Luxury Grapples With Turmoil as New Creative Directors Take the Helm

The luxury goods market is currently navigating an unprecedented period of turbulence, grappling with a confluence of economic slowdowns, escalating geopolitical tensions, and pervasive market volatility. Further exacerbated by the imposition of 15% tariffs on exports to the United States, this challenging economic climate has significantly impacted the sector. The strain is evident in the recent half-year financial results of numerous luxury houses, painting a picture of an industry entering autumn with profound uncertainty. Amidst a summer marked by a flurry of leadership announcements and executive shakeups, many brands are now placing their bets on a fresh wave of creative directors to reignite growth and redefine their identities.

According to a comprehensive report by Bain & Company, presented in collaboration with the Italian high-end goods association Altagamma in June, the luxury goods market is experiencing its most significant deceleration in 15 years, excluding the anomaly of the COVID-19 pandemic. The first six months of 2024 revealed a mixed bag of results among major luxury players, with several former industry champions reporting steep declines. LVMH, a titan in the sector, saw its net profit fall by 22% to €5.7 billion, alongside a 4% decline in revenue to €39.8 billion. Adding to the sector's woes, Loro Piana, a brand within the LVMH portfolio, was placed under court administration by the Milan court in July following reprimands for outsourcing to subcontractors with poor working conditions, further tarnishing the luxury industry's image.

Kering, still contending with the ongoing decline of its flagship brand Gucci, reported a substantial 46% drop in net profit to €474 million, accompanied by a 16% decrease in sales to €7.6 billion. Lanvin Group also faced significant headwinds, with sales declining by 22% to €133 million and gross profit falling by 26.8% to €71.9 million. Salvatore Ferragamo experienced a 9.4% drop in sales to €474 million, recording a net loss of €57 million, while the Zegna Group reported a 3.4% decrease in sales to €927.7 million. Moncler's revenue remained relatively stable at €1.2 billion (+1% at constant currency), but its net income saw a 15% dip to €153.5 million.

Amidst these widespread challenges, some luxury houses managed to defy the downturn, demonstrating resilience and growth. Hermès led this group with a 7.1% increase in sales to €8 billion, though its net income slipped by 5% to €2.2 billion. Prada achieved impressive 9% growth, reaching €2.74 billion in sales, with a net income of €386 million, marginally up from €383 million the previous year. Brunello Cucinelli reported a robust 10.7% growth in revenue (at constant exchange rates) to €684 million and a 16% rise in net profit to €76.7 million. Similarly, Spanish group Puig posted strong results, with €2.299 billion in revenue, marking a 7.6% increase on a comparable basis (+5.9% reported).

In response to these uneven performances, the luxury industry has entered a comprehensive leadership reshuffle phase. Kering spearheaded the most prominent changes, appointing automotive executive Luca de Meo as its new CEO, effective September 15th, with a crucial mandate to revitalize Gucci and restore growth across François-Henri Pinault’s group. Within Kering, Cédric Charbit transitioned to lead Saint Laurent, while Gianfranco Gianangeli took over his previous role at Balenciaga, supported by incoming Deputy CEO Nathalie Raynaud. Federico Arrigoni was named CEO of Brioni, succeeding Mehdi Benabadji.

LVMH has also been active in realigning its executive structure. Michael Burke has been appointed President and CEO of LVMH Americas, while Pierre-Emmanuel Angeloglou assumed the role of CEO of Dior. Damien Bertrand was named Deputy CEO of Louis Vuitton. Jean-Christophe Babin, previously head of Bulgari, now leads LVMH's watch division. Frédéric Arnault took the reins at Loro Piana, Ramon Ros was appointed to manage Fendi, and Charlotte Coupé now oversees Kenzo. The luxury conglomerate also initiated structural changes, with Ludovic Pauchard leading the new industrial and craftsmanship division and serving as Executive Chairman of Métiers d’Art. Strategy Director Jean-Baptiste Voisin will oversee the "brand, retail & strategy" division and supervise the LVMH Média Recherche Image teams, while Stéphanie Medioni is set to become Chief Brand Officer in 2026, succeeding Mathilde Delhoume.

Beyond the major groups, other significant executive movements include Riccardo Bellini replacing Jacopo Venturini as General Manager of Valentino, and Sam Lobban taking over as CEO of Thom Browne from Rodrigo Bazan. At Lacoste, Eric Vallat stepped in for Thierry Guibert. Nicolas Topiol, CEO of Christian Lacroix, departed in July, handing control to brand owner Sociedad Textil Lonia (STL), and Serge Brunschwig left Jil Sander (OTB) after a brief six-month tenure, having previously served as CEO of Fendi.

Parallel to these executive transitions, the luxury world is undergoing a dramatic creative overhaul, with new artistic directors assuming pivotal roles at major fashion houses. This fresh wave of talent is anticipated to take center stage during the upcoming fashion weeks, poised to set the tone for the industry's next creative chapter. At Milan Fashion Week, significant attention will be on Gucci, where Demna (Gvasalia) is slated to present his inaugural collection on Tuesday, September 23rd. The following day, Simone Bellotti will make his debut at Jil Sander. Versace's new designer, Dario Vitale, is expected to offer early glimpses at a closed-door event on September 26th, and Louise Trotter will unveil her first collection for Bottega Veneta on Saturday, September 27th.

Paris Fashion Week is set to host an impressive nine major debuts. Key highlights include Jonathan Anderson’s first women’s collection for Christian Dior on October 1st, and Matthieu Blazy’s highly anticipated debut at Chanel on October 6th. Other notable newcomers include Mark Howard Thomas at Carven, Michael Rider at Celine (who previewed his pre-collection in July), Lazaro Hernandez and Jack McCollough at Loewe, Duran Lantink at Jean Paul Gaultier, Glenn Martens at Maison Margiela (following a couture debut in July), Miguel Castro Freitas at Mugler, and Pier Paolo Piccioli at Balenciaga. Looking further ahead, the next round of creative shifts is already in motion, with Proenza Schouler tapping Rachel Scott from Diotima, and Marni naming Belgian designer Meryll Rogge, winner of the Andam Grand Prix, as its new artistic director after the departure of Francesco Risso.