MILAN — “Luxury is a means through which people realize their dreams, and for this it will endure.”
As the industry wrestles with the consequences of the COVID-19 pandemic, there is hope in the words of Salvatore Ferragamo’s chief executive officer Micaela le Divelec Lemmi, reflected by other entrepreneurs and executives of brands that are part of the first Milan Digital Fashion Week, organized by the Camera della Moda and slated to run July 14 to 17, presenting their spring 2021 men’s lineup and/or men’s and women’s pre-collections, respecting defined time slots. Within each one-hour slot, the participating labels will be free to showcase their preferred formats. In light of the coronavirus, the spring 2021 men’s shows and presentations planned for June 19 to 23 did not take place and will be incorporated into Milan Fashion Week women’s, which is expected to start on Sept. 22 and end on Sept. 28.
Etro will hold a physical coed runway show to present its men’s spring 2021 and women’s resort 2021 collections on July 15 at Milan’s Four Seasons Hotel, digitally amplified “to strengthen the message of encouragement and strong positivity both the fashion system and the city of Milan need,” said the company’s general manager Francesco Freschi. “I believe the institutions have done a great job in wanting to create a dedicated moment to present the new collections, despite the difficulties.”
The brand will respect the safety measures and regulations, said Freschi, describing the event as an “intimate meeting for a few guests with Kean and Veronica [Etro, creative directors of the men’s and women’s collections, respectively] at the Four Seasons because we strongly believe that fashion, even though it cannot disregard the digital channel to reach as much public as possible, must continue to be fueled by real experiences and social interactions” — an issue that has emerged over the past London and Paris digital fashion weeks.
Carlo Capasa, president of the Camera della Moda, said the organization would like Milan’s digital fashion week to be “a dynamic solution to the complexity of the present, a functional and creative tool designed to stand alone or to support the physical fashion calendar when we will be able to resume physical events, which remain essential to promote Made in Italy.”
As the pandemic continues to hit the Americas and several other countries around the world and fear of a return of the health emergency in the fall casts gloomy shadows on the future, an increased focus on digital platforms is par for the course for all companies, and has proven to be a lifeline over the past few months.
Le Divelec Lemmi for one enthused about the channel, as Ferragamo in February developed a business solution with digital content company Hyphen to create a digital virtual showroom for the brand, launched a new web site in the spring, and will show a video during MDFW “about the fundamental values of the brand, which is now more than ever relevant to do, on the traction between craftsmanship, heritage and innovation and creativity.” The company in July introduced the Augmented Store 360, a virtual tour of its boutiques, compatible with AR devices, and which allows consumers to buy online and visit the Ferragamo Museum in Florence, including an interactive tour led by personal guides. “I like to think of this as augmented humanity, as the human component, one-to-one relations remain a must,” said le Divelec Lemmi.
While exposure to China and to tourism weighed on the company’s bottom line in the first quarter of the year, as reported — dragging revenues down 30.1 percent in the period to 222 million euros — the executive said Asia was back to an “almost pre-COVID-19 performance, Korea never stopped and we see interesting signals from China.” The company, publicly listed in Milan, is due to report first-half sales on July 28.
Massimo Ferretti, executive chairman of Aeffe, which controls the Alberta Ferretti, Moschino, Philosophy di Lorenzo Serafini and Pollini brands — and whose revenues were also impacted by the coronavirus in the first quarter, falling 25.4 percent to 76.2 million euros — was pleased with the “very positive response” to the company’s virtual sales campaign. “From the reopening of the La Scala to some physical shows, there is a desire to return to normality, and now is the time to stimulate consumer spending, and we must not tone down our efforts and communication, on the contrary,” said Ferretti, praising the Camera della Moda’s initiative to stage MDFW “to communicate with the outside and feel close to one another.”
In fact, his sister, designer Alberta Ferretti, during MDFW will present a film that is “a tribute to Italy, its beauty and its art cities that represent the country around the world.” Philosophy di Lorenzo Serafini will present its pre-collection with a video fronted by model Luna Bijl and filmed in the province of Brescia, Italy. “Lorenzo wanted to show beauty in one of the areas hardest hit by the pandemic,” explained Ferretti.
For Moschino, Jeremy Scott will present a video look book of his pre-collection for men’s wear as “a tribute to his fans, with a message of optimism and a desire to return to normality,” said Ferretti.
But it’s a normality that in financial terms appears to be hard to reach. Earlier this month, the European Commission estimated an 11.2 percent drop in Italy’s gross domestic product this year, compared to a 9.5 percent fall forecast in the spring. This compares with an 8.7 percent decrease in the euro zone. For 2021, GDP is expected to rise 6.1 percent in Italy.
Sistema Moda Italia, with the support of the Centro Studi of association Confindustria Moda, earlier this month reported that in the March to April period, textile and apparel consumption was down 69.3 percent, while the first four months of the year decreased 33.7 percent in value. Online sales, on the other hand, were up 10 percent in the March to April period.
Marino Vago, president of SMI, said the study highlighted how Italian entrepreneurs are “creating all the possible conditions to fulfill orders, with the goal to keep the pipeline alive in all its parts.” But the figures are a source of “great concern” about the Italian industrial system, which in great part is made up of small and medium-sized companies.
The country’s National Institute for Statistics, ISTAT, last week reported a 42.1 percent increase in Italy’s industrial production in May compared with April, up from expectations of a 20 to 25 percent growth. In particular, the textile industry’s production rose 142.5 percent in May compared with the previous month.
In fact, Roberta Benaglia, ceo of MSGM and founding partner and ceo of Style Capital, which has a stake in the brand designed by Massimo Giorgetti, said “at least, the industrial machine has restarted, allowing to recover ground lost during the lockdown, and the fall/winter collection will be delivered. We have the advantage of having local showrooms in a world that was very globalized before the pandemic and we have returned to local sales campaigns,” she said.
MSGM was not heavily impacted by the financial turmoil, as Benaglia expects a 10 percent decrease in sales in the year, which is “a good figure all in all.” So much so that, since the company is healthy and cash-rich, she said she “could imagine M&A operations for MSGM, too, small brands perhaps, but there is nothing concrete yet.” The consolidation of the children’s line, previously a license and now managed directly through a joint venture, will bear fruit in the second half.
Asked about possible M&A scenarios in general, Benaglia sees two situations. “For those companies with a liquidity problem, necessarily there will be a need for capital increases, so I see more turnaround and restructuring deals. Paradoxically, I think it will be more difficult to see M&A action involving healthy companies, because if there is no urgency for capital, entrepreneurs would want to see how the situation evolves and not sell at a discount. For this reason, I don’t believe there will be an acceleration of M&As, but rather a slowdown of leverage buyouts by the end of the year.”
In this scenario, entrepreneurs are finding ways to continue to build business. Gianni Castiglioni, ceo of Plan C, is also banking on the digital platform, unveiling the brand’s first online store in November as he reported “positive signs” from the sales campaign. “The product is well liked, orders are being placed, a number of Italian clients surprisingly physically came to our showroom,” said Castiglioni, whose daughter Carolina designs the collection. Like other brands, Plan C reduced the amount of product by about 20 percent, focusing on “more essentials.”
“By its nature, Plan C is in line with the trend today of producing two seasons, less and understated product, with many carryovers,” said Castiglioni. The online store will allow the brand to be fully represented with a complete offer, he underscored. “We are still young and we are cautious, but this is an opportunity to really showcase our range of product.”
The executive said the fall collection will be physically delivered in Japan at the end of July, transiting via Korea, for its sales campaign. “Japan and Korea are very important for Plan C, they represent around 40 percent of total sales,” he said. Despite the fact that the line was launched only two years ago, there are already four Plan C stores in Japan. Castiglioni was confident in the market’s reactivity in the region.
The brand’s capsule Go Sporty will be rolled out starting in Japan in August in pop-up stores and at the Tokyo flagship, and then globally with the launch of e-commerce. The collection of T-shirts, sweatshirts, canvas shoppers, small leather goods, notebooks, brooches, and a water bottle line of 24 bottles was meant to celebrate the Tokyo Olympics starting in June, before the pandemic forced the postponement of the event. Carolina Castiglioni asked artist GGT to redesign the brand’s characters Pili and Bianca (originally conceived by her daughter) interpreting sports in a playful way, with hand-drawn characters engaging in different sport activities, from tennis and soccer to surf, baseball and skateboard.
