MILAN — Golden Goose chief executive officer Silvio Campara has taken the proverbial bull by the horns, deciding to skip a season as the coronavirus spreads, Italy is in lockdown and stores are closed.
“Our strength lies in the fact that we made up our mind in advance, rather than let wild negotiations and emotions get in the way and disrupt the relations between the parts, the suppliers, the company and retailers,” said Campara, explaining that Golden Goose has three collections: pre-woman, main (what some call the runway show line and which accounts for 20 percent of sales) and men’s. Campara decided to skip the production of the brand’s main collection.
“If I had asked producers to manufacture it, I would have had to ask for discounts and the collection would have arrived late. This way, producers have not lost hours of work. Suppliers and our clients were touched, our decisions were appreciated, as I hear there’s a lot of arm-wrangling and moral persuasion going on and suppliers and clients are cornered. Everyone needs visibility and cash. By not shipping the last part of spring, we knew we would cut back our sales by around 30 million euros, or 10 million euros per month. Our seasonal orders total around 100 million euros.”
Wholesale accounts for 50 percent of sales. At the beginning of March, Golden Goose had a 70 percent sell-through, Campara said. He noted that the company closed 2019 with a 40 percent increase in sales to 272 million euros and a 40 percent increase in earnings before interest, taxes, depreciation and amortization, which reached 92 million euros.
In February, as reported, private equity fund Permira bought Golden Goose from Carlyle at a price that was pegged at 1.28 billion euros. Sneakers are the brand’s core business and account for around 80 percent of sales, but Golden Goose has been expanding its accessories and ready-to-wear.
“We are close to our clients and together we are stronger. It’s a sense of responsibility. It’s not enough to send out a newsletter, we call client by client, there are no solutions that please everyone. But this way, we have no delayed payments or canceled orders. I know how much I will lose and we won’t do discounts. It’s important for the brand to come out of it the right way when stores reopen. We throw away this season anyway, when we restart it will be with the spring 2021 collection. We work with heart because people will remember and the brand can become a best friend or an enemy through the actions put in place now; with head, to remember the lessons today for tomorrow, and with tactics to take decisions coolly.”
Discussing potential scenarios, post-COVID-19, Campara doubted the world would need so many fashion shows and so many people traveling. “Brands will stop thinking about collections, they will think in terms of drops. The concept of collections is old, thinking one year ahead of what the consumer will want a year later. And the response is not fast fashion. What’s the sense for retailers to invest 50 percent of cash at the beginning of the season instead of investing every month a correct amount of cash depending on each brand’s sell-through and ability to generate cash? It’s clear that retailers must review their cash approach and brands will have to adapt to it very quickly both in terms of creativity flow and production flow.”
Campara continued: “Will people want to spend thousands of dollars on designer sneakers? Or a few euros on a T-shirt that you throw away? We will abandon the concept of ownership for that of value. Campaigns will not be successful because they are strange or sexy but only if they communicate their value in the best possible way.”
Generation Z will be central, contended the executive, as “the world is going in that direction,” and, as with the fall of the Berlin Wall, or 9/11 or the Lehman Brothers collapse, “every 10 years there’s a new start.”
“Creativity top down will be over, everybody will want to be decisive in the creative process, and we are involving the customers in the creative process. The chief emotional officer will be important, understanding the customers’ emotions.”
Golden Goose is usually inspired by travel but the spring 2021 season will reflect the times and the brand will launch the Together We Are Stronger project. “We thought of a white page, so we took our key looks — a sweatshirt, a chino, a motorcycle jacket — which will be sold in white with colorful markers and customers will have the possibility to write on the piece a thought or a message from their time spent at home. Then it will be posted on Instagram and we will produce it. The collection will be available the end of May and we will sell it online,” Campara said.
In addition, proceeds from the #TogetherWeAreStronger T-shirts available on Goldengoose.com and the app Golden Passport will be entirely devolved to a number of hospitals fighting the coronavirus.