How “Old Money” Fashion Families Lose Their Empires
The year is 1993. We find ourselves within the majestic confines of Gucci’s historic headquarters.
Maurizio Gucci, the calculating successor of a splendid fashion legacy spanning over 60 years, stands at the precipice of a heart-rending decision.
He once tactfully manoeuvred through family intrigues and power plays, as if a lead actor in a Shakespearean tragedy’s tragic 3rd act.
Today, however, he faces a daunting task — relinquishing his perceived birthright.
In the austere boardroom, Maurizio, aged 46, is painstakingly conducting negotiations for the sale of the Gucci name to Investcorp, a globally recognized Bahrain-based management firm.
The resonant echoes of his flamboyant spending, impulsive life choices, and costly marriage fill the tense air, serving as harsh reminders of why he must surrender the Gucci legacy.
This poignant scene mirrors a common narrative for old money fashion dynasties.
Surprisingly, the designer label adorning your attire or luxury handbag is often no longer owned by the namesake family.
Today, on Old Money Luxury, we delve into the tragic sagas of why and:
How “Old Money” Fashion Families Lose Their Luxury Empires
1. Fashion’s Family Dynasties: A Brief History
Fashion’s family dynasties have a rich and storied history, with the concept of “old money” in the industry stretching back to the 19th and early 20th centuries.
These families built their fortunes in an era of rapid industrialization and societal transformation, leveraging their unique skills, creativity, and business acumen to establish what would become some of the world’s most renowned luxury fashion houses.
Prominent examples of old money fashion families include the Guccis, the Pradas, the Versaces, and the Fendis.
These dynasties have not just shaped fashion trends across generations, but they have also wielded significant influence on global culture, lifestyle, and luxury consumer behavior. Their impact extends beyond the catwalk; they’ve had an indelible effect on the art world, film industry, and high society circles.
When everything is going well, being a family-run business in fashion brings numerous advantages.
There’s often a deep-seated understanding and passion for the craft passed down through generations, fostering a sense of continuity and tradition that can strongly resonate with consumers.
Moreover, these businesses tend to have long-term visions, a factor that often translates into a more sustainable business approach.
Indeed, much like a dynasties of royal hereditary monarchs around the world, successful family transitions are integral to these old money fashion dynasties.
For instance, the Hermès family has managed to maintain control of their brand across five generations, with a clearly defined succession plan that has allowed them to retain their brand’s distinct identity.
Similarly, Chanel has kept the brand’s legacy alive despite the passing of its founder, thanks to the foresight and talent of the late Karl Lagerfeld.
However, maintaining a family-run fashion house isn’t without its challenges.
Family control often comes with its fair share of internal dynamics that can threaten the stability of the business.
Disputes over control, diverging visions for the brand, or even a lack of interest from younger family members in taking the reins can result in instability.
Let us now describe three key examples of just how these dynamics can savagely wrench an old money fashion family’s namesake from their duly deserved next generations.
2. The Louis Vuitton Downfall: A Tale of Luxury and Loss
In the movingly romantic streets of 1850’s Paris, Louis Vuitton, a visionary craftsman, transformed his passion for luggage-making into a thriving enterprise.
His obsession with exquisite craftsmanship quickly enamored the Parisian elite, and the humble shop’s reputation burgeoned into a symbol of opulence, setting the stage for a luxury travel revolution.
Under the astute guidance of Louis’s son, Georges Vuitton, the brand unfurled its wings globally.
A potent mix of innovation and tradition birthed masterpieces like the iconic Monogram Canvas, entrenching Louis Vuitton as an emblem of elegance and affluence.
However, as the decades ticked into the 1970s and 1980s, the gilded brand began to tarnish. The market swelled with counterfeit Vuitton products, shadowing the brand’s exclusivity with a veil of reproducibility.
The ambitious venture into ready-to-wear collections, although initially a triumph, soon turned into a battleground against relentless competition and fickle fashion trends.
At the helm of the chaos was Henry Racamier, husband to Louis Vuitton’s great-granddaughter. He seized control in 1977, steering the brand towards growth.
Yet, the familial ties weaving the brand together began to unravel as Racamier’s vision clashed with the others.
Family disputes over the company’s trajectory, set against the backdrop of intensifying competition, birthed a maelstrom of internal turmoil and management missteps.
Confronted with this perfect storm, the Vuitton family made a heart-wrenching decision.
In 1987, they sold Louis Vuitton to the spirits conglomerate Moët Hennessy, birthing the powerhouse LVMH, thus leading to the rise of the world’s richest man, the almighty monarch of modern fashion — Bernard Arnault.
If you’re curious about the backstory of the Arnault Family dynasty and the current competition to helm that $500 billion luxury empire, click here to watch our recent deep dive into that intoxicating tale of fashion intrigue.
Of course, the Vuitton Family’s loss to the LVMH labyrinth was a bitter pill to swallow, with emotional ties and the family’s storied history with the brand adding a sting to the sale.
But the harsh reality of economic pressures and family dynamics left them no choice.
The Vuittons found themselves marooned post-acquisition, their once powerful influence dwindling to a whisper.
Lucky for them, however, the loss of their namesake would not (at least not yet) be the subject of a huge Hollywood blockbuster film, showcasing the tragic loss of the company AND death of one of the family’s key members.
That unfortunate reality would be the story of our next “old money” fashion family to lose their luxury empire.
3. The End of the Guccis: Death By Designer
The riveting narrative of the Gucci family is one of humble beginnings, ascension to dizzying heights, and an eventual, devastating collapse.
The prologue unfolds in 1921, with the industrious Italian artisan Guccio Gucci launching a modest leather goods shop in the heart of Florence.
Over decades, this unassuming endeavor metamorphosed into one of the most esteemed luxury fashion icons globally.
The golden age of Gucci emerged in the 1950s and 60s, buoyed by celebrity endorsements and high-profile patronage. A pivotal chapter was inscribed in 1953 when Jackie Kennedy, the era’s unparalleled fashion muse, was photographed clutching a Gucci bag during her husband’s presidential inauguration.
This defining moment not only cemented Gucci’s foothold in America but also projected the brand onto the global stage. In tribute, the bag was fittingly renamed “The Jackie”.
However, the glittering sheen of success began to tarnish as time marched into subsequent decades. Family discord, managerial missteps, and ill-judged business choices corroded the brand’s image and profitability.
The Gucci family’s stronghold on their empire began to crumble in the 1980s when the Gucci siblings found themselves ensnared in a bitter power struggle, their personal battles spilling over into lawsuits that further dented the brand.
Amidst this tumultuous storm, the family could do little to stem the ebbing profits and surging debts. By the late 1980s, the brutal reality had set in — they needed to sell Gucci to Investcorp, a Bahrain-based investment firm.
The aftermath was a total loss of the brand for the Gucci family. Maurizio Gucci, the final family member at the helm, was compelled to offload his remaining shares in 1993, marking the definitive end of the Gucci family’s reign.
The tragedy was amplified with Maurizio’s sudden death in 1995 and his ex-wife’s subsequent conviction for orchestrating his murder, a macabre epilogue to a tale of luxury and loss.
Of course, at this point it should go without saying that if you are interested in this topic — both the Guccis and other fashion empires — you must, must watch the incredibly riveting film House of Gucci which features Oscar-worthy dramatizations of this tale. Anything with Lady Gaga and/OR Adam Driver in it is worth seeing, regardless of the topic.
Now, the Gucci saga epitomizes the dangerous cocktail of internal family feuds, ineffective management, and lack of succession planning that can precipitate the downfall of even an internationally acclaimed family business like Gucci.
However, interestingly, Gucci itself (as a brand, not by the Gucci family) would purchase the next family name we will discuss, swallowing up the last pieces of a brilliant brand that to this day is marked by cutting-edge influence and fashion prowess.
4. The Unraveling of Saint Laurent: A Tale of Style and Sacrifice
The captivating tale of the Saint Laurent family unfurls with the birth of Yves Saint Laurent, a prodigiously talented young man who, at the tender age of 21, would take the reins of the esteemed House of Dior following Christian Dior’s sudden death in 1957.
In the turbulent 1960s, Saint Laurent decided to part ways with Dior to establish his own fashion house.
Backed by his partner, Pierre Berge, Yves Saint Laurent quickly gained a reputation for his groundbreaking designs, from Le Smoking suit to the sheer blouse, challenging societal norms and transforming the landscape of women’s fashion.
Saint Laurent’s meteoric ascent was not without its tribulations, however. Struggles with addiction and the pressures of his high-profile position began to take a toll on his physical and mental health. Yet, the Saint Laurent brand persisted, its star rising ever higher in the firmament of global fashion.
However, the lustrous veneer began to show cracks as the decades advanced. Financial difficulties, partly due to a tumultuous market and the increasing costs of maintaining an haute couture line, began to erode the empire’s foundations.
In the late 1990s, in a plot twist that even Ridley Scott’s direction couldn’t find time to find into a film, the decision was made to sell the brand to none other than the so-called Gucci Group, now a part of Kering conglomerate.
With the sale, Yves Saint Laurent and Pierre Berge lost direct control over the fashion house they’d built, although they remained involved in the haute couture line until Yves’s retirement in 2002.
After Saint Laurent’s death in 2008, Berge became the custodian of his legacy, overseeing the preservation and exhibition of Yves’s designs in their jointly established foundation.
Yet, the brand itself moved forward under new stewardship, shepherded by successive creative directors such as Tom Ford, Stefano Pilati and Hedi Slimane, who continued to reinterpret Yves’s iconic designs for a new generation.
