PARIS — Will the taint of bigotry cling forever to John Galliano — an albatross around his neck? Or will the incendiary British designer rehabilitate himself and his name over time, only to rise again like some fashion phoenix?

This story first appeared in the April 19, 2011 issue of WWD. Subscribe Today.

Retailers, headhunters and other experts seem to be rallying for the latter scenario, arguing that Galliano — ousted from Dior last month amidst mounting allegations of racist and anti-Semitic outbursts — has the potential to write himself a new chapter and rebound from the crisis.

“I hope so. Otherwise, it would be such a waste,” said Carla Sozzani, owner of Milan-based fashion retailer Corso Como 10. “Maybe I’m a dreamer, but I’m hoping he’s going back to his own brand. It would make sense that he works for Galliano.”

That scenario is unlikely: As reported, at a recent board meeting of the John Galliano company, his employment was officially terminated. And while Christian Dior SA, which owns 91 percent of the Galliano house, has received unsolicited expressions of interest in the business from several of its Italian licensing partners as well as a Chinese group and a firm from the Middle East, it is understood a sale of the company is not a priority and no banks have been contracted to do so.

Whether an eventual new owner would seek to reemploy the namesake designer remains an unanswered question.

Despite this hurdle, many industry observers are of the school that people in fashion have short memories — and that Galliano might find this tragic episode quickly behind him.

“Look at Naomi Campbell. She had so many problems. No one remembers,” Sozzani said, recalling how the supermodel, convicted of assault in 2007 and sentenced to community service, transformed the penalty into a quirky fashion opportunity, posing for W magazine as a chic street sweeper serving out her sentence.

“After a while memories fade and, as the British say, ‘Today’s news is tomorrow’s fish-and-chip paper.’ I really believe most people do get a second chance and rebound,” agreed Sarah Rutson, fashion director at Hong Kong-based specialty retailer Lane Crawford, characterizing Galliano’s fashion career as simply on pause. “If John truly gets the help he needs for his issues and shows that he is genuinely doing everything in his power to rehabilitate himself, he will be forgiven and accepted back.”

“I think he’s talented enough to recover from this and to come back,” added Agnès Barret, principal of Paris-based creative search firm Agent Secret. “Kate Moss did it,” she noted, alluding to the supermodel who was initially shunned following a 2005 cocaine scandal — only to come roaring back a year later and appear in a slew of high-profile ad campaigns.

“When people are really talented, they have the right to express themselves. His talent will not disappear,” Barret said. “I would advise him to do it in a different way.”

Bonnie Brooks, president and chief executive officer of Canadian department store The Bay, cautioned that it could take a long time to restore the Galliano name.

“We believe in his genius; however, we do think that in order for his brand to be successful, there would need to be assurance that all of the right conditions would be met to restore the good faith required between a designer brand, a luxury retailer and sophisticated customers,” she said.

Betsey Pearce, a Paris-based legal adviser and consultant with a specialty in fashion, noted that Martha Stewart and Tiger Woods are relevant examples of famous, high-functioning personalities who rebounded from scandal, an investment scheme and marital infidelity, respectively. “Would Tiger Woods be terrible if he weren’t married?” she asked. “Is it relevant to his golf, other than the effect of being vilified?”

Pearce hinted that plenty of designers are guilty of behavior that would be deemed reprehensible if caught on tape. “Are we buying the guy’s morality, or the guy’s incredible talent?” she asked. “He’s a genius in his work.”

With unanimity, observers stressed that Galliano should not be absolved of individual responsibility for his behavior and his horrendous statements cannot be swept under the carpet. Druggy or diva behavior is one thing; invoking Adolph Hitler quite another.

Asked if Galliano would be able to come back if he made amends, Franca Sozzani, editor in chief of Vogue Italia, said: “It’s not a matter of making amends, because what happened will never be excused. You must let time go by and recognize that, on a human level, he’s made a mistake, and that, on a creative level, he remains a huge personality.”

Robert Burke, president and ceo of Robert Burke Associates, noted that the anti-Semitic nature of Galliano’s outbursts is “pretty unprecedented” and distinct from the familiar wild-child antics of pampered stars from fashion or Hollywood.

“America loves a comeback story, but this is a very different offense that’s very sensitive to many people,” Burke said. “Time will tell.”

The designer is to stand trial on a charge of public insult at the High Court here, which is expected on May 12 to set the date for the proceedings. Three people — Géraldine Bloch, Philippe Virgiti and an anonymous woman — allege Galliano hurled racist and anti-Semitic remarks at them in a Paris bar. He could face six months imprisonment and a fine of 22,500 euros, or $31,271 at current exchange, according to the French prosecutor.

Galliano has denied the allegations against him, apologized for his behavior and stated plans to pursue a claim of defamation, insult and menace filed against Bloch and Virgiti. Sources said the designer recently completed an “intensive” one-month treatment at a rehabilitation center in Arizona and is now in extended “after care,” recognizing effective treatment is a long, ongoing process.

Barret suggested the designer must repent further, make amends with the Jewish community, and prove that his ability to dazzle and innovate is intact.

Crisis management experts agree penance is a key first step.

“He needs to spend at least three months quietly rehabilitating in a clinic,” said Gene Grabowski, senior vice president of Washington-based Levick Strategic Communications. “When he emerges, he should announce that he has changed his life and has learned new and healthier habits and that he is ready to contribute to his field and to society again. He then must demonstrate that he is serious about his new direction by contributing a sum of money or his time to a worthy project connected to the fashion industry or to helping a cause connected with Jewish interests. He behaved himself into his situation and now he must behave himself out of it.”

Grabowski cautioned, however, that the process could take a year or two “for the new reputation to build and for memories of the old behavior to fade.”

Robbie Vorhaus, founder of Vorhaus & Co., based in New York and Paris, rattled off a long list of famous people who came back from the brink: Robert Downey Jr., Eminem, Mickey Rourke, Britney Spears, Winona Ryder and Hugh Grant.

Yet he said their transgressions only seem passé and irrelevant now because they went back to work and demonstrated their talent, diverting public attention away from their bad behavior.

“Redemption and resurrection is a powerful story, and if Galliano can show that he retains his talent, instincts, skill set — and that he is sorry for his actions — he can, over time, return to a leadership role. However, it can’t be an act,” Vorhaus said. “If John Galliano is, in fact, in his heart racist or anti-Semitic, or is not willing or able to remain with his addiction recovery program, or he falls back into socially unacceptable behavior, he will have lost significant momentum for a long time to come.”

“I think he’s finished for a good while,” warned Glenn Selig, founder of Florida-based The Publicity Agency. “While he may be well known in fashion, to the vast majority of people this is their introduction to him. Because the public really doesn’t know him as a person, there’s no real reason for the public to open their hearts to him.”

Lingering anger toward Galliano surfaced last week when an onlooker called the disgraced couturier a racist as he whisked through the Los Angeles Airport and ignored questions lobbed at him.

Caught on camera, the video went viral — just like the one a month ago that depicted Galliano saying in a slurred voice, “I love Hitler,” and cost him his job.

Yet addiction experts agree rehabilitation is possible for the 50-year-old iconoclast.

“It may take more than one attempt but it is always possible,” said Lou Lebentz, an addiction therapist at The Priory Hospital in Roehampton, London.

Asked whether a return to the fashion industry could be a hindrance or a help to Galliano’s recovery, Lebentz replied: “[One has to ask] how important your work identity is to you. Do you need it in terms of boundaries and purpose or to take your mind off yourself?” she said, highlighting that the purpose and routine a patient may find in work could have a positive influence on their recovery. “Recovery is an inward journey, about shutting off the external world…you will not find the answers outside yourself.”

Deirdre Boyd, ceo of the U.K. charity Addiction Recovery Foundation, said that a lot of male addicts in recovery tend to go back to work. “Often they do very well because they are grateful to their employers, they may feel they owe their lives to their employers,” she said. As for Galliano, she said: “Maybe he will look more objectively on his life and reevaluate his priorities, and maybe the fashion industry is not the right place for him to go back to.” She added that the greatest predictor of successful recovery is support from family and then support from your place of work.

For the moment, Galliano has no job to which to return.

It is understood the in-house design team at Galliano, which shares members with Dior’s, will be charged with continuing to produce collections at a label prized for bias-cut dresses, newspaper prints and retro-tinged tailoring.

The Galliano business is based mainly on licensing. Key partners include Gibò Co. SpA for the signature men’s and women’s collections; Ittierre SpA for the second line Galliano: Perfume Holding for fragrances; Diesel for children’s wear; Marcolin SpA for eyewear; Albisetti for swimwear, and Morellato for watches.

Although sources deem an eventual sale of the company a foregone conclusion, as Dior seeks to put more distance between itself and the disgraced designer, Dior may first seek to further disentangle itself from the designer, who holds a minority stake in John Galliano SA.

It is understood there are other legal tussles ongoing related to Dior’s dismissal of Galliano, though nothing that would prevent it from naming a new couturier (see related story, page 5).

Revenues in 2009 at John Galliano SA, mostly from royalties, totaled 14.2 million euros, or $20.9 million, while losses tallied 5.3 million euros, or $7.8 million, according to legal information filed with the commercial court in Paris. Dollar figures are converted from average exchange rates for the period. According to Dior’s 2010 annual report, Christian Dior acquired John Galliano SA in 2008 for 17 million euros, or $23.8 million at average exchange rates for that year.

In an indication that it won’t be easy for the designer to return to fashion, retailers are already shunning Galliano products.

One American retailer, speaking on condition of anonymity, warned that the Galliano name now has toxic connotations. “I think his label will continue to create controversy for some time,” the executive said.

A spokeswoman for Selfridges, which has featured the Galliano second line in its men’s department, said the London retailer no longer carries the brand, but she declined to comment further. However, an industry source said the decision had to do with customer reaction to the Galliano drama.

Corso Como’s Sozzani said she has dresses from Galliano’s spring-summer designer collection hanging in her shop, but she did not place an order for fall, partly because of Galliano’s absence. “I’m waiting to see what happens,” she said, citing a policy that prohibits designer brands created by another person, if the founder is still alive.

According to market sources, retailers in America and the U.K. reacted immediately and sharply to the scandal and often pulled products off shelves, while the business in other regions, including Asia, Europe and the Middle East, remains largely unaffected.

“We hope Galliano will continue to perform. Despite what happened, we are happy with the license,” said Enrico Ceccato, president and ceo of Perfume Holding, the brand’s fragrance licensee. However, he denied interest in acquiring the Galliano business, insisting the company is dedicated to fragrances only.

According to Ceccato, the rollout of Galliano’s new Galliano women’s fragrance, Parlez-Moi d’Amour, is happening at almost the same pace as originally scheduled. The scent is set to launch in Asia and South America after hitting Europe and the Middle East at the end of last year. “The only question mark is how and when to launch in the U.S.,” said Ceccato referring to Perfume Holding’s initial plans to launch the scent there in early spring.

Antonio Bianchi, owner of Albisetti, which now controls Ittierre, acknowledged interest in the Galliano business, saying he is discussing ways to generate new and more extensive agreements “given the optimal relationship” it already has.

Whatever Galliano’s fate, his downfall highlighted the risk companies can face if their brand is too closely tied to the specific image or talent of one individual, who could leave the company, die or fall from grace, according to the legal adviser Pearce.

No matter how many people may be involved in bringing fashions to market, “we want rock stars: We want individuals that stand out,” she said.

A boilerplate statement in Dior’s annual report notes: “Inadequate products or communication policies with the brand image, inappropriate behavior of persons who represent the brands, along with circulation of prejudicial information to the media, could affect brand image and lead to an adverse effect on sales.”

Lucian James, creative director and founder of Paris-based strategic consultancy Agenda Inc., highlighted the irony that luxury brands, until recently nervous of social media, were seduced by the exposure opportunities the digital world afforded. “So it’s genuinely unfortunate that it is the John Galliano video outside La Perle which has become the most viral in fashion history,” he said.

Moreover, the Galliano incident highlights important changes that will affect the broader luxury industry. According to James, “We are witnessing the beginning of an important debate about the relationship between creativity and business imperatives.”

For one, “the acceleration of fashion has created more of a ‘hit-factory’ approach to creativity, which can squeeze and frustrate designers, and also put pressure on the overall business.

“It’s no surprise that the movie ‘Black Swan’ was so successful in this cultural mood because it exposes the ferocity and destructive power of creative talent. And more specifically it’s no surprise that the movie was such a personal favorite of so many people who work in the fashion world, and could identify so closely with its theme,” he continued.

James also predicted luxury brands will emphasize their original designers and “spiritual leadership so that issues like this are less damaging.”

For example, he said it would be a “powerful ritual symbol to concretely restore the image of Monsieur Dior at this point, via, for example, an empty chair at each runway show.”

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