The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
This week, Estée Lauder announced its $2.8 billion acquisition of the Tom Ford brand, whose lucrative beauty line had become so significant to the cosmetics and fragrance giant that it had no choice but to buy the business — or risk losing its licensing deal — when Ford went to market earlier this year.
But the star designer’s days at his namesake brand appear to be numbered. According to a line in the statement announcing the deal, Ford “will continue to serve as the brand’s creative visionary after closing and through the end of calendar 2023.”
So, what happens after that?
Representatives for Estée Lauder and Tom Ford declined to comment further on the matter. But it’s entirely possible that Ford will step away at the end of next year. The designer, who is currently based in Los Angeles, has been open with friends and colleagues about wanting a change, according to sources who have spoken to him directly. Whether that means he’ll relocate, direct another film or explore a different creative medium remains to be seen. He wouldn’t be the first designer to grow tired of fashion.
But one thing is certain. Much of the brand’s success was grounded in the fact that Ford retained the rights to his name — which he licensed to Zegna, as well as Estée Lauder — and exercised firm control over all elements of creative output, from the glossy cream veneer of the brand’s original lipstick receptacles to the ultra-specificity of its scents to the Guy Bourdin-inspired advertising.
Consider the case of Fucking Fabulous, a fragrance he launched along with a runway collection at an event supported by Lauder in September 2017 at New York’s Park Avenue Armory, where shirtless men passed out drinks bathed in purple light. “First of all, [Estée Lauder] didn’t even want to launch it,” Ford told BoF a year later. “I kept calling it Fucking Fabulous and I’d get it back with an asterisk. I was like, ‘No no, we’re going to spell it out on the bottle. They had such a hard time understanding that.” But Ford persisted and a projected $400,000 in first-year sales turned into $25 million, making the fragrance a certified hit.
The good news for Estée Lauder is that the framework Ford established is remarkably strong. Still, Tom Ford is the sexiest brand in its portfolio and maintaining that perception without the designer won’t be easy. Lauder has also lost John Demsey, the longtime beauty executive responsible for bringing Ford and other fashion brands, including Balmain, into the Lauder fold, who was terminated earlier this year after publishing racially offensive posts on his personal Instagram. (In September, the group promoted Guillaume Jesel, a longtime Demsey deputy, to run both Tom Ford and Balmain and further develop the luxury category.)
For the Ermenegildo Zegna Group, which now owns the rights to produce and sell all Tom Ford fashion — including womenswear, a category currently designed out of a Los Angeles studio and produced by the brand — it’ll be a challenge to build out the category in such a competitive market. But there are some quick wins to be had.
Tom Ford is still the first name in men’s suiting for the red-carpet, with through-the-roof name recognition. Even as the suit continues its transition from everyday necessity to nice-to-have fashion, Zegna has an opportunity to lead in special occasion wear and dress shirts. Ford’s longtime deputy Peter Hawkings, who has led the menswear design team from London for many years, is a clear successor; Hawkings has worked alongside Ford for long enough to continue without him.
When it comes to Tom Ford womenswear — a small business that never hit with the same impact as Ford’s work for Gucci and Saint Laurent and has been squeezed in recent years — Zegna will need to wade slowly and carefully, but the category clearly offers a lot of potential upside.
And yet, however they proceed, both Estée Lauder and Zegna would benefit from keeping Ford close, perhaps as a creative consultant. Here, the case of Thierry Mugler offers something of a template. Long after he stopped designing ready-to-wear, the late French designer continued to animate the Mugler brand — whose Angel fragrance remains a global powerhouse — working on museum exhibitions and VIP dressing projects.
In recent years, Mugler’s fashion collections have also flourished, thanks to designer Casey Cadwallader, who has managed to create ultra-modern, attention-grabbing clothes that pay just the right degree of homage to the founder. So many younger designers, from Theophilio to Bally creative director Rhuigi Villaseñor, are inspired by Mr Ford‘s work that if Zegna were to hire a new creative director to oversee the fashion offering, it wouldn’t be short of talent options.
Ford saying goodbye for good, however, could complicate things for the companies that have invested in the future of his brand. What made the Tom Ford label great was Mr Ford’s unwavering commitment to doing things his way. Can they find leadership with a similar sensibility — and the will to see their vision through?
THE NEWS IN BRIEF
FASHION, BUSINESS AND THE ECONOMY
New Burberry CEO Jonathan Akeroyd laid out his strategy for the brand’s next chapter. Together with designer Daniel Lee, Akeroyd plans to accelerate Burberry’s sales by boosting accessories and leaning into the brand’s British identity, growing annual revenues to £4 billion ($4.75 billion) mid-term.
Farfetch reports rare drop in online sales. Farfetch reported its first year-on-year drop in sales as a public company Thursday, with gross merchandise value falling nearly 5 percent to $967 million in the third quarter. Revenue rose under 2 percent to $593 million, falling slightly below analysts’ consensus forecast.
Gap beats quarterly estimates on steady demand for formal clothing. Gap Inc beat Wall Street estimates for quarterly sales and profit on Thursday, helped by steady demand from affluent consumers for its formal clothing and dresses despite a surge in inflation, sending its shares up about 10 percent in extended trading.
Adidas seeks cash from rare bond after Yeezy split, new CEO. The German sportswear brand is seeking €1 billion ($1 billion) from its debt sale on Monday, according to a person familiar with the matter, reports Bloomberg. It’s the firm’s first dive into the public debt market since 2020 and before that it hadn’t issued bonds since 2014.
Macy’s profits from wealthy shoppers, Kohl’s feels inflation pinch. Luxury goods sales have held up for Macy’s as affluent shoppers splurge on pricier items and gifts heading into the holiday season. But Kohl’s withdrew its annual forecasts, as the company, which caters more to lower-income customers and stocks fewer luxury goods, reeled from weakening demand due to rising prices.
Streetwear enters Formula 1 with Palm Angels collaboration. The collaboration will encompass the creation of images, events and also products and the brand will function as “EntArtainment Curator” for the Haas team as part of an ongoing partnership, a Palm Angels spokesperson said. The team-up will launch in early 2023 at the beginning of next year’s season.
PETA launches $1 million ‘vegan wool’ prize. PETA will award $1 million to the first individual or small business to successfully develop a sophisticated animal-free alternative to wool, the animal rights group announced Thursday.
Patagonia, Reformation back toughened New York Fashion Act. The proposed legislation, which faced criticism after being proposed last January, aims to make big brands accountable for environmental impact and working conditions in their supply chain.
Louis Vuitton’s Paris HQ could become LVMH’s next hotel-megastore complex. Louis Vuitton’s new exhibition space on the Seine River, as well as parts of the brand’s adjoining headquarters on Rue du Pont Neuf could eventually be transformed into a flagship store and hotel, WWD reported Tuesday citing comments by CEO Michael Burke.
Luxury’s growth expected to slow dramatically next year, Bain says. After sales of personal luxury goods were set to surge 22 percent this year, the consultancy forecasts growth will slow to 3 to 8 percent in 2023.
LVMH’s Delphine Arnault appointed to the board of Gagosian Gallery. The board, which includes Snapchat’s Evan Spiegel and filmmaker Sofia Coppola, is intended to “raise the bar on the gallery’s strategic thinking and vision for the future,” founder Larry Gagosian said in a statement. Gagosian has firmly denied rumours that the gallery is planning a sale to LVMH.
Nike loses third diversity chief in two years. Jarvis Sam had been with the company since 2018 but spent just five months in the role before his exit. In June, he replaced Felicia Mayo, who served as Nike’s chief talent, diversity and culture officer for just two years.
Rolex appoints Nicolas Brunschwig as chairman in quiet change of guard. Brunschwig was appointed to the chairman role of Rolex SA and Rolex Holding SA in August, succeeding Bertrand Gros, the company said Thursday, confirming a corporate registry filing. The move was earlier reported by Swiss newspaper Handelszeitung.
MEDIA AND TECHNOLOGY
Balenciaga has left Twitter. The Kering-owned brand deleted its account, where it had 950,000 followers, on Monday. Following Elon Musk’s acquisition, advertisers have raised concerns about the risks of loosening content moderation on the site.
Nike launches its first big web3 project. Nike’s .Swoosh is a platform for customers to learn about web3, collect virtual products like sneakers or jerseys and, eventually, help to co-create them — even potentially earning royalties on their sales.
Adidas sees virtual items as its next big product category. The German brand revealed its first collection of NFT wearables for virtual spaces just days after Nike announced the debut of its web3 platform.
Amazon plans to lay off 10,000 people starting this week. The job cuts will focus on the e-commerce giant’s devices unit, which houses voice-assistant Alexa, as well as its retail division and human resources, according to the report, which also said the total number of layoffs remains fluid.
Compiled by Joan Kennedy.