On Thursday, a report in the trade publication Glossy posited that Off-White founder Virgil Abloh was in talks to be the next creative director of Versace, succeeding Donatella Versace, sister of the house’s late founding designer, Gianni Versace.
A representative for Abloh told BoF that there is “no truth” to the speculation. Versace also vehemently denied the news, telling BoF: “This is categorically untrue.”
Of course, this just the latest rumour to surface regarding Versace’s succession plans. The speculation comes on the heels of failed discussions between the Italian fashion house and longtime Givenchy creative director Riccardo Tisci, who was thought to be the prime choice for the job. More recently, those rumoured to be in the running have included Balmain creative director Olivier Rousteing, as well as Louis Vuitton menswear head Kim Jones.
Versace has been seeking a creative director as Versace gears up for significant expansion ahead of a still-planned, albeit significantly delayed, initial public offering.
In June 2016, Alexander McQueen veteran Jonathan Akeroyd was named chief executive of Versace, replacing Gian Giacomo Ferraris, who departed for Roberto Cavalli after consolidating the Versace business into four collections: Atelier Versace, a couture-like line; the men's and women's ready-to-wear lines; the contemporary line Versus; and Versace Jeans, a licensed casual-wear line.
In January of this year, Akeroyd announced that it would no longer spend the marketing dollars to show Atelier Versace on the official calendar at Paris Couture Week, instead allocating those funds to “major client events” around the world. "At the moment, we do six shows a year, and my feeling is: that's a lot of shows. Eight, if you count couture, seems excessive," he told The New York Times. "And we all know the model is changing quite a lot, so why not take the opportunity to try something new?"
In 2016, Versace's sales hit €669 million (about $796 million at current exchange), a four percent increase from €645 million ($768 million) in 2015, according to the Italian newspaper Radiocor-Il Sole 24 Ore. In 2015, sales were up nearly 9 percent year over year.
Many believe the performance does not reflect the brand's true potential. “Versace’s brand awareness across the world is far higher than the actual sales of the company," said Mario Ortelli, a senior luxury goods analyst at Sanford C. Bernstein. "There is big untapped potential which can be converted into sales, boosting brand image through memorable marketing campaigns, introduction of iconic and desirable new products, and the opening of new stores. Therefore, the company can be an interesting acquisition target."
Versace’s brand awareness is far higher than the actual sales... There is big untapped potential.
Akeroyd not only has the Versace family to contend with, but also a significant external investor. In February 2014, the company — which has intermittently been rumoured to be pursuing an IPO — received a roughly $290 million cash injection from private equity firm Blackstone Group in return for a 20 percent stake in the family-controlled business. (Upon the death of Gianni Versace in 1997, his niece Allegra — daughter of Donatella — inherited a 50 percent stake.)
Of course, a private equity stakeholder expects a return on its investment, either via a public flotation or a sale to bigger firm.
While it seems that the house is still in the process of selecting a successor, one thing is for certain: Donatella Versace has a track record of spotting — and collaborating with — new talent, including Christopher Kane, Jonathan Anderson and Anthony Vaccarello. Each of these designers has since gone on to partner with a major luxury conglomerate. Kane and Vaccarello (at Saint Laurent) now work for Kering; Anderson works for LVMH’s Spanish leather goods house Loewe. Now, Versace must bring a designer into the fold that sticks with her.
Updated 11:40am GMT on 1 September 2017: A representative for Versace has denied that Donatella Versace is being pressured by executives and financial backers to name a successor, adding that the designer maintains a strong relationship with private equity investor Blackstone Group.
Editor's Note: This article was revised on 1st September 2017. A previous version of this article mistakenly attributed Versace’s deceleration in 2016 to the tenure of Jonathan Akeroyd. Akeroyd was only at the brand for five months of the 2016 financial year and therefore cannot be held responsible for Versace's financial performance over the entire course of the year.