“Thirty-five years ago, I had no idea I’d still be coming into the office every day, but here I am,” said Paul Marciano as he strode into the main building of the 340,000-square-foot Guess campus in downtown Los Angeles.
This story first appeared in the February 8, 2017 issue of WWD. Subscribe Today.
With his signature look — now silver hair, dark jeans, navy blazer, black T-shirt and white sneakers — Marciano, 64, still has a youthful air about him, and takes obvious pride in the $2.2 billion fashion empire he and his brothers Maurice, Georges and Armand founded in 1981. In classic Marciano style, Guess also is still celebrating its 35th anniversary well into 2017. (The end of 2016 was a busy one for Marciano, who wed his longtime love Mareva Georges in Bora Bora over Thanksgiving weekend.)
“My brothers and I used to have stores in France [the family’s clothing company MGA operated stores along the French Riviera], but when we came to Los Angeles on vacation in 1977, we fell in love. We thought we’d try to open stores here too, and we would’ve been happy with a $7 million to $9 million business.”
Instead, Guess skyrocketed into a $700 million business in its first 10 years, due in no small part to the designer denim craze of the Eighties and Guess’ first jean style — the famous tapered, stone-washed, ankle-zip Marilyn, which sold out at Bloomingdale’s within hours of its first delivery.
It’s that style that Claudia Schiffer donned in her iconic Guess 1989 Guess campaign, and which Hailey Baldwin now wears in the brand’s anniversary capsule, the aptly named Guess Originals 1981.
Marciano is now the only brother involved in day-to-day operations of the company (Maurice took on the role of director and chairman emeritus in 2012, and Georges and Armand left after well-publicized feuds in the Nineties and early Aughts. Paul and Maurice still talk business every day, and dine together four nights a week).
Paul, who has always been the driving force behind the brand’s ad imagery, calls the introduction of the black-and-white ads in 1988 “a big turning point for us, with a very sexy image.” After all, in the days before the Internet, magazine ads and billboards were the primary sources of fashion inspiration for women who shopped at malls and department stores. One model and one image could result in millions of dollars in sales.
“If you tell me pick one model of the 35 years, without thinking I would pick Claudia Schiffer, who was that crucial, that pivotal, who basically established our brand around the world,” he said.
Indeed, Schiffer’s black-lace, bustier-clad image takes up the entire wall in the red “Claudia” conference room, one of several named after Guess girls.
In the Nineties, it was Maurice who spearheaded international retail expansion with partner companies, going beyond the company’s 80 North American stores by opening the Southeast Asian countries of Singapore, Malaysia, Indonesia, the Philippines, Taiwan and Thailand. The Middle East, South Africa and Mexico followed. Guess is now sold in 92 countries.
“I think we were ahead of a lot of companies because we were not American, so we weren’t afraid to open different countries. For us, it was normal,” said Marciano, who called Japan his “most challenging” market to this day.
The dawn of the Aughts saw a focus on company-owned stores, though Guess continues to work with distributors, franchisees and licensees. “In late 1999, Maurice decided to get out of department stores and go retail-vertical because he believed that was the future and he was absolutely right,” said Marciano. “At the time, we had around 250 to 300 stores and between 2000 and 2013, we went up to 1,650 stores.” He said the company took a beating from Wall Street analysts, but called the move “exactly the best thing to do to survive the change and migration of customers going to vertical stores rather than department stores.”
He’s quick to note the current climate and the changes that are all the more dramatic and require nimble and ever-changing adaptations to the business model. He pointed to the strength of Guess’ accessories business — which makes up 40 percent of store sales (80 percent of the overall accessories business comes from handbags, watches and footwear and the company has licenses for belts, eyewear and fragrance as well).
“When we started to open stores everywhere, there was an incredible run-up in handbags and we became the aspirational handbag between $90 and $150. And that put us on the map in a different scale, especially in Europe, the Middle East, Australia and South Africa. That was one of the biggest growth businesses we have and continue to have today.”
That’s not to say there haven’t been missteps along the way. Some capsule collections have bombed; a mass-market concept called Gasoline failed to rev retail engines; an early Japanese licensing deal went south and shut the company out of the market for a decade, and a few executives in Europe turned out not to share the same brand values as the Marcianos. “That’s a mistake that also takes time to fix,” he said. “But making mistakes is normal, it’s expected — [but] if you don’t take risks, you don’t make mistakes. If you want to play safe, you are going to stay put and never move forward.”
But as it goes with milestone anniversaries and heritage companies, it’s looking to the past that often provides product inspiration. It was Marciano’s son Nicolai, 20, who now works for the company, who started going through the archives that inspired the Originals 1981 collection. By chance, Nicolai met designer darling rapper A$AP Rocky, who went on to collaborate on an Originals capsule with the company last year.
“I have not seen people waiting in line in front of our stores for many years. They are waiting in Tokyo at 5 a.m., in London, in Seoul, Madrid, Barcelona and Beverly Hills. They were all waiting for the A$AP Rocky collection. That was amazing to me because it’s a new generation who did not know what Guess was in 1991.”
That vintage vibe has led the design direction of Guess for the last year and a half. And it’s thanks to his Millennial kids Nicolai and Ella, 22, (his children with Mareva Georges are Ryan, 11 and Gia, four) that Marciano has a window into the minds of today’s young shoppers. Certainly he’s social-media savvy when it comes to choosing Guess girls Gigi Hadid and Hailey Baldwin, although Hadid, a family friend, has been appearing in Baby Guess and Guess Kids ads since she was two years old.
“I don’t even know the last time my kids went into a shopping center. And Ella was the first to make me realize that the new generation doesn’t have that much loyalty about anything. They change their minds so fast, they have zero focus on loyalty — except if it’s a pair of shoes that are very comfortable, and a handbag that will be special. Because the availability of so much product makes almost everything less interesting, they want to be different. So they buy vintage pieces. So we go back to square one and create things that people have not seen for the last 25 years. We come full circle,” he summed.
He stressed the need to make “hard choices” about what parts of the company to grow and shutter, saying, “You have to reorganize and decide what is the right thing to keep the business profitable and expanding. You have to adapt, manage and really focus on what is important, but that’s what it takes if we want to be here 10 years from now, 20 or 30 years from now. That’s the job.”
He views the American market as a harbinger of the retail climate around the world. “America, don’t forget, was 40 years ahead of everyone in shopping malls. So what you are seeing here most likely will happen in Europe, but they don’t have this oversaturation of retail footprint that we have in America. It’s too much, of everything. So a cleansing will happen. It will be painful for a lot of people but there is no other way.”
And Marciano is also open to growing the company by acquiring other emerging brands. When Guess acquired — and later sold — its stake in French contemporary brand Iro a few years ago, he got the yen to do more.
“We are looking at maybe even creating and acquiring some small brands that will fit under the same vision. Maybe beach, maybe handbags, maybe more selective and limited,” he said. “We’re looking at many things now, which will be public in the next few months.”
Reflecting on his 35, going on 36, years in California, he said, “Our roots are Los Angeles more than anything else. For me, it’s a city of dreams, movies, glamour, images that stay in your mind. It’s like ‘La La Land.’”
For those who think less of dreamers like him, he said, “You cannot be everything for everybody. I always say, ‘I respect your opinion, but respect mine.’ We are who we are.”