MILAN — There’s a lot behind a dress or a piece of furniture.
Italians know it well, as the national fashion and design sectors generated total revenues of 95.5 billion euros and 27.6 billion euros, respectively, in 2019 and the benefits of those revenues rippled through a variety of industries.
Events like Milan Fashion Week and the Salone del Mobile furniture and design trade show represent the cusp of fashion and design companies’ visibility but also set in motion and engage the entire city, offering those operating in other fields an opportunity to shine — and to bill.
Marco Barbieri, general secretary of Confcommercio Milano, Lodi and Monza and Brianza, the association that groups the companies operating in the Lombardy region, underscored that the city’s range of events usually helps boost the gross domestic product of Milan and its outskirts. “The events can easily intertwine with the economic structure of the city and its liveliness, which in the end have to do with the number of operating shops, restaurants and hotels,” he said, adding that events contribute to the “prosperity” of Milan, which in 2019 attracted 11 million more visitors than in the previous year.
In particular, in 2019 Salone del Mobile drew some 430,000 visitors to the city and the number of satellite events helped generate sales of 350 million euros during Design Week alone, or 19 billion euros considering the entire year. Similarly, the June 2019 edition of Milan Men’s Fashion Week alone attracted 30,000 or so buyers, vendors and journalists.
But the coronavirus outbreak that has had the country officially under lockdown since March 9 has shaped a completely new scenario for the season, as the former event was canceled and the latter postponed to Sept. 22 to 28, concurrently with the women’s shows. Beside design and fashion companies, firms operating in satellite industries linked to these events are also assessing the impacts on their businesses.
“There’s a whole behind-the-scenes world that has stopped,” said Gabriella Mazzei, chief executive officer of Italian production company Without Production. The firm she founded with Andrea Leonardi in 1999 is behind the flamboyant sets of Gucci — one of its longtime clients — and works with a range of fashion labels including Prada, Miu Miu, Marni, Giambattista Valli, GCDS and Benetton, as well as producing prime Condé Nast events.
“The fact that shows in June are canceled is obviously a loss for us. In average, we have five to six clients during Milan Men’s Fashion Week, considering that in recent seasons this event was even shortened,” said Mazzei, underscoring that during women’s shows the number of projects spikes. “We were also working on cruise shows for this spring and couture shows in Paris for July, but now these are other gaps that we will have to deal with.”
Mazzei explained that depending on the client, its budget and if it already has a location, the company starts to work on production from 30 days to four months ahead of the event. Beside fashion, which is the core of its business, Without Production works with Salone del Mobile’s organizers. “Since many years we produce the fair’s gala dinner and award ceremony, but we have also worked on other smaller events during that week,” said Mazzei of the fair, which was originally slated for this month. As a result, the executive forecasts a drop of 40 percent to 50 percent in her company’s revenues this year.
“Along with fashion, Salone del Mobile represents for us the most intense period of work, as we started scouting locations back in December,” echoed Katia Scala, cofounder of the Milan-based Studiokhom production agency, which in the past arranged presentations for Canali, Louis Vuitton and Acqua di Parma, among others.
“We will restart in September but the truth is that we don’t know how we will arrange events, considering we will still avoid big gatherings… Plus all fashion events will be concentrated in the same week, so we will have to deal with many projects using the same workforce, eventually risking making some choices in order to follow everything. But the biggest fear is that we won’t be able to restart even in September,” said Scala, adding that she expects revenues to drop 70 percent this year.
To face the emergency, the company is rethinking its business, looking to a smaller, secondary interior design-oriented division it has to help private customers and firms with the restyling of their showrooms and stores. “If the event business won’t gain back traction soon, we will try to focus our energies on this division and make it grow,” said Scala, who is particularly worried that in the event arena the situation might escalate in “a ruthless war among agencies to win clients, maybe offering discounts and cheaper fees,” with the additional implementation of digital tools taking the competition to a new level.
What Scala considers a menace, Mazzei sees as an opportunity. “We’re starting to think outside the box. We are partners of the 4FriendsFilm agency and we’re working with them remotely to develop new, digital formats to present to our clients, using AR and VR, maybe trying to do something in studio and re-elaborate it in post-production. But not only in terms of shows, also with simpler alternatives as clients will need to present their collections also to buyers, showrooms and their staff. So we’re also thinking of simpler, and cheaper, solutions to help them,” said Mazzei.
The executive stressed this is a first venture for the company, but its expertise in video and projections encouraged the team to think of other usage of these tools. Yet she believes this would help clients only temporarily, as physical fashion shows won’t be undermined by digital formats.
“A fashion show is a surplus value, the emotion it conveys can’t be substituted by something you experience on a screen. I think it will remain a key moment for a brand, not to present its clothes but its world. Of course, in the long-term shows will be revisited but they will maintain their appeal and impact,” said Mazzei.
“A lot of agencies are experimenting with online events, but I do believe that the relational aspect that is so much rooted in our industry will not wane down,” echoed Paolo Mazzoni, chief executive officer of the Milan-based M&M Events location provider and production agency operating events both during fashion and design weeks.
The company — which owns exclusive rights for 19th-century building Palazzina Appiani and the Hub 42 rooftop, among other locations — generates 60 percent of its turnover from location rental, which Mazzoni said is “more remunerative.”
“I believe that bigger locations with outdoor spaces will be privileged, maybe drawing smaller audiences,” Mazzoni noted, adding that he doesn’t think the upcoming fashion week in September, with almost double the number of events, will mitigate the cancellation of the shows in June. “Companies will probably scale back their budgets this year and also as a sector we might not have enough venues for everyone, so it’s going to be far from an optimum scenario,” he said, adding foreign clients, representing 10 percent of the agency’s business, might skip the season altogether.
Mazzei agreed that international attendance affected by travel limitations and brands’ spending capacity are unavoidable variables impacting the September shows, but not the only ones. “Having men’s and women’s shows together won’t make any difference for us, we are used to dealing with coed formats and ready to work on many fronts. But I don’t think it will be a ‘glorious’ fashion week, because I don’t honestly know when the fashion houses will be able to really resume their productions and work on the collections. Everything is still unclear,” she said, noting that brands would need to reprise activities no later than July to meet the fall deadline. If eventually they will be ready, Mazzei predicts that productions will be significantly downsized in terms of formats, locations and number of guests.
Eléna Olavarria Dallo, cofounder of boutique location agency Anticàmera, believes that sanitary measures could also “push companies to develop different formats and to choose smaller locations rather than big venues.” This might play in her company’s favor as it’s specialized in smaller and private venues intended for presentations, press days and dinners, and usually hosts 20 different projects per fashion season.
“I expect an increased number of requests and also more flexibility from our clients when it comes to preferred neighborhoods … I believe the combination of the two fashion weeks will trigger creative solutions including a willingness to adopt outdoor spaces,” she said about September. While expecting digital initiatives to assume a greater importance, the other cofounder Rossana Passalacqua believes “there will be companies which will still want to make a difference and deliver their messages outside the digital realm, especially after months of confinement.”
But with the lockdown still on and with 70 percent of its revenues coming from fashion clients and the rest from the design, music, TV and publicity industries, Anticàmera is currently experiencing a drop in the number of requests for shooting and advertising campaigns.
“We optimistically like to think that the cancellation of some events could even play in our favor as companies will try to compensate their absence producing catalogues or press material able to have more impact in terms of communication compared to other channels,” said Christian Brambilla, commercial director for Italy at the Nava Press company. The firm manufactures invitations, seat cards, gadgets and press materials for labels including Bottega Veneta, Giorgio Armani, Ermenegildo Zegna, Fendi, Gucci, Prada and Versace, as well as Chanel and Dior. It additionally works with prominent jewelry houses and watch-makers on events including Baselworld, which was also canceled this year.
Brambilla is confident a current loss in sales will be made up in the second half of the year “as the shows in June will be postponed to September, so we hope it will be only a matter of a delay, which will lead us to concentrate more efforts on projects that were usually distributed over a longer arch of time.”
Ivana Tubaro, partner at the Yvat & Klerb calligraphy studio, said that given the combination of men’s and women’s shows, “the number of invites for each event will increase and, despite possible budget cuts, I think overall there’s a great wish to resume the organization of gatherings.”
The calligraphy studio she founded with Claire Billiotte and Claudia Tavella is a go-to partner for brands such as Jil Sander, Etro, Moncler, Tod’s, Valentino and Brunello Cucinelli and key p.r. agencies. Services range from handwriting invites to shows and events to menus and seat markers for dinner parties, which during the fashion season represent a total of about 40 projects.
“To slow down the routine work and have some spare time doesn’t necessarily mean losing resources, it can be an opportunity to develop new initiatives and relaunch the activity on other fronts,” said Tubaro of the temporary stop of activities. “We would like to widen our offer with new services targeted to clients more inclined to digital, so with seriality features making them less expensive,” she revealed, also mentioning digital calligraphy classes to compensate for the drop in the work load, which was additionally impacted by the halt of weddings.
“Losing all these months in spring is a huge damage for us, because these are the ones providing economic stability to our business,” said Giulia Scialanga, one of the three partners of the Altatto catering company, which not only works with fashion and design companies but has the bulk of its business in private events. The firm, which counts Emilio Pucci, Sergio Rossi and Furla among its clients, also opened a bistrot nine months ago, currently shut down. “If the world of events will be slow to restart, our plan B would be to transfer this secondary activity into our main one,” said cofounder Sara Nicolosi, who estimates a loss of 35 percent in turnover this year. The fall fashion week won’t make things easier for the company either, “considering we won’t be able to accept double of our usual collaborations,” concluded their partner Cinzia De Lauri, who worries about the counter-trend the restoration category — one of the fastest growing in Milan in the recent past — will experience in the post-COVID-19 era.
These concerns were shared by veteran Rita Bressani Doldi, owner of the Intermezzo food catering company, which is usually involved in 12 to 18 events per fashion week for brands such as Michael Kors, Bally and Jimmy Choo. “We are a solid company and we learned through the years that limiting operating costs will make the difference both short- and long-term,” said Bressani Doldi, revealing that revenues will decrease 70 percent, even if activities resume in the fall. “But a lot will depend on how government will handle the relaunch of work in our country,” she said, hinting that pivoting her business toward corporate catering for big companies might work as a solution to the static event activity.
At the helm of the Eventservices agency that specializes in offering hosting and security services at the shows, Fabio Covizzi is another entrepreneur concerned about the stop of fashion and design events. “We work on 20 to 25 projects per fashion week, and right now planning a diversification of our business is unlikely,” said Covizzi, who predicts the September fashion week “will be a disadvantage, as events will overlap and many brands will go coed.” He believes that after that test, the new course of this industry will be clearer and “we will be in a better condition to evaluate how to restructure our company.”
“Getting back to normality will take a long time, but I believe that in the aftermath the economy will spike, like after all crises,” said Andrea Daneri, co-owner of the Milan-based Numero 9 flower shop, which at the moment is banking on online and phone orders made by private customers.
In particular, Daneri hopes for a fast reopening of hotels, in addition to fashion companies. “We usually work on six set-up projects during the shows, mostly for showroom presentations for the likes of Aquazzura, Chanel and Tod’s. Plus we work with all the best hotels — such as the Bulgari Hotel, Mandarin Hotel and Excelsior Gallia — that in those days and during the design week request many flowers for their guests, in addition to the ones to adorn their common areas. This represents 60 percent of our revenues, so the temporary shutdown of hotels and events’ cancellations are significant losses for us,” he said.
Hospitality operators might be the hardest hit by the crisis. According to Barbieri, restaurants in Milan will see sales decrease by 1.8 billion euros in 2020, while Federalberghi Milano, Lodi and Monza and Brianza, which groups hotel operators, expects revenues down 160 million euros just this month, with year-end figures falling 37 percent compared to 2019.
Overall, the coronavirus outbreak might cause a drop of 5 billion euros in Milan’s internal expenditure, said Barbieri. He also expressed concerns that September might not prove a fruitful month although he hopes the country will be in phase two of lockdown by then and that the events animating the city will represent “a lever for Milan to relaunch … although they will for sure look dramatically different than they did only four months ago.” For instance, restaurants will be forced to reduce the number of seats and every gathering or event will be scaled back significantly.
With fewer international visitors, car traffic will be affected, too. According to a tally compiled by Confcommercio Milano, Lodi and Monza and Brianza, 181 car hire enterprises and 2,000 vehicles were operating during the city’s four fashion weeks in 2019, while 163 businesses were active during Milan Design Week last year.
Pietro Trapletti, president of the Balsamo Group car service, estimates a 10 to 15 percent loss in revenues in June just because of Milan Fashion Week’s postponement, and a total 40 percent drop counting the ones in London and Paris, too. “As of today, requests and sales have dropped and we’re not seeing signs of recovery, but we are adapting to the new scenario,” he said, predicting that yearly revenues will decline by 4 million euros. In due course, the company plans to bank on business trips for managers and executives that might not feel comfortable using public transportation.
Conversely, Sandro Preziosa, owner of the Autoservizi Preziosa car service, believes a lot of companies will entirely forgo physical meetings for the foreseeable future. The company is expecting a 30 to 50 percent drop in revenues, especially because of the postponement of Salone del Mobile, which “had become quite a sales driver, similarly to what women’s fashion weeks represent for us.”
While Preziosa believes the move of men’s fashion week to September might help mitigate the impact of cancellations, Trapletti doubted activities will be carried out the usual way because of budget cuts and travel limitations.
Meanwhile, Mazzei appealed to the whole fashion system to set its relaunch starting from local talents. “I think the fashion chamber should arrange a virtual table to set the relaunch by creating local synergies among each party. Milan, across any industry, has great professionals. There’s no need to fly a casting director from New York or a stylist from Paris; we should put together all our forces to be reborn stronger from this. Maybe this project is premature for September but we should do something important to enhance Italian fashion in 2021,” she concluded.