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Still, the couture image of Dior, masterminded by Galliano, is crucial across the company, including the powerhouse Dior Parfums, part of LVMH.
Galliano’s famous inspiration trips to India, China, Japan, Turkey, Egypt, Middle Europe and within France brought rich rewards to his audience — and created some of the most arresting fashion show imagery the industry has ever seen. The designer’s immersion into the story lines behind his collections — be it the hidden life of Wonder Woman, the soirees of the Marchesa Casati or the paintings of Clovis Trouille — was absolute, which is what made his shows unmissable and memorable.
Galliano’s ouster, which comes about a year after the suicide of Lee Alexander McQueen, could usher in an era of toned-down fashion shows, as designers came under pressure during the economic downturn to trim budgets.
Dior has been taking a minute-by-minute approach to the fast-evolving crisis to protect its $1.1 billion fashion franchise, and safeguard Arnault’s most treasured fashion property.
Shares in Christian Dior SA, the publicly traded holding company for the Dior fashion house and luxury conglomerate LVMH Moët Hennessy Louis Vuitton, ended up 0.2 percent in trading Tuesday on the Paris Bourse to close at 104.65 euros, or $144.25, while shares in LVMH rose 0.9 percent to 115.30 euros, or $158.93.
“As far as Dior is concerned, I wouldn’t worry too much. It won’t be difficult for them to find new talent — it’s every designer’s dream to create for Dior,” said Luca Solca, a senior analyst with Bernstein Research in Zurich. “And I don’t think Galliano’s comments will damage the brand. It is important for Dior to choose the right creative director — and it will definitely be a breath of fresh air. This has also been free advertising for the brand.”
Widely touted contenders for the Dior couture mantle include Hedi Slimane, who walked away from Dior Homme in 2007; Givenchy’s star couturier, Riccardo Tisci, or red-hot Haider Ackermann.
Toledano has been leading an upscaling drive at Dior in recent years, in its products, stores and marketing. The strategy has been gaining traction. Revenues grew 15 percent in 2010 to 826 million euros, or $1.1 billion, while profits vaulted 169.2 percent to 35 million euros, or $46.5 million, as reported.
Branding and other experts said Dior is likely to rebound from the crisis, especially at a time when large luxury players have put their brands ahead of their star designers.
Sara Rotman, creative director and owner of MODCo Creative, likened Dior without Galliano to Gucci without Tom Ford. She said at first, “I think we all held our breath and thought, Oh my God, how is that going to work? And there was a season when it was a little bit tentative, and I think that they’ve come back strong.”
She characterized Galliano as “one of the few geniuses really left in our field.…But I think that the houses are getting really smart about it and soldiering on. I mean, when we lost McQueen, I thought the same thing — My God how are they going to make it? — but the first collection without him is actually quite strong. So I think the houses have a pretty good sense of who they are, and I think it took an enormous amount of strength of character for [Dior] to ask [John Galliano] to step down.”
“As we witnessed with Kate Moss’ past transgressions, brands must quickly remove themselves from the negative publicity,” said Meg Asaro, cultural curator at brand image developer Toniq. “Dior is a strong brand with a long-standing lineage. Therefore, it will easily rise above this speed bump in its path. Look at Martha Stewart, a brand whose identity is that much closer [to the founder] than that of John Galliano and Dior. Martha Stewart bounced back, and so will Dior — but much quicker.”
The John Galliano business, based on a licensing model, has also been on a growth track, but it is more intricately linked to the madcap designer, and is majority controlled by Dior.
Immediate fallout included the scuttling of a Galliano fragrance launch event scheduled for Germany next week, according to sources.
Public relations experts were divided on whether Galliano could emerge from the crisis to resume what had been a stellar fashion career.
“I think Galliano needs to justify what he’s done,” said Max Clifford, a London-based p.r. and damage-control expert. “He needs two or three Jewish friends to come forward and tell the public that he is not remotely anti-Semitic in all the years they have known him. Or he has to say it was meant to be a funny rant, or that he was just trying to annoy to the people sitting next to him.”
Asked if a public apology would help, Clifford said not necessarily: “In a perfect p.r. world it would, but then look at Mel Gibson. He apologized and it did not enhance his career; nor did it destroy it.”
Moira Benigson, managing partner at the London-based executive search firm The MBS Group, said an apology should have come sooner. “Had he done so, his experience would have been a walk in the park compared to Tiger Woods, for instance.” As for Galliano’s future, she said: “I don’t know what state of mind he’s in right now, but I am sure that someone will snap him up. This will definitely not cause long-lasting damage. Galliano is so important to the industry, and he has so many friends and supporters who will stand by him.”
Ilaria Alber-Glanstaetten, ceo of the London branding consultancy Provenance, said the designer “needs to be extremely repentant, check himself into rehab for addiction and anger management, and lay low for a long time. It’s true that a lot of people do come back from scandals, but there have not been mistakes of this kind before. Honestly, I don’t know if people can stand by those who make statements of the kind that Galliano made.”
Karen Harvey, ceo of Karen Harvey Consulting Group, said Galliano “would need to make major changes on a personal level if he wanted to have a future in the business. I don’t think these things are ever truly forgotten — especially this case.”