Jil Sander, The Comeback Kid

Three years after a messy split from Prada Group, Jil Sander is returning to design for the label that bears her name.

MILAN — Lightening does strike twice.

This story first appeared in the May 21, 2003 issue of WWD.  Subscribe Today.

In a stunning move many dreamed could happen but never believed would materialize, Jil Sander is returning to the label she founded 30 years ago and she’s doing so with her former nemesis: Prada chief Patrizio Bertelli.

While details were sparse, Prada and Hamburg-based Jil Sander released statements late Tuesday announcing that the designer is returning to take over the creative direction at the Prada-controlled company immediately. Prada did not say when her first collection would bow, but some in the market expect her to be back on the runways here during the women’s collections in October. Sander will also take on a new position as a member of Prada Holding NV’s strategic committee, which advises the Prada board of directors on the strategic direction of the group and its labels which, in addition to Prada and Miu Miu include Helmut Lang, Church’s, Genny and Azzedine Alaïa.

As for Sander’s current creative director, Milan Vukmirovic, Prada officials were mum on his future. Vukmirovic was traveling in New York and did not return telephone calls, but it appears he is on his way out given Sander’s return.

Some observers also speculated that the return of Sander to the house might make it easier for Prada to sell the company as it moves to further pay down its debt. A Prada spokesman on Tuesday reiterated its longstanding denial that the business was for sale.

“I deeply welcome this development, which is positive for both sides,” said Sander in a statement. “I’m looking forward to carrying on with my work to perfect the creative Jil Sander concept, which will guarantee the future success of Jil Sander AG, the company I founded.”

The announcement confirms a WWD report on April 18 that Sander was in talks with Prada about returning to the house that bears her name.

In what was fashion’s most acrimonious breakup in recent memory, Sander stepped down in 2000 as chairwoman and chief designer of the house she built just months after selling it to Prada. She and Bertelli, both known for their headstrong personalities, continually clashed over the creative direction and management of the brand until only Bertelli was left standing.

But the Prada chief appears to have left the past behind.

“I’m delighted that Jil has made this important decision,” Bertelli said in the statement. “I am sure that she will find in the company the motivation and the resources necessary to enable her to express her ideas and creativity.”

Neither Bertelli nor Sander was available for further comment Tuesday.

Since Sander’s lack of artistic autonomy was one of the driving factors fueling her departure, it’s only logical that Bertelli would have to compromise and demonstrate a willingness to relinquish power in order to lure her back. Above all, industry watchers say Bertelli has to be more flexible and loosen his tight grip on the label.

“If she’s come back, she has received some assurance that she is going to be left alone,” said one analyst.

Andrea Paladini, an analyst with Centrosim here, agreed. “She really would have had to reach a special agreement that gives her carte blanche freedom.”

For three years, speculation has swirled that Sander was mounting a comeback. Although Bertelli often downplayed the need of its namesake designer, lukewarm reviews and lackluster sales under creative director Milan Vukmirovic proved otherwise. “Bertelli has wanted to get her back for years,” said one source close to the situation.

Bertelli tapped Vukmirovic in late 2000 after his stints at Paris’ Colette and Gucci Group. Although Vukmirovic saw some limited success with his men’s collections at Jil Sander, his aesthetic never gelled with Sander’s precise yet subtle vision.

While Bertelli put on a brave face, Jil Sander’s balance sheets revealed a different reality. Sales didn’t plummet but widening losses put pressure on Bertelli’s investment. One analyst said Bertelli must have realized “that this business is not as mechanic as he thought…you do need the designer.”

Jil Sander’s consolidated net loss for the year ended Dec. 31, 2002, stretched to $30.6 million from $12.5 million in 2001, as the company noted higher fixed costs related to the opening of flagships in London and New York.

(Dollar figures have been converted from the euro at current exchange.)

Sales in 2002 fell to $161.7 million from $169.9 million the year before. But the company said they would have risen by 2.1 percent had exchange rates between the euro and other currencies been stable.

Back in April, Prada had to inject an unspecified amount of fresh cash into the money-losing label, marking the second capital increase Prada has funded since it bought the brand in 1999. Prada gave Jil Sander a $23.3 million shot in the arm back in 2001.

Bertelli said Sander’s return will help the company improve its performance. “I am sure that the company’s results will benefit from [her] decision,” he said.

Vukmirovic never gained Sander’s steadfast following among retailers and consumers. Jil Sander’s strength was not only crafting modern clothes but building one of the strongest, most loyal followings of any fashion label.

“I’ve always called Jil Sander consumers Jil Junkies,” said Janet Brown, owner of the eponymous boutique in Port Washington, N.Y. “It’s a most extraordinary return to the throne. It’s really the second coming…in fashion terms this is messianic.”

“Jil Sander consumers are smart and intelligent and they never lost confidence,” said Jeffrey Kalinsky of the Jeffrey boutiques in Atlanta and New York. “They kept buying because they really had no alternative, although much more reluctantly. This is the moment I’ve been praying for since the day she left.”

Jaqui Lividini, senior vice president of fashion merchandising and communication at Saks Fifth Avenue, thought the collection could only benefit from the brand and its creator being reunited. “The collection of Jil Sander was such the essence of the woman Jil Sander,” said Lividini. “When you have the designer who created it and designing it, you can’t have a better synergistic blend.”

Currently Saks still travels to Hamburg to buy the collection for its five Jil Sander shop-in-shops in the Beverly Hills, Bala Cynwyd, Dallas, Houston and Palm Beach stores. Citing company policy, a Saks spokesman would not specify if the amount of Jil Sander merchandise it bought each season had decreased or increased since the designer’s departure from her eponymous brand three years ago.

However, Lividini said the solid customer base that made the brand such an important vendor for department stores continues to be highly relevant, despite Sander’s success during the height of Nineties minimalism.

“The essence of Jil Sander is that it’s a luxury collection, that’s truly a feminine version of utilitarian [clothing],” said Lividini. “Jil always seemed to be investigating form and function with a softness to it.”

Robert Burke, vice president and fashion director at Bergdorf Goodman, said, “There is a customer who has longed for Jil Sander since she left. That customer felt that she had a personal relationship with Jil, whether she really knew her or not.” Burke noted that although Bergdorf’s current Sander business is strong and “fills a need for well-cut, beautiful suits,” its customer base is different from the collection’s original audience. “There was a Jil Sander mafia that has disbanded since she left the house,” he said. “They will be happy to come back to her.”

But now that Jil has returned, industry watchers are pondering just what she and Bertelli will do to make it work this time.

“Jil and Mr. Bertelli had three years of learning and have figured out their mistakes,” Brown said. “They are two of the most brilliant design merchandising minds with two of the greatest brands — they’re going to make it work.”

There are few clues as to just how much management at the house will change. In fact, one insider said she was puzzled on how management will shape up at the house with the designer back on board. She noted that one of the designer’s demands in the past was for Bertelli to fire Roberto Massardi. The longtime Prada executive has been active in the Jil Sander business for years and Prada doesn’t appear to be getting rid of him, as the company just recently appointed him general manager.

Carlo Pambianco, a Milan-based consultant, said he thought Jil Sander would need an ally — who either took on a top management position or owned a stake in the company — for her successful return.

“It would be incredibly difficult for her to return with the same limitations as before,” he said.

Now that Sander has returned, the next question is how much longer Prada will hold on to the business. Faced with mounting debts from its acquisition binge and stalled attempts at an initial public offering, some in the market speculate that Bertelli has come under pressure to sell off some labels. Some in the market say a Sander sale could now be easier.

At the end of 2002, Prada’s debt pile stood at $897.2 million. Last month, Prada sold 45 percent of English shoemaker Church’s to Equinox Management Co. SA for an undisclosed sum and the group is planning a real estate spin-off to generate more cash.

“They are stretched financially…he’s [Bertelli] taken on too many acquisitions,” said one analyst.

Pambianco also said a sale would make sense now.

“When Prada bought Jil Sander it was the right moment. It was a brilliant market and Prada sought to increase its presence in ready-to-wear. Now it seems the right moment for Bertelli to refocus on Prada,” he said. “In this difficult moment everyone is faced with limited resources and it would be right for him to bring her back and eventually sell the brand.”

One name that keeps popping up in speculation as a possible buyer is fellow German company Hugo Boss, which has struggled to launch a women’s business of its own. But the men’s wear giant has said it’s not interested.

“We are not willing to buy Jil Sander and we have no plan to do so,” the company’s spokesman reiterated Tuesday evening.

The other lingering question is whether Sander still has the touch that made so many fashionistas swoon. Although she’s been gone for three years — a virtual eternity in fashion time — most agree not only will she bounce back, but she’ll be better than before.

“For her, it will be a snap,” said Kal Ruttenstein, senior vice president and fashion director at Bloomingdale’s. “She’s a very determined woman with a single vision.”

Brown, like others, took an almost religious tone: “I feel born again. I am so happy not only for myself but for every Jil fan and there are thousands of them…It’s like when the Rolling Stones come back or Barbra [Streisand] played at Madison Square Garden.”

Linda Dresner, who operates eponymous boutiques in New York and Birmingham, Mich., was also optimistic. “It will be like she never left. I expect a swift return,” she said. “Designing is her forte — for her it’s like breathing — it’s that natural.”