Donatella Versace inherited the fashion house through tragedy, but soon found her footing and maintained the house’s relevance for over a decade. If anyone can bring this house back to profitability during this downturn, it is Donatella Versace.
Versace has not been immune to the economic recession; the company announced last week that it would reduce it’s workforce by 26 percent. Losses are projected in the near future, but the house is expected to return to profitability in 2011.
When you consider how Donatella was thrusted into a position that, as she says, she never wanted, and thrived, it would be premature to count her out right now. If she takes this setback as an opportunity to regain the house’s dominance, Versace can emerge from this downturn virtually unscathed.
Unlike most fashion houses, this one is extremely personal to the designer. It was founded by her late brother, Gianni Versace, and her daughter now holds a 50 percent share in the company. There is every incentive to bring this company back to its pre-recessionary days.
Ms. Versace has managed to maintain the prestige of the Versace label. Known for its overtly sexy designs, it’s difficult to imagine her customer base abandoning her for long. Combining the house’s ability to maintain the quality for which it’s known with affordable pricing may be its biggest test.
The company’s greatest asset may be the designer herself; she is Versace, and she’s resilient. The label is often glorified in rap songs, and sought after by the young and fabulous. Even through this downturn, the name still maintains its luster, and if Donatella Versace has her way, it will stay that way.
Restructuring Luxury at Versace [NYT/Style]