.”
The issues weren’t with design alone. Logistical shortcomings and supply-chain lags meant De Sarno’s designs trickled into stores, giving customers that might have wanted to purchase them limited access. Kering deputy CEO Francesca Belletini told BoF in September that the first real wave of deliveries that would test customer appetite for the new collections was only just hitting stores. And yet De Sarno’s vision, when it did finally hit, failed to ignite sales.
The designer’s exit comes amid a broader shakeup in Gucci’s top ranks. Luxury veteran Stefano Cantino was named CEO in October, and lost little time in shaking up the brand’s marketing and communications team. More of that kind of swift, decisive action may be what Gucci needs.
Who could take over Gucci’s creative helm?
The pace of luxury’s designer musical chairs is particularly frenetic at present, leaving the brand spoiled for choice.
Hedi Slimane left LVMH-owned Celine in October and would be a top choice for Gucci. The star designer is regarded as an exceptional talent, with an edgy but classic point of view that packs commercial punch. During his tenure, annual sales at Celine more than doubled to €2.5 billion ($2.6 billion), according to analyst estimates (LVMH does not break out performance by brand). He previously helped Kering transform Saint Laurent into a billion-dollar business, though his 2016 split with the company turned into a messy divorce, and how well his French aesthetic would work for Italian Gucci is an open question.
Kim Jones, who left Dior Homme last week, would be another interesting pick. Jones has always wanted to design men’s and women’s under one label and Gucci would give him that opportunity. He designed Fendi’s womenswear for four years, but his work there underscored his relative lack of experience as a women’s designer, a crucial segment for Gucci.
Dior’s women’s designer Maria Grazia Chiuri might also make sense should she exit the brand this spring and return to Italy as some sources predict. During her tenure at Dior, sales quadrupled, but whether she could boost Gucci’s fashion quotient is uncertain.
Jonathan Anderson could be a fresh choice if Gucci is looking for a designer who defines the zeitgeist and has proven his ability to breathe new life into a brand. Anderson turned Loewe into a multi-billion-dollar business, where he has gained extensive leather goods experience. But the designer may be headed to Dior, according to sources, and the fact that his JW Anderson label is tied to LVMH makes it unlikely he would leave the group.
This time around, Gucci is far less likely to take a chance on a relatively untested creative director. The once-unknown Michele fuelled explosive growth for the brand. But De Sarno, a behind-the-scenes designer at Valentino before he joined Gucci, has not — and it’s highly improbable that management would take a risk like that again.
What’s at stake for Gucci?
Without exaggerating: everything. And not just for Gucci. The brand accounts for roughly half of Kering’s revenue and two-thirds of operating profit, dictating the fortunes of one of luxury’s largest players.
“Gucci is more than ever central to Kering’s equity story,” said Citi analyst Thomas Chauvet. The brand’s underperformance has dragged on the group’s share price and valuation for the last five years, he noted.
Shareholders reacted positively to the news of De Sarno’s exit. Kering’s shares rose 3 percent in Thursday trading. But the luxury group will need to show rapid progress both creatively and operationally to start to restore investor confidence in its long-awaited Gucci turnaround.
“I don’t expect Kering’s results to give much of a reason to celebrate next week, as the Gucci revival remains work in progress,” said Solca. “Hopefully Kering will announce a big name to replace De Sarno. But with the fashion show pending, I wonder.”
